5 Things You Should Know About ‘Free’ At-Home Covid Tests

Yves here. This post oddly misses a critical point about health insurer economics. They’ve done so well under Covid that they can hardly whinge about the cost of tests, particularly since a lot of Americans will get the 4 tests per household by mail first, since that is a very low work/risk transaction (order online and have it delivered). But of course anything other than a single person household that has members that go out and about in risky settings could burn through a lot of tests quickly.

But back to the “Oh so sad, insurers have to eat this cost.” They have been collecting the same premiums all through Covid when tons of insureds have put off elective surgeries (both due to MD/OR backups after lockdowns, as well as caution, of being willing to be treated only when case counts are not too high) and even regular visits like checkups. I doubt that the cost of these tests would take their profits down to pre-Covid levels.

However the article usefully points out the tricks and traps in this policy, such as the (low) reimbursement cap and the fact that the scheme bizarrely does not cover Medicare recipients.

And yours truly submits for medical reimbursements all the time, but for those not in the habit, that’s another point of failure.

By Damon Darlin. Originally published at Kaiser Health News

Americans keep hearing that it is important to test frequently for covid-19 at home. But just try to find an “at-home” rapid covid test in a store and at a price that makes frequent tests affordable.

Testing, as well as mask-wearing, is an important measure if the country ever hopes to beat covid, restore normal routines and get the economy running efficiently. To get Americans cheaper tests, the federal government now plans to have insurance companies pay for them.

The Biden administration announced Jan. 10 that every person with private insurance can get full coverage for eight rapid tests a month. You can either get one without any out-of-pocket expense from retail pharmacies that are part of an insurance company’s network or buy it at any store and get reimbursed by the insurer.

Congress said private insurers must cover all covid testing and any associated medical services when it passed the Families First Coronavirus Response Act and the Coronavirus Aid, Relief and Economic Security, or CARES, Act. The have-insurance-pay-for-it solution has been used frequently through the pandemic. Insurance companies have been told to pay for PCR tests, covid treatments and the administration of vaccines. (Taxpayers are paying for the cost of the vaccines themselves.) It appears to be an elegant solution for a politician because it looks free and isn’t using taxpayer money.

1. Are the tests really free?

Well, no. As many an economist will tell you, there ain’t no such thing as a free lunch. Someone has to pick up the tab. Initially, the insurance companies bear the cost. Cynthia Cox, a vice president at KFF who studies the Affordable Care Act and private insurers, said the total bill could amount to billions of dollars. Exactly how much depends on “how easy it is to get them, and how many will be reimbursed,” she said.

2. Will the insurance company just swallow those imposed costs?

If companies draw from the time-tested insurance giants’ playbook, they’ll pass along those costs to customers. “This will put upward pressure on premiums,” said Emily Gee, vice president and coordinator for health policy at the Center for American Progress.

Major insurance companies like Cigna, Anthem, UnitedHealthcare and Aetna did not respond to requests to discuss this issue.

3. If that’s the case, why haven’t I been hit with higher premiums already?

Insurance companies had the chance last year to raise premiums but, mostly, they did not.

Why? Perhaps because insurers have so far made so much money during the pandemic they didn’t need to. For example, the industry’s profits in 2020 increased 41% to $31 billion from $22 billion, according to the National Association of Insurance Commissioners. The NAIC said the industry has continued its “tremendous growth trend” that started before covid emerged. Companies will be reporting 2021 results soon.

The reason behind these profits is clear. You were paying premiums based on projections your insurance company made about how much health care consumers would use that year. Because people stayed home, had fewer accidents, postponed surgeries and, often, avoided going to visit the doctor or the hospital, insurers paid out less. They rebated some of their earnings back to customers, but they pocketed a lot more.

As the companies’ actuaries work on predicting 2023 expenditures, premiums could go up if they foresee more claims and expenses. Paying for millions of rapid tests is something they would include in their calculations.

4. Regardless of my premiums, will the tests cost me money directly?

It’s quite possible. If your insurance company doesn’t have an arrangement with a retailer where you can simply pick up your allotted tests, you’ll have to pay for them — at whatever price the store sets. If that’s the case, you’ll need to fill out a form to request a reimbursement from the insurance company. How many times have you lost receipts or just plain neglected to mail in for rebates on something you bought? A lot, right?

Here’s another thing: The reimbursement is set at $12 per test. If you pay $30 for a test — and that is not unheard of — your insurer is only on the hook for $12. You eat the $18.

And by the way, people on Medicare will have to pay for their tests themselves. People who get their health care covered by Medicaid can obtain free test kits at community centers.

A few free tests are supposed to arrive at every American home via the U.S. Postal Service. And the Biden administration has activated a website where Americans can order free tests from a cache of a billion the federal government ordered.

