Department of Managed Healthcare Issues an All Plan Letter Requiring Full-Service Health Plans to Cover COVID-19 Vaccines

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By Alex Ruf

On December 11, 2020, Sarah Ream, general counsel for the Department of Managed Health Care (DMHC), issued an All Plan Letter to all full-service health plans regarding health care coverage of the new COVID-19 vaccine. The Department directed health plans to cover COVID-19 vaccines with no cost-sharing to enrollees, even if the enrollee receives the vaccine from an out-of-network provider.

The first section of the letter outlines the requirements for “qualifying” vaccines. It specifies that the federal government will cover the cost of COVID-19 vaccines themselves, but that health plans must cover the cost to administer the qualifying vaccines to health plan enrollees. To “qualify” under the federal Coronavirus Aid, Relief, and Economic Security Act (CARES Act), a vaccine must either be: “evidence-based and has in effect a rating of ‘A’ or ‘B’ in the current recommendations of the United States Preventive Services Task Force;” or it must-have “in effect a recommendation from the Advisory Committee on Immunization Practices of the Centers for Disease Control and Prevention with respect to the individual involved.” The Department adds that health plans must begin to cover the administration of COVID-19 vaccines no later than 15 business days after a recommendation of the vaccine is made by the Advisory Committee on Immunization Practices, or the U.S. Preventive Services Task Force.

The December 11 All Plan Letter also details reimbursing providers at a “reasonable” rate for the cost of administering qualifying COVID-19 vaccines. The third section in the letter, “Frequently Asked Questions,” addresses potential scenarios that may arise as the vaccine becomes available, such as how plans should determine which enrollees receive the vaccine when demand for the vaccine is greater than the supply.

On December 11, 2020, the Department also issued a press release explaining its All Plan Letter. Alongside the press release, the Department posted a fact sheet informing enrollees that they have the right to a COVID-19 vaccine with no out-of-pocket cost. Both the press release and the fact sheet inform health plan enrollees of procedures to follow should they receive a bill related to the coverage or administration of a qualifying COVID-19 vaccine. The press release also links to guidelines from the California Department of Public Health that explain California’s vaccination plan and its planned phases of administering the vaccine.

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