Get Ready, Get Set, to Cover COVID-19 Vaccines for Free

Last month, we reported that Moderna was seeking FDA authorization for its COVID-19 vaccine and reminded readers about the immunization coverage requirements in Section 3202 of the CARES Act in our SW Benefits Blog, “Free COVID-19 Vaccine and Testing Update.”  As of the date of this blog, the Moderna and Pfizer-BioNTech COVID-19 vaccines have been approved and group health plans must act quickly to meet the requirements of the CARES Act.

On October 28, 2020, HHS, DOL, and the Treasury issued interim final rules (the “new regulations”) about the COVID-19 immunization coverage requirements.  The new regulations generally took effect November 2, 2020 and are effective until the end of the COVID-19 public health emergency declared by HHS.  The new regulations clarify that non-grandfathered group health plans must cover COVID-19 immunizations without cost-sharing, even when delivered by an out-of-network provider, within 15 business days after an immunization has been:

  1. Recommended by the United States Preventive Services Task Force as an evidence-based item or service with an A or B rating; or
  1. Recommended by the Advisory Committee on Immunization Practices (the “ACIP”) of the Centers for Disease Control and Prevention (the “CDC”) and adopted by the CDC, regardless of whether the immunization appears on the CDC Immunization Schedules for routine use.

The ACIP issued an interim recommendation for the Pfizer-BioNTech COVID-19 vaccine on December 12, 2020, and for the Moderna COVID-19 vaccine on December 19, 2020.  This means group health plans must cover the Pfizer-BioNTech vaccine without cost-sharing within 15 business days after December 12, 2020, and the Moderna vaccine within 15 business days after December 19, 2020.  As new COVID-19 vaccines are approved, those too will have to be provided without cost-sharing within 15 business days.

Neither the CARES Act nor the new regulations define “business day,” but the DOL has defined “business day” for certain ERISA purposes as “any day other than a Saturday, Sunday or any day designated as a holiday by the Federal Government.”  Both December 25 and January 1 are designated federal holidays.  Following this definition of “business day,” group health plans must cover the Pfizer-BioNTech COVID-19 vaccine no later than January 5, 2021 and the Moderna COVID-19 vaccine no later than January 12, 2021.

Group health plans should consider covering recommended COVID-19 vaccines free of charge ahead of the 15-day deadline, in case employees or their dependents receive an early vaccine.  Although permitted by statute, it may be unwise to charge participants for vaccines received before the 15th business day.  Covering newly recommended vaccines on day one could simplify plan administration and ensure that participants will not receive any surprise vaccine bills.

Many employers are looking for ways to encourage employees and their family members to be vaccinated as soon as possible.  One of the best ways to encourage such behavior is to send a communication to participants telling them that all approved vaccines will be covered without cost-sharing (i.e., no deductible, copay or coinsurance) immediately following government approval.  However, before doing so, employers should check with their third party administrator or insurance company to confirm their plan can cover vaccines earlier than required by law.

For more information about the CARES Act requirements for health and welfare plans, see our April 1, 2020 SW Benefits Update, “The CARES Act – What Are the Health and Welfare Plan Issues to Consider?

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