5. Will this help bring down the costs of at-home tests and make them easier to find?

The free covid tests are unlikely to have much immediate impact on general cost and availability. You will still need to search for them. The federal measures likely will stimulate the demand for tests, which in the short term may make them harder to find.

But the demand, and some government guarantees to manufacturers, may induce test makers to make more of them faster. The increased competition and supply theoretically could bring down the price. There is certainly room for prices to decline since the wholesale cost of the test is between $5 and $7, analysts estimate. “It’s a big step in the right direction,” Gee said.

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  1. Taurus

    But the most important thing to know about the tests is that they produce false negatives but very rarely false positives.

    1. Joe Well

      Are they false negatives or just that at the moment of taking the test your body was not producing much antigen?

      Zeyneo Tufekci is always claiming the tests are good at detecting infectiousness in the moment for this reason.

      1. Taurus

        Levels are not detectable. What I meant was that a negative test does not necessarily rule out infection. You might need to test consecutive days. That’s why 4 tests per family are laughably insufficient.

        1. Joe Wel

          Definitely insufficient even if they were PCR tests considering they are for a whole family.

          I laughed when they announced they would directly provide “one billion tests” like Doctor Evil. Do they not know there are 330 million people in this country?

        2. Amfortas the hippie

          i’d like a lot more clarity on the issue of tests and their accuracy.
          the other day, my pcr came back negative, 6 days after symptom onset, and after symptoms had abated, for the most part.
          same deal with mother in law, today…except they told her a test wasn’t necessary, because , essentially, she’s 5 days into symptoms.
          this is the second time i’ve been definitely exposed to wife and boys after they all tested positive(only wife had symptoms first time around, a year ago).
          yet i tested negative both times(no symptoms a year ago, definitely symptomatic this time).
          i joked with the nurse practitioner that maybe they need to send my blood up the chain….might be something useful, if the negative result is accurate(which i doubt, this time, due to the unusualness and severity of the symptoms(compared to usual january allergies/sinus infection))
          wife still has a junkie cough, and has lost her voice again.
          I’m on steroids and antibiotics…and the headache has abated, but i still get the fog.
          due to the weird(for me) symptoms…as well as the reality of my exposure(taking care of wife for 4+ days) i’m going forward assuming that i had it.
          won’t change day to day behaviour on my part(masking, etc)…but i’ll be on the lookout for any long covid things.*

          so…all that said…is there any actionable intel on accuracy, false pos, false negs, variability in efficacy due to time after symptom onset, etc?
          nurses around here believe the CDC(except for the school nurse, who rolled her eyes while lamenting false neg)
          and, since the local hive mind has been so thoroughly poisoned with maga itaintreal and utter distrust of the evil libs, i’m sure my questions, no matter how i couch them, get me relegated into that crowd.

          (* and re: long covid without a medical record that actually says “had covid”.
          been there done that, as far as lack of medical records…regarding my hip, and the rest of my joints. the disability bean counters just couldn’t believe that i hadn’t been running to the doctor all the time and documenting my every hurt…even though i never had insurance, and paid cash for doctor visits,and only when absolutely necessary, for more than 20 years.
          a lot of people are fixin to fall through the proverbial cracks like i did…and likely get radicalised, too.)

    2. ChiGal

      The most recent episode of TWiV (update episode) discussed a preprint that found much greater agreement between antigen and PCRs if the timing is right and cycles are limited to 30 on the PCR. Turns out, the PCR is oversensitive and remnants of virus from an infection over a month old can turn it positive.

      Probably the most informative episode yet and that’s saying a lot.

  2. Lee

    Took a look at the AARP page on the topic. One of the comments sums up well the deficiencies of both the government plan as regards tests for those on Medicare and AARP’s apparent lack of interest and advocacy on behalf of its constituency.

    As for the government decision, given the number of seniors and their high rate of voter turnout —they made up 11% of the total vote in 2020—I am once again, as is so often the case of late, forced to pose the question: WTF are they thinking?

    13 HRS AGO
    AARP knows that many seniors are on Medicare – and a large number of those are on regular medicare with supplemental coverage – often gotten through AARP – so why does this article not focus on how these seniors who need these at home tests the most can get these tests through Medicare – and if that is not possible WHY IS AARP NOT LOBBYING FOR THIS AND IMMEDIATELY! The free tests from the government are limited to FOUR – that is fine for my wife and I each for two tests – AND THEN WHAT? We exist in a limited income and it too often seems NO ONE stands up for US!

    1. jackiebass63

      My take on the AARP is it is more interested in selling things , and insurance is a big one, to it’s members. I joined when I became 55. It didn’t take me long to decide that I wasn’t going to renew my membership.

        1. Arizona Slim

          I’m with you on that one. I was warned about AARP when I was way younger than I am now. And that’s why I have never joined.

          Family blog ’em.

