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Free at-home COVID-19 tests are coming: How to get reimbursed by health insurance

Here is how many tests per month will be covered and whether you'll have to pay upfront.
/ Source: TODAY

It will soon cost nothing to take a rapid, at-home COVID-19 test available at pharmacies and stores.

The U.S. Department of Health & Human Services on Monday announced details of a plan for private health insurance to cover the over-the-counter tests, starting Jan. 15.

Expect possible "hiccups" in the early days, insurers cautioned, and be prepared to still pay upfront and save your receipt — at least at first.

The main problem now, of course, is the availability of the testing kits, which have been almost impossible to find as the highly contagious omicron variant spreads across the U.S.

At-home options

The U.S. Food and Drug Administration has authorized more than a dozen tests that are performed at home with a self-collected sample.

The kits include a swab for people to insert into their nose — but usually not as deeply as the traditional tests — and a test card or portable device where the sample is inserted and automatically analyzed. Results are often available in minutes.

The rapid test is an antigen test, which detects specific proteins from the virus and can offer faster results with less lab work.

It’s less sensitive than a molecular test, often referred to as a PCR test, which detects the genetic material of the virus. (Home collection kits for molecular tests still allow people to swab their own nose, but the sample must be mailed to and analyzed in a lab, which can take a few days.)

Questions about omicron sensitivity

Some rapid antigen tests may also be less sensitive at detecting the omicron variant in particular, the FDA said in late December without specifying the brands of tests, meaning it's possible they could miss an infection, known as a "false negative."

Still, people should continue to use them, the agency said, encouraging follow-up testing for anyone who tests negative with a rapid antigen test but is experiencing symptoms.

Some experts say throat swabs, in addition to nose swabs, can make the tests more sensitive for omicron.

'The tests should be free'

The plan to have health insurance companies cover the cost of rapid tests will help consumers, but “it is not a magic bullet by any stretch,” said Sabrina Corlette, co-director of the Center on Health Insurance Reforms at Georgetown University’s McCourt School of Public Policy in Washington.

“It's not removing the barriers that exist — it's maybe lowering them slightly for some people,” Corlette told TODAY.

"While this policy is filling a real need and will help a lot of families, it does not help the millions of people who are covered under Medicaid, Medicare or uninsured... we still don't have anything close to the national, coordinated and comprehensive testing policy that we need."

A pair of rapid tests can cost about $25. Whole families often have to get tested, so for a couple with three kids, the cost to pay upfront might be enough for some people to hesitate, Corlette noted. The tests should be free and far more available than they are now so anyone who has been exposed or has symptoms can get a test right away and not worry about the cost, she said.

As the details of the Biden administration’s plan were announced, health insurance providers were ready to "work as quickly as possible to implement this guidance in ways that limit consumer confusion and challenges," said Matt Eyles, president and CEO of America's Health Insurance Plans, an industry trade association, in a statement.

"While there will likely be some hiccups in early days, we will work with the Administration to swiftly address issues as they arise," he added.

Here is how the plan will work:

How many rapid tests will be covered?

Insurance companies are required to cover eight free over-the-counter at-home tests per person per month, so a family of four can get 32 tests per month for free.

Other countries have a different approach. In the United Kingdom, for example, a government website allows people to order a free pack containing seven rapid COVID-19 tests per day that is sent to their home.

The Biden administration says there will be a website where Americans can request at-home tests for home delivery for free, but details of this program haven't been announced yet.

Do I have to pay upfront?

It depends on where you get the test and whether your insurance company has set up a network of preferred providers.

The Biden administration is "strongly incentivizing" each insurer to create such a network, allowing members to pick up the test for free or order it online without any out-of-pocket expenses.

The incentive appears to be that insurers can cap the cost of the test at $12 if they use a preferred network, but they must pay 100% of whatever the testing company or retailer wants to charge if they don't set up a preferred network, Corlette said.

"As for how quickly all this can happen, that is a good question. While these may not be the most complicated contracts insurers ever undertake, negotiating and executing these with testing companies and retailers is not going to happen overnight," she noted.

If I have to pay upfront, what is the process to get reimbursed?

It will likely be similar to the process you go through with your health insurance company when you want to be reimbursed for an out-of-network visit or procedure. Save the receipt and then mail it to your insurance or upload it via an online portal.

“Right now, every insurance company does it a little differently and quite honestly… you have to jump through a number of hoops to get reimbursed,” Corlette said.

“So I would hope that the Biden administration would really emphasize and require insurers to provide a standard form and make it really simple and easy for consumers to go through this process.”

Is the coverage retroactive to tests bought before Jan. 15?

Insurers are not required by federal law to cover tests purchased before Jan. 15, but may do so, the government noted. It's best to contact your health plan to find out its specific policy.

Corlette recommended saving receipts from earlier purchases just in case and trying to submit them when the policy is in full effect.

What are the drawbacks of the plan?

Experts are concerned the cost of the rapid at-home COVID-19 tests will rise because manufacturers know the insurance companies will now have to pick up 100% of the cost of these kits and hike prices.

That, in turn, would impact people who don’t have health insurance, Corlette said.

What if I'm on Medicare or uninsured?

The government is buying 500 million at-home tests to be distributed for free to Americans who want them, starting in January. Details of this plan are still to come.

It's also providing up to 50 million free tests to community health centers and Medicare-certified health clinics.