Billions of dollars spent on hospitalization for unvaccinated patients

A joint study done by the Peterson Center on Healthcare and the Kaiser Family Foundation estimates that preventable hospitalizations required by patients who are unvaccinated against COVID-19 have cost upwards of $5 billion.

Taxpayers, whether through publicly funded health plans or through increased rates of private insurance, are ultimately picking up the tab for these avoidable expenses.

Despite the availability of safe and effective COVID-19 vaccines, vaccination rates have lagged, particularly in some states and among younger people. As of early September 2021, 25% of adults over the age of 18 in the U.S. remain unvaccinated for COVID-19. As a result of lagging vaccinations and the more infectious delta variant, COVID-19 cases, hospitalizations, and deaths are increasing.

Not only are these COVID-19 hospitalizations devastating for patients, their families, and health care providers, but it is putting financial strain on payers. As a result, insurers are beginning to reinstate cost-sharing for COVID-19 treatment, though patients still only pay a small share of the total costs. The study estimates that the average hospitalization for COVID-19 about $20,000, though the costs for those requiring a ventilator are much higher.

The analysis of HHS and CDC data indicates there were 32,000 preventable COVID-19 hospitalizations in June, 68,000 preventable COVID-19 hospitalizations in July, and another 187,000 preventable COVID-19 hospitalizations among unvaccinated adults in the U.S. in August, for a total of 287,000 across the three months.

If each of these preventable hospitalizations cost roughly $20,000, on average, that would mean these largely avoidable hospitalizations have already cost more than $5 billion since the beginning of June.

The study authors say this figure is likely an understatement of the cost burden from preventable treatment of COVID-19 among unvaccinated adults, because it does not include the cost of outpatient treatment, which is likely substantial. A Medicare study found patients with COVID-related admissions had multiple outpatient visits (3.2 on average) that cost approximately $164 each (and this is only for those COVID-19 patients who were hospitalized at one point). An analysis of the privately insured found COVID-19 outpatient treatment costs can average $500-$1,000 per patient. In addition, there is reason to believe average costs for COVID-19 hospitalizations may be even higher than $20,000 based on other studies of privately insured and Medicare. One study that has not yet been peer reviewed found that while the median hospitalization costs private payers $25,339, the mean cost was $42,200. Similarly, in their justification for charging higher premiums to unvaccinated employees, Delta Airlines said their average hospitalization cost was $50,000 (though it is unclear if this is the median or mean cost).

Additionally, although breakthrough infections and hospitalizations are rare, unvaccinated people are also more likely to spread the virus to those who have taken measures to protect themselves and others, and those costs are not included in the estimate.

This article was originally posted on Medical Economics®.