NY AG: 300K people to see refunds, bills canceled after CityMD charged for COVID tests

More than 300,000 people will see bills for their COVID-19 tests wiped away or refunded, Attorney General Letitia James said Tuesday after accusing CityMD of improperly charging New Yorkers about $14 million.

James said her office opened an investigation more than two years ago after receiving complaints about the bills from CityMD, an urgent care provider with more than 140 locations in New York. The office found that patients were billed despite federal and state regulations that, at the time, barred providers from charging co-pays and deductibles for medically necessary COVID-19 tests — in some cases, issuing the bills as long as two years after services.

“CityMD’s actions added unnecessary stress and financial burdens to patients seeking essential COVID-19 testing at the height of the pandemic,” James said in a statement.

Federal regulations required health plans to cover the full cost of COVID tests during the federal public health emergency, which ended in May 2023. But health plans still rejected some charges associated with the tests, and some providers passed those charges on to patients. Health plans now have more discretion over COVID testing coverage.

According to James’ office, CityMD’s website and staff assured patients during the height of the pandemic that they wouldn’t face out-of-pocket costs for testing, and patients who tried to complain had difficulty getting in touch with the company. When the patients did reach CityMD, James’ office said, the company often refused to amend bills.

CityMD has sent all affected patients letters by mail and email letting them know about the refunds and bill cancellations, James’ office said. The company is expected to erase about $7 million in outstanding bills for more than 87,000 patients. James said CityMD will also refund another $7 million to more than 215,000 people who already paid. The company will pay an additional $95,000 in penalties to New York State.

CityMD said in a statement on Tuesday that it settled the matter with James' office to avoid the cost of prolonged litigation. The company said it didn't admit any liability or wrongdoing.

In 2023, CityMD told Gothamist it would waive balances and stop sending bills for COVID-19 tests issued at the height of the pandemic — some of which came late after the urgent care company tried to work with insurers for reimbursements.

This story has been updated to include a statement from CityMD.