INSIGHTi
COVID-19 and the Uninsured: Federal
Funding Options to Pay Providers for Testing
and Treatment
Updated November 3, 2020
Congress enacted provisions to increase access to Coronavirus Disease 2019 (COVID-19) testing and
treatment (including, for some programs, an eventual vaccine) under the Families First Coronavirus
Response Act (FFCRA; P.L. 116-127), as amended by the Coronavirus Aid, Relief, and Economic
Security Act (CARES Act; P.L. 116-136). Separately, Congress provided funding to support testing
infrastructure in the Paycheck Protection Program and Health Care Enhancement Act (PPPHCEA; P.L.
116-139). In addition, these laws appropriated funding to government agencies that provide health
services (e.g., the Department of Veterans Affairs) and for specific health providers (e.g., health centers).
These laws largely focus on COVID-related modifications for individuals who have public or private
health care coverage; however, this Insight discusses federal funding options under these laws that can be
used to pay providers for COVID-19-related testing and treatment for uninsured individuals through
funding distributed under an administrative construct referred to as the Uninsured Fund (UF) and a newly
created Medicaid option for testing.
Testing
Congress provided additional funding for health centers, which are obligated to provide care to al
individuals regardless of their ability to pay, to expand access to testing for uninsured individuals. It also
appropriated $1 bil ion in both FFCRA and PPHCEA to reimburse providers for diagnostic and antibody
testing and for associated costs (e.g., specimen collection), which is being administered as the UF. Under
the UF, providers must seek reimbursement for testing uninsured individuals, where uninsured is defined
in FFRCA as individuals who are not covered by a federal health program or are not enrolled in specified
types of private health insurance coverage. Except in a few instances (e.g., testing sites supported by the
Federal Emergency Management Agency) providers are not obligated to seek reimbursement from the
UF). However, those that do must comply with certain terms and conditions that include accepting the
fund’s reimbursement, at the Medicare rate, as full payment. These requirements may mean that some
providers wil instead choose to pursue payment from individuals, which may be higher than the
Medicare rate.
Congressional Research Service
https://crsreports.congress.gov
IN11526
CRS INSIGHT
Prepared for Members and
Committees of Congress
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Medicaid Option: Full Federal Provider Reimbursement for “COVID-19 Testing”
Enrollees
FFCRA, as amended by the CARES Act, provides states an option during the public health emergency
(PHE) period to use Medicaid to pay participating providers for COVID-19 testing administered without
cost sharing to uninsured individuals. Under the FFCRA Medicaid option, the definition of uninsured
individuals used elsewhere in the law is expanded to include additional groups (e.g., certain enrollees who
are entitled to limited Medicaid benefits). For the 18 states that have adopted the “COVID-19 testing”
eligibility group (as of September 2, 2020), Medicaid providers may seek 100% federal reimbursement
for COVID-19 testing, testing-related state plan services, visits, and administrative expenditures for
otherwise eligible uninsured individuals (e.g., those who meet federal and state requirements regarding
residency, immigration status, and documentation of U.S. citizenship) who are enrolled under this
pathway. Unlike most Medicaid eligibility pathways, there is no financial eligibility test associated with
the “COVID-19 testing” group, and states are encouraged to inform applicants that they may be eligible
for comprehensive coverage. Benefits under the “COVID-19 testing” group are limited and terminate
with the sunset of the declared emergency period (i.e., potential y before COVID-19 transmission ends).
Treatment
For outpatient treatment costs for uninsured individuals, Congress provided additional funding for health
centers, which are obligated to provide care to al individuals regardless of their ability to pay. No
additional funding was appropriated for inpatient COVID-19 treatment costs. However, under the CARES
Act, Congress established the Provider Relief Fund (PRF) to make payments to health care providers for
foregone revenue due to COVID-19. Subsequently, the Administration announced it would use an
unspecified amount of the funds appropriated to the PRF to reimburse providers for uninsured treatment.
A total of $175 bil ion was appropriated to the PRF; as of the date of this Insight’s publication, more than
$143 bil ion has been al ocated. Uninsured treatment via the PRF is administered through the UF
discussed above.
For as long as funding remains available, the UF may reimburse for COVID-19 treatment and eventual
vaccines provided to uninsured individuals. For treatment purposes, uninsured is defined as not having a
source of coverage at the time that services are rendered, which is less specific than the FFRCA uninsured
definition above. The UF also is to reimburse providers regardless of the citizenship status of the patient
treated. As with testing, providers are not required to seek reimbursement from the UF and may opt not to
seek reimbursement for the reasons noted above. Providers or patients also may not be aware of the fund.
The UF only reimburses for treatment when COVID-19 is the primary diagnosis (except for pregnant
women, where COVID-19 may be a secondary diagnosis). It reimburses for services that are otherwise
covered by Medicare, but it wil not reimburse for outpatient prescription drugs, even if such drugs are
used for treating COVID-19. These limitations may mean the fund wil not always pay for COVID-19-
related care—for example, in instances when a patient was not diagnosed because of testing shortages or
for long-term medical conditions caused by COVID-19. In these instances, providers may bil individuals
or provide services as charity care. It is also possible that individuals may forego care. As noted, amounts
available for treatment are subject to availability, and it is not yet known whether they wil be sufficient,
particularly for the costs associated with acquiring and administering a vaccine to uninsured populations
if and when one becomes available.
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Author Information
Evelyne P. Baumrucker
Elayne J. Heisler
Specialist in Health Care Financing
Specialist in Health Services
Disclaimer
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IN11526 · VERSION 3 · UPDATED