EDITORIAL: Narrowing coverage of Covid tests is wrong decision for health insurers

Aug. 26--The refusal by local health insurance providers to cover Covid-19 tests for the general public unless they are required for a specific medical diagnosis looks penny wise but pandemic foolish.

A story in The News this week detailed a policy change announced by Western New York's three primary health insurance carriers, Independent Health, Univera and HealthNow New York, the parent company of BlueCross BlueShield of Western New York. Federal legislation in March required the companies to cover Covid-19 tests in full, with no prior authorization or co-pay required. In late June, a memo from the Departments of Labor, Treasury and Health and Human Services narrowed the requirement, saying insurers could deny coverage for testing for workplace safety or public health surveillance. That means the companies don't need to pay for back-to-work or back-to-school testing, unless it is deemed medically necessary.

The insurance companies say that if employers start to require testing for everyone returning to work, their costs would soar. America's Health Insurance Plans, a trade group, estimates it could cost health plans $25 billion a year for Covid testing, another $19 billion for antibody testing.

At the same time, many health insurance companies have recorded large profits this year. Anthem and UnitedHealth, two of the largest health insurers, nearly doubled their profits during the second quarter. While the companies had to bear new costs associated with Covid-19 testing and care, the industry saved billions by not having to pay for expensive, elective surgeries. Also, visits to doctors' offices and emergency rooms were down, as people stayed away for fear of infection.

Those costs are starting to rise, as more individuals make use of routine medical care. Also, students are heading back to schools and colleges, which will sharply drive up the demand for testing.

The health insurance companies urge more people to make use of government-provided, free testing. Erie County received $160.3 million in March in the federal government's Coronavirus Relief Fund. As of Wednesday, the county had spent or committed $81.8 million of those funds, about 51%, according to the Health Department. Funds committed to school districts and outstanding county orders to purchase PPE are included. The county has to make efficient use of its funds, but testing is one of many items it must budget for. Not everyone needing a Covid-19 test will have the ability to get to a county facility. The health insurers have a major role to play.

Erie County Health Commissioner Dr. Gale Burstein called the insurers' change in policy "frustrating." Both County Executive Mark Poloncarz and Buffalo Mayor Byron W. Brown sent letters to the insurance companies, urging them to continue covering the tests as they have in the past.

The state has noted a recent uptick in Covid-19 infection rates in Western New York. Widespread testing, contract tracing and isolation of those exposed to the coronavirus are essential steps in stopping its spread.

Prevention is generally cheaper than providing urgent medical care. Each test costs about $100 or more. That's real money, but it does not take an economist to figure that for the cost of treating one Covid patient in a hospital's intensive care unit, one could purchase enough tests to administer to a small army.

A new breed of simpler, less expensive Covid tests with faster results is on the horizon. The Food and Drug Administration last week gave emergency authorization to SalivaDirect, a test protocol created by Yale researchers. Tests that use saliva and common enzymes, rather than specialized reagents, will make testing considerably cheaper -- perhaps $10 or $20 per test. The tests must be processed by a certified lab; it is not like a home pregnancy testing kit. There is debate over whether saliva tests are as accurate as the standard swab tests, but their ease of use and low cost will make them an attractive option for businesses, schools and anywhere else requiring large numbers of tests.

Scientific and technological innovation will eventually make testing much easier, just as they will solve many of the problems associated with coronavirus. Until then, individuals and organizations need to make smart choices. Putting a cost barrier in the way of Western New Yorkers having access to Covid tests is not smart.

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