Self-Funded Plans and the COVID-19 Vaccine

Self-Funded Plans and the COVID-19 Vaccine

Recently, pharmaceutical giants Pfizer and BioNTech, Moderna, and Eli Lilly and Company have each developed a promising vaccine candidate against COVID-19. Current research shows that these are at or more than 90% effective in preventing COVID-19 in participants. As the year ends and the pandemic continues to loom large in our lives, there is a lot of hope hinging on the quick and safe progress of these vaccines.

As these vaccines move through the FDA approval process, one question is at the forefront of employers’ minds:

“Who is responsible for funding the vaccine?”

Preventative Care and the CARES Act

The Federal Coronavirus Aid, Relief, and Economic Security Act (CARES Act) requires that non-grandfathered group health plans and health insurance issuers offer coverage (without cost-sharing) for any “qualifying coronavirus preventive service” with an evidence-based recommendation of “A” or “B” rating by the U.S. Preventive Services Task Force (USPSTF) or an immunization recommendation by the Centers for Disease Control and Prevention (CDC) Advisory Committee on Immunization Practices. A “qualifying coronavirus preventive service” means an item, service, or immunization that is intended to prevent or mitigate coronavirus disease 2019.

The CARES Act also requires that each health plan and insurance carrier provide the “service” within 15 business days of such a recommendation. This coverage requirement by self-funded group health plans includes minimum essential coverage plans.

“Who is responsible for funding the vaccine?”

The party ultimately responsible to pay for a COVID-19 vaccine to participants in a self-funded plan is not yet clear. For pharmaceutical companies participating in Operation Warp Speed, the understanding is that there is a negotiated term of $4 and $20 per dose. Knowing this, the federal government may choose to fund the program itself or require that employers or insurance carriers fund the vaccine, as was the case with the CARES Act regarding COVID-19 diagnostic testing.

As of now, employers and plan sponsors have no action required of them at this time. At Boon, we are diligently working with insurance carriers and self-funded group health plans to coordinate the implementation of any new preventative item or service that must be added to coverage.

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