      1. Pat

        I am a member because I can get the cheapest supplemental policy at the level I want through them. The savings more than offsets my subscription. I would not be one otherwise.

        1. Stillfeelinthebern

          I thought the price of medicare supplemental policies was regulated. When you get a cheaper policy, you are getting lower coverage. Can someone comment on this?

          I also avoid AARP.

          1. Pat

            What is offered and covered is dictated, according to the health group which helped me, while there are small differences, insurance company 1’s b level supplement will cover the same things as company 2’s, same a to g. When I got my coverage last year, the aarp plan was 5 dollars a month cheaper than the next, looking at the summary page they now have my policy at $10 more, but I have not gotten a premium increase, so there may be some wiggle room for smoking and gender.

            Perhaps the policies at four hundred dollars more a month have some perk not associated to hospitalization, tests and doctor visits I don’t know about, but the basics as presented in their summaries did not justify the increased cost for me.

    2. Carla

      Yes, AARP is simply an insurance sales vehicle. Rip-off like every other damned thing in this spectacularly venal country.

    3. Oh

      AARP is an insurance company and uses the AARP label to lure people into providing them their address and other data. I don’t believe that they’ve ever lobbied in favor of M4A.

      1. jefemt

        AARP also is a powerful lobbying entity.

        When I look at the byzantine nature of Medicare / Medicaid systems, and Health Insurance, the amount of bureaucratic waste stuns. And don’t get me started on Executive pay.
        I have heard from Docs/ medical professionals in my friend/ family circles -universally –come up with a 35-40% added cost due to these “institutions”. That there is a lot of savings to be had on the CARE front.

        AARP, and lobbying for a specific demographic set— the retirees and elderly— gall me.

        Streamline it, cradle-to-grave it. All-in, no exemptions, one pool called USA.
        First members are Congresscritters, the Military, and Federal employees.

        If there ever were a time for a deep re-set, on every front, is it not 2022?

      2. Ergo Sum

        Why would AARP lobby for M4A? If M4A would become a reality in the US, a HUGE IF, their business model would crumple instantly…

  3. juneau

    Insurance premiums didn’t go up? Mine went up 30 percent this year as a sole proprietor buying a policy for myself only. I guess New York rates are higher because of pandemic costs (ICU etc…). Medicare patients are always cut out of private pharma based discounts as well, things like free copay cards and first month free medicine coupons. I am sure there is a profit motive behind this discrepancy but I don’t understand it.

    1. Leftcoastindie

      My premiums for my supplemental medicare insurance went up 10% last year. What are they talking about?

  4. DTK

    1-5 is the problem with listening to ‘most economists’. To pay for the tests, and in the interest of public welfare, Congress could appropriate the funds, and from the Treasury’s account at the Fed, the Fed could mark up whatever accounts needed to pay to deliver tests to everyone in the US. There’s no need to involve insurance companies.

  5. CuriosityConcern

    If testing prevents an individual from leaving their abode and infecting others, who may end up being hospitalized or given the monoclonal, would that not save the payor a boat load of bucks? 40-100$ vs 6k-1 mil+?

    1. t

      That’s the plan. But the rapid tests I’m aware of test for being infectious, not sick. So a negative test today is only good for today. With a positive test, you can just say well this sucks, I’ll probably be capable infecting others for X days. Guess I’ll try to be extra careful at work.

  6. Stillfeelinthebern

    From M. Mina, this figure from an article in the New England Journal of Medicine. A positive rapid antigen test shows when you are infectious. The objective is to know when you are infectious so you can isolate and avoid infecting others. That mean having a very quick, easily available test and to do this testing often.


    @Michaelmina_lab on Twitter is excellent on testing. He cites literature and lots of conversation about rapid tests with people doing them.
    This is the tweet with the paper reference. https://twitter.com/michaelmina_lab/status/1482962777346035715?t=FbFP2srDJdgdMMyw0Xk3eg&s=19

  7. Pat

    I thought it was interesting that right after a news report on this, the local news anchor asked the reporter a skeptical and not so approving question:

    “Isn’t that a lot of paperwork?”

    IOW, someone who would be using this got immediately that having to apply for reimbursement was going to be an unnecessary pain and, as NC points out often, a tax on their time.

  8. BondsOfSteel

    I wonder if future insurance premiums will be held in check because 800,000 of the sickest people died. There’s got to be a lot of future savings there.

    Economics… the dismal science.

  9. bluegrapes

    I can’t speak for other insurance companies but UnitedHealthcare specifies they pay $12 per test, not per package. They spell out that a 2 pack of tests would receive up to $24. Walmart sells a 2 pack for 19.99 in my area. Walgreens and CVS 24.99. I am sure it will take an eternity to get my reimbursement check but I filed a claim right away on the 15th when it became available online. Will report back progress.

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