With the anticipated end of the federal public health emergency (PHE) in May and the absence of continued federal funding, COVID-19 vaccines will shift from being purchased by the federal government (and available to individuals at no cost) to the same vaccine purchasing, distribution and administration process used for routine vaccinations.
This imminent shift will pose significant cost and access barriers for individuals, particularly for those who are underinsured or uninsured or face difficulties in accessing a regular health care provider. With historically marginalized populations disproportionately represented among the uninsured, increased barriers to access among this population threaten to exacerbate COVID-19 health disparities. This blog highlights the potential impacts that state officials may anticipate and respond to as COVID-19 vaccines shift to the commercial market.
Increased Cost Barriers for Underinsured and Uninsured Populations
Traditionally, vaccines in the United States are paid for in one of three ways — through an individual’s private insurance plan; through publicly-funded programs such as Medicare, Medicaid, and the Vaccines for Children (VFC) program; or directly by consumers. COVID-19 vaccines became the exception to the rule in late 2020, with the federal government taking on the burden of the cost of development, distribution, and administration of COVID-19 vaccines across the country.
During the PHE, public and private insurers were required to cover the administration of COVID-19 vaccines with no cost sharing. Provisions in the Coronavirus Aid, Relief, and Economic Security (CARES) Act, American Rescue Plan Act, and Inflation Reduction Act ensure that public and private insurers will continue to cover COVID-19 vaccines (see Figure 1).
Figure 1: Continued Coverage for COVID-19 Vaccines across Public and Commercial Insurers
- Commercial Health Plans: The Affordable Care Act (ACA) requires commercial health plans to cover all vaccines recommended by the Advisory Committee on Immunization Practice (ACIP) (although grandfathered plans are exempt from this requirement). ACIP recommended COVID-19 vaccines be added to the 2023 childhood and adult immunization schedules in October 2022.
- Medicare: While most Medicare recipients have vaccine coverage under Medicare Part D, the CARES Act placed FDA approved COVID-19 vaccines under Medicare Part B coverage. This ensures access to COVID-19 vaccines for seniors covered by Medicare after the supply of federally funded vaccines has been exhausted.
- Medicaid: The Inflation Reduction Act and American Rescue Plan Act require that Medicaid and the Children’s Health Insurance Program (CHIP) continue to cover ACIP-recommended vaccines with no cost sharing after the PHE ends.
- Vaccines for Children (VFC) Program: In October 2022, ACIP recommended adding COVID-19 vaccines to the VFC program, ensuring children ages 6 months through 18 years who are insured by Medicaid, uninsured or underinsured, American Indian, or Alaska Native will continue to receive COVID-19 vaccines at no cost.
However, individuals who are underinsured and uninsured will face steep increases in out-of-pocket costs, resulting in increased barriers to access. The impact of increased out-of-pocket costs will also be compounded by significant price increases for COVID-19 vaccines on the commercial market, which are expected to rise as high as $130 per dose for Pfizer and $115 per dose for Moderna.
While the federal government provides limited funding to public health agencies and safety net providers to provide ACIP-recommended vaccines to uninsured adults under Section 317 of the Public Health Service Act, these funds will not be sufficient to cover the estimated $2.3 billion cost of providing commercial COVID-19 vaccines to the underinsured and uninsured. A handful of states, including Virginia and New York, have Vaccines for Adults programs that provide uninsured and underinsured adults with most or all vaccines recommended by ACIP at no cost, although it is unclear whether COVID-19 vaccines will be provided through these programs.
With limited resources leaving significant gaps in covering COVID-19 vaccines for the underinsured and uninsured, these populations will be at higher risk of not receiving vaccines in the future, putting them at a higher risk of complications, hospitalizations, and deaths from COVID-19. To address these challenges, states can blend and braid remaining COVID-19 supplemental or state funding to ensure continued vaccine access for under-vaccinated communities, as well as redouble efforts to partner with federally qualified health centers (FQHCs) and community-based organizations to reach individuals from historically marginalized communities.
Reduced Access to COVID-19 Vaccines for Children in Pharmacy Settings
During the COVID-19 pandemic, pharmacies played a critical role in providing COVID-19 vaccinations to people of all ages, with more than 80 percent of COVID-19 vaccines administered to commercially-insured children occurring in a pharmacy setting. Access to vaccination in a pharmacy setting is particularly important for individuals who may lack access to a regular medical provider or who may need to receive vaccinations outside of regular working hours.
