Source: Modern Healthcare
Insurers and employers are considering the financial implications of covering — or not covering — vaccines as guidance from federal and state authorities shifts.
Health and Human Services Secretary Robert F. Kennedy Jr. has radically reshaped the country’s approach toward public health. His controversial actions have provoked uncertainty for providers, patients and health insurance companies. Support for shots among insurers appears to be resolute, however.
“We’re not hearing that [insurance companies] are going to make changes to vaccine coverage policy,” said Dr. Jennifer Lee, chief medical officer of the Alliance of Community Health Plans. The alliance represents insurers affiliated with nonprofit health systems such as Oakland, California-based Kaiser Permanente and Danville, Pennsylvania-based Geisinger.
Kennedy has been under fire from Democrats and a handful of Republicans on Capitol Hill as well as medical and public health organizations and leaders over his stance toward vaccines, which he has long proclaimed to be dangerous despite overwhelming contradictory evidence.
Atop HHS, Kennedy has taken a number of actions to put his vaccine skepticism into practice.
In August, the Food and Drug Administration revised guidance on COVID-19 shots, choosing to narrow eligibility for adults and children. The FDA previously cleared annual COVID-19 shots for most people.
The Centers for Disease Control and Prevention’s Advisory Committee on Immunization Practices, or ACIP, could soon endorse the FDA’s view. Kennedy removed every ACIP member in June, later installing appointees considered vaccine skeptics. Kennedy said the decision would restore public trust in vaccines and ensure the CDC does not “function as a rubber stamp for industry profit-taking agendas.”
The Affordable Care Act of 2010 requires insurance plans to cover vaccinations ACIP endorses without cost-sharing. Absent that imprimatur, insurers could opt to drop coverage of vaccines or subject them to cost-sharing requirements.
“I think the question now is, in the absence of ACIP recommendations, what do payers have to do or should they do?” said Richard Hughes, an attorney at Epstein Becker & Green and former Moderna executive. Hughes is optimistic insurers will continue covering vaccines, he said.
Health insurance companies will make coverage decisions based on medical evidence from a variety of sources, “including but not limited to ACIP,” said a spokesperson for the health insurance trade group AHIP.
“The cost of vaccines … they’re relatively small compared to the thousands of dollars associated with hospitalizations, [emergency department] visits or rehospitalizations,” said Karen Ignagni, executive chair of the nonprofit insurer EmblemHealth.
To date, insurance companies have remained quiet about their intentions. UnitedHealthcare parent company UnitedHealth Group, Humana, Cigna, Aetna parent company CVS Health and several regional Blue Cross and Blue Shield insurers declined interviews or did not respond to requests for comment.
Employers navigate uncertainty
Recent developments are also causing an unwelcome headache for employers that sponsor health benefits.
“My expectation is that most employers will likely keep doing what they’re doing,” said Shawn Gremminger, CEO of the National Alliance of Healthcare Purchaser Coalitions, an umbrella group of associations that represent employers. “But it’s creating a lot of angst and anxiety in a world that used to be a fairly straightforward part of what we have to do,” he said.
While it’s commonplace for health insurance companies to consider outside guidance from medical associations, Democrat-led states are forming coalitions in response to Kennedy’s sweeping changes to vaccine policy.
Led by the governors of California, Hawaii, Oregon and Washington, the West Coast Health Alliance promises vaccine guidance based on “science, not politics.”
Massachusetts is working to form a similar coalition among Northeastern states. The Bay State recently informed insurers they must cover vaccines recommended by the state public health department. Blue Cross Blue Shield of Massachusetts supported the guidance, according to Democratic Gov. Maura Healey’s office.
Large, multistate employers may find these coalitions muddy rather than clarify vaccine policy, Gremminger said.
“The last thing you want is to have 10 different plan designs based on the 10 different states you operate in,” Gremminger said. “State governments don’t get to tell self-funded multistate employers what they have to or cannot cover within their health plan.” Employee benefits generally are subject to federal law, not state law.
Insurers determine best approach
A number of factors will influence whether insurers maintain the status quo despite new federal policy. While they need to comply with state and federal laws, they have other considerations.
Health insurance companies will analyze how many members received vaccinations last year to help determine whether the upfront expense is justified by savings on costlier interventions to treat people who contract infectious diseases, said Jennifer Kates, director of the Global Health and HIV Policy Program at the healthcare research institution KFF.
Immunizations led to $540 billion in direct savings and $2.7 trillion in indirect savings from 1994 to 2023, the CDC estimated last year. Yet as of April, just 23% of U.S. adults received the most current COVID-19 vaccine, which costs up to $141 per dose.
Insurers may make decisions based on market competition, said Becky Sheppard, a member of the health practice council at the American Academy of Actuaries.
“If one insurer covers the vaccine and another insurer doesn’t, are they going to attract different people to their plans?” Sheppard said.
And if vaccines are covered for only certain segments of an insurer’s membership, there are administrative costs for backend systems that must be considered, Sheppard said.
Most people obtain booster shots at pharmacies, but federal changes have restricted access at retailers such as CVS Health and Walgreens in some states, which will result in more shots administered through prescriptions or even off-label use.
