Treatment for COVID-19 May Result in Hefty Medical Bills for Employees as Insurance Companies Remove Waivers

By Kevin Marrs, courtesy of Approved Partner ASE

It is no secret that the COVID-19 pandemic has strained our healthcare system.  Now as the pandemic enters a new resurgence in the United States and hospitalizations increase, employers and their employees might be in for a surprise: hefty medical bills. 

Early in the pandemic, most insurers waived costs for approved testing, vaccinations, and medical treatment.  However, a recent survey by the Kaiser Family Foundation revealed that because vaccines have become more widely available, most private insurers are no longer waiving the fees for medical treatment.

Across the two largest health plans in each state and D.C. (102 plans), 72% are no longer waiving out-of-pocket costs for COVID-19 treatment. Almost half these plans (50 plans) ended cost-sharing waivers by April 2021. Of the 29 plans still waiving cost-sharing for COVID-19 treatment, 10 waivers are set to expire by the end of October.

In 2020, the Michigan Department of Insurance and Financial Services (DIFS) announced that the state received agreements from nearly all of the state’s health insurance companies to waive costs associated with treatment for COVID-19. 

The Detroit News recently reported that starting in October, Blue Cross Blue Shield of Michigan will no longer waive the costs of treatment.  According to the insurer’s research, treatment for those unfortunate enough to end up in the ICU can reach as high $100,000.

As vaccines become widely available to adults in the United States and health care utilization rebounds, health insurers may no longer face political or public relations pressure to continue waiving costs for COVID-19 treatment.

The Kaiser Family found that the typical deductible in employer health plans is $1,644. Enrollees hospitalized with pneumonia, which requires a similar treatment to those hospitalized with COVID-19, paid an average of over $1,300 out-of-pocket. This cost could serve as an incentive for many to get vaccinated. Unvaccinated COVID-19 hospitalizations cost the U.S. health system $2.3 billion in June and July 2021.