While state scope of practice laws vary in terms of pharmacists’ authority to administer vaccinations to children under age 18, the Public Readiness and Emergency Preparedness (PREP) Act preempted these rules, granting pharmacies liability protections for providing COVID-19 and routine childhood vaccinations to children as young as age 3. With liability protections under the PREP Act set to expire, the ability of pharmacists to administer vaccines to children will end in all but the 25 states that allow pediatric vaccination in pharmacies for children 3 years and older. This will result in restricting many pharmacists from providing vaccinations to children, regardless of insurance coverage.
For children living in vaccine deserts where a COVID-19 vaccine is not available within a 30-minute drive, the loss of access through pharmacies means these children may remain unprotected. To mitigate the impact of these changes, states legislatures may consider codifying the PREP Act or amending scope of practice laws that authorize pharmacists to administer vaccines without a prescription to children of all ages.
Additionally, state officials can work to expand pediatric access to COVID-19 vaccines in pharmacy settings by encouraging pharmacies to participate in the VFC program. While COVID-19 vaccines will continue to be provided to children under the VFC program once commercialized, very few pharmacies participate in the program. That means that, even if state laws permit vaccination of children in pharmacy settings, children covered by the VFC program will no longer have access to COVID-19 vaccinations through most pharmacies once the vaccines move to the commercial market. Key to closing the access gap for children is the recruitment of vaccinators, including those located in schools and pharmacies, to the VFC program, especially in areas where access is currently limited.
Increased Provider Burdens
While vaccine providers were permitted to charge insurers fees for their administration of COVID-19 vaccines, the vaccines themselves were provided at no cost to both providers and consumers. Routinely recommended vaccines for insured individuals are typically purchased by health care providers and billed to commercial insurance, Medicare, or Medicaid.
With the increased cost of COVID-19 vaccines upon commercialization, medical providers, especially those from smaller practices, may not want to take on the financial risk for upfront purchasing of vaccines. These challenges may be particularly acute for pediatric providers who must purchase multiple preparations for each pediatric age group in multi-dose vials at a greater risk of being wasted. Providers may also face additional challenges being reimbursed for vaccines if there are delays in adoption of billing codes for newly commercialized vaccines, resulting in increased provider reluctance to store and administer COVID-19 vaccines.
While some of these challenges may be addressed by manufacturers shifting to a single bivalent vaccine preparation, as well as the availability of single-dose vials across all pediatric age groups, states can still work with providers to address burdens related to vaccine purchasing and reduce stress on an already fragile pediatric health care system.
To address financial burdens to providers, states can consider adopting a “universal purchase program” for childhood vaccines whereby states collaborate with health insurers and government agencies to fund the purchase of vaccines at discounted rates, providing them to health care providers at no cost. Through these programs, provider costs are significantly lowered, and children (and sometimes adults) have access to all ACIP-recommended vaccines, regardless of insurance status. Such programs have been operated with success in 14 states, including Alaska, Maine, Rhode Island, Vermont, New Hampshire, and Washington. A 2020 impact analysis of Maine’s universal purchase program determined the state’s program saves insurance providers more than $4 million annually.
Looking Forward
With the end of universal federal vaccine purchase, uninsured and underinsured individuals across the United States will face increased out-of-pocket costs for COVID-19 vaccines. While COVID-19 vaccines will continue to be covered for most insured individuals, costs may be prohibitive for those without insurance, and the burden of upfront purchasing may dissuade providers from stocking and carrying vaccines. These increased barriers to access threaten to further exacerbate disparities in COVID-19 outcomes, including for historically marginalized populations.
With a sustained commitment to equity, many states are continuing to leverage available federal and states resources to engage communities that continue to face barriers to vaccination and health care access. To reduce the impact of commercialization on vaccine access for these communities, states can work with partners such as FQHCs and other safety net providers as well as community-based organizations to address the pending loss of COVID-19 vaccine access for certain populations.
States can also work with payers and provider associations to address barriers to vaccination and foster conversations between pharmacy associations, the state’s VFC program, and Medicaid to determine how pharmacies and other “non-traditional” pediatric vaccinators can become VFC providers, expanding access not only to COVID-19 vaccines but to all recommended childhood vaccines.
