On July 17th, the California Office of Administrative Law (“OAL”) approved an emergency regulation (effective until January 14, 2021) from the California Department of Managed Health Care (“DMHC”) that specifies COVID-19 diagnostic testing coverage requirements for California health care service plans. Medi-Cal managed care plans, Medicare Advantage plans, and specialized health plans are not subject to the regulation. The DMHC provided additional context to the emergency regulation in an all plan letter issued on July 23rd.
The regulation deems COVID-19 testing to be an urgent health care service during the California state of emergency. It also states that COVID-19 diagnostic testing is a medically necessary basic health care service for enrollees who are essential workers, regardless of whether the enrollee has symptoms of COVID-19 or a known or suspected exposure to a person with COVID-19. Essential workers are defined in the regulation to include a broad range of individuals working in the health care, emergency services, public transportation, congregate care, correctional, food service, and education sectors. Additionally, they include individuals who work in retail, manufacturing, agriculture, and food manufacturing that either have frequent interactions with the public or cannot regularly maintain at least six feet of space from other workers.
Between the regulation, all plan letter, and other applicable federal law, California health plans will need to comply with the following requirements for enrollees seeking COVID-19 testing:
1. Enrollees With Symptoms of COVID-19 or Exposure to COVID-19:
- The plan cannot impose: (i) utilization management or prior authorization requirements, (ii) cost-sharing requirements, or (iii) limitations on the number or frequency of tests received.
- Enrollees can receive tests from either in-network or out-of-network providers.
2. Essential Worker Enrollees Without Symptoms of COVID-19 or Exposure to COVID-19:
- The plan cannot impose: (i) utilization management or prior authorization requirements or (ii) limitations on the number or frequency of tests received.
- The plan must offer appointments within 48 hours, at a location within 15 miles or 30 minutes of the enrollee’s residence or workplace. Otherwise, the enrollee can access the test from any available provider, including out-of-network providers (in which case in-network cost-sharing amounts apply).
- Ordinary cost-sharing requirements can be imposed.
3. Other Enrollees Without Symptoms of COVID-19 or Exposure to COVID-19:
- Plan can impose utilization management and prior authorization requirements, and testing is only required to be covered when determined to be medically necessary.
- Where medically necessary, the plan must offer appointments within 96 hours, at a location within 15 miles or 30 minutes of the enrollee’s residence or workplace. Otherwise, the enrollee can access the test from any available provider, including out-of-network providers (in which case in-network cost-sharing amounts apply).
- Ordinary cost-sharing requirements can be imposed.
If a health plan experiences difficulty in securing COVID-19 testing appointments for its enrollees due to regional or statewide shortages, it should contact its assigned reviewer at the DMHC.
For the diagnostic testing required under the regulation, health plans need to reimburse testing providers at contracted rates where available, the provider’s cash price (when required by federal law), or otherwise the reasonable and customary value of the services. Health plans also need to comply with Knox-Keene claim payment and submission timeframes and not delay or deny payment.
Any contractual change to delegate risk to a provider for COVID-19 diagnostic testing is considered a material change to the contract and needs to comply with the California provider bill of rights.