The roll-out of vaccine approvals has led to some confusion over what charges consumers might be asked to cover. This echoes the confusion previously discussed with respect to COVID-19 diagnostic and antibody test pricing. But consumers, providers, and others that will have any involvement with vaccine production, distribution, or administration should be aware that the Coronavirus Aid, Relief, and Economic Security (CARES) Act provides different rules for treatment (including testing) than it does for preventative care, like the recently approved vaccines.   

The CARES Act provides that all insurance plans that are subject to the Affordable Care Act’s preventative services coverage standards must cover any qualifying coronavirus preventive services, including approved vaccines, without