DOL Says Insurers To Pay for COVID-19 OTC Testing

The U.S. Department of Labor (DOL) has resolved the question regarding “who pays” for COVID-19 testing costs and the answer will be a surprise, and relief to employers. In cases where employees have health insurance and use over the counter COVID-19 diagnostic tests (“OTC tests”), the DOL says insurers must cover the costs of the participant’s tests.

This clarification comes just in time, as those subject to the OSHA Emergency Temporary Standard on Vaccination and Testing (ETS) begin to implement testing requirements. The ETS created a grey area relating to testing costs. OSHA stated that the “ETS does not require employers to pay for any costs associated with testing.” However, OSHA also recognized that many state and local laws, and agreements, may require employers to cover testing costs for employees. Confusion particularly arose when there were exceptions in statutes for “required costs” or in those states that were silent on medical costs but required employers to cover other employment-related expenses.

These issues appear to have been resolved by the DOL for employers whose employees have health insurance and will be utilizing OTC tests. The Biden administration directed that beginning on January 15, 2022, health insurers must cover or reimburse costs for OTC tests for plan participants. The DOL provided FAQs clarifying that this OTC coverage would include at least 8 tests per 30 days without medical recommendation, more than enough to meet the ETS’s weekly testing requirement. The FAQs also state that a participant cannot be required to pay any out-of-pocket costs or must be reimbursed for the actual costs of OTC tests for in-network coverage or up to $12 per test for non-preferred retailers. Therefore, neither the employer nor the employee will be required to pay for the cost of OTC tests necessary to comply with the ETS, if the employee has applicable health insurance coverage.

It is important that employers who need to comply with the ETS remember that they will still need to observe, or have a third-party observe, the results of an employee self-administered OTC test. The ETS permits OTC tests but does not permit the test to be both self-administered and observed.

Employers who need assistance in updating ETS policies or other testing procedures to take advantage of these newly covered OTC tests, or who have other questions related to COVID-19 and the workplace, should contact Leah K. Sell.

Leah Sell is an Attorney with Leech Tishman in the Employment & Labor Practice Group. She is based in the Pittsburgh office and can be reached at 412.261.1600 or lsell@leechtishman.com.

Leech Tishman’s Facebook Page: https://www.facebook.com/leechtishman

Leech Tishman’s Twitter: https://twitter.com/LeechTishman

Leech Tishman’s Company Page on LinkedIn: https://www.linkedin.com/company/leech-tishman

Leech Tishman Fuscaldo & Lampl is a full-service law firm dedicated to assisting individuals, businesses, and institutions. Leech Tishman offers legal services in business restructuring & insolvency, corporate matters, employment & labor, estates & trusts, intellectual property, litigation & alternative dispute resolution, and real estate. In addition, the firm offers a wide range of legal services to clients in the aviation & aerospace, cannabis, construction, energy & natural resources, healthcare, and hospitality industries. Headquartered in Pittsburgh, PA, Leech Tishman also has offices in Chicago, Los Angeles, New York, Philadelphia, Sarasota, Washington, D.C. and Wilmington, DE.