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September 21, 2021

Costs of Preventable COVID-19 Hospitalizations During Summer Surge Exceed $5 Billion

Author Affiliations
  • 1Consulting Editor, JAMA Health Forum
JAMA Health Forum. 2021;2(9):e213612. doi:10.1001/jamahealthforum.2021.3612

With the growing numbers of hospitalized patients with COVID-19 over the summer—the majority of whom were not vaccinated against the coronavirus—the cost of these largely preventable hospitalizations for the months of June, July, and August soared to more than $5 billion, an analysis from the Kaiser Family Foundation (KFF) has found.

“These COVID-19 hospitalizations are devastating for patients, their families, and health care providers,” the report’s authors said. “The hospitalizations are also costing taxpayer-funded public insurance programs and the workers and businesses paying health insurance premiums.”

Free COVID-19 vaccines have been largely available to US adults since mid-April 2021, which means that most adults in the country have had the opportunity to be fully vaccinated with a 2-dose vaccine by late May 2021. However, the analysis notes, vaccinations “lagged after mid-April, with a slight increase in July and August.”

As of early September, one-quarter of adults aged 18 or older were still unvaccinated, even as COVID-19 cases, hospitalizations, and deaths surged, fueled by the spread of the more infectious Delta variant.

The new report focused on adults hospitalized with confirmed COVID-19 during the summer months. Children were excluded from the analysis because many remain ineligible for COVID-19 vaccines.

Based on data from the US Department of Health and Human Services and the Centers for Disease Control and Prevention, the authors estimated that the vast majority (98.6%) of people hospitalized with COVID-19 in June through August were not vaccinated. After adjustments for various factors, the authors made a “conservative” estimate that approximately 84% of hospitalizations primarily for COVID-19 in that 3-month period were preventable with vaccination. This translated to 32 000 preventable COVID-19 hospitalizations among unvaccinated US adults in June, 68 000 in July, and 187 000 in August, for a total of 287 000 hospitalizations over the 3-month period.

Various sources suggest that the average cost of COVID-19 hospitalization is approximately $20 000. “If each of these preventable hospitalizations cost roughly $20 000, on average, that would mean these largely avoidable hospitalizations have already cost billions of dollars since the beginning of June,” the authors wrote, or about $5.7 billion for June through August.

The new analysis also found that in August alone, the preventable costs of treating unvaccinated patients in hospitals totaled an estimated $3.7 billion, nearly twice the estimated cost for June and July combined.

“Still, this ballpark figure is likely an understatement of the cost burden from preventable treatment of COVID-19 among unvaccinated adults,” the KFF authors said, noting that “there is reason to believe average costs for COVID-19 hospitalizations may be even higher than $20 000 based on other studies” of patients covered by private insurance and Medicare.

They also pointed to a recent memo from Delta Air Lines Chief Executive Officer Ed Bastian to employees, noting that the average hospital stay for COVID-19 has cost Delta Air Lines $50 000 per person and that the company will require workers who have not been vaccinated against SARS-CoV-2 and who are enrolled in the company’s health insurance plan to pay a $200-monthly surcharge.

In addition, the KFF report said, the $5.7 billion figure for COVID-19 hospitalization during June through August did not include the “likely substantial” cost of outpatient treatment.

The authors cite a Medicare study showing that patients with COVID-19–related hospitalizations had multiple outpatient visits (more than 3 on average) costing approximately $164 each. In addition, an analysis of patients covered by private insurance or Medicare found that COVID-19 outpatient treatment costs can average $500 to $1000 per patient, they said.

Patients themselves typically pay only a small proportion of the cost of a COVID-19 hospitalization. The KFF analysis explains that under the Affordable Care Act and other laws, insurers are not permitted to charge higher premiums to unvaccinated individuals, but notes that employers could impose higher costs.

Early in the pandemic, the majority of people enrolled in fully insured private health plans had their out-of-pocket costs waived if they were hospitalized with COVID-19. However, some insurers began to phase out cost-sharing waivers for COVID-19 treatment in November 2020, and now the majority of private insurers have dropped such waivers.

On September 9, President Biden announced that the Department of Labor is developing an emergency rule “to require all employers with 100 or more employees, that together employ over 80 million workers, to ensure their workforces are fully vaccinated or show a negative test at least once a week.”

The federal government still requires insurers to cover the cost of COVID-19 tests and waive cost sharing for tests performed for the purpose of individualized diagnosis. But insurers are not required to cover the cost of COVID-19 testing for employment purposes.

“Unvaccinated workers may be required to get COVID-19 tests regularly to physically return to work, and insurers may shift some or all costs for those tests to the workers,” the KFF authors note. “Adults can largely avoid these out-of-pocket costs and severe illness by getting the free vaccine.”

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Article Information

Published: September 21, 2021. doi:10.1001/jamahealthforum.2021.3612

Open Access: This is an open access article distributed under the terms of the CC-BY License. © 2021 Stephenson J. JAMA Health Forum.

Corresponding Author: Joan Stephenson, PhD, Consulting Editor, JAMA Health Forum (Joan.Stephenson@jamanetwork.org).

Conflict of Interest Disclosures: None reported.

2 Comments for this article
These Costs are Expected From Years of Enabling Policies
Shawn Baca, MD, FACR | Rheumatology
This is not surprising. Health care policy for decades has been based on charging people based on community ratings and not individual habits. This unfairly places more financial burden on those that take care of themselves. In theory, we would like to protect people w pre-existing disease. However, even prior to the Covid-19 epidemic, 2/3 of hospitalizations could be attributed to poor personal habits, obesity, poor diet, lack of exercise, smoking, drugs, non adherence, etc. Politicians will never ever have the courage to distinguish that there is a difference between self-induced pre-existing conditions and non-self-induced ones such as MS, lupus, certain cancers, etc.
Cues for Another Article?
Arturo Fanciulli, Masters Degree in Economics | Norfolk and Norwich University Hospital, UK
It looks like the article encourages the public to be vaccinated because of the financial burden of this decision on the community. The health side of not being vaccinated is discussed/studied in other research.

When it comes to costs, though, I think we should put on the other side of the scale a few items:

- The cost of the vaccine itself (how much the producers charge the community, now 2x/3x, maybe more per product);
- The cost of the vaccination programme, including the staff involved, transport, ad hoc clinics, and so on;
- The cost of
hospitalizations, visits to GPs, and A&E (emergency care) because of vaccination adverse events (some of them, I agree, are not cause-effect proven)

Of course this was not the purpose of this specific research.

There is one thing that is sure: hospitalisation in the US costs a lot of money, perhaps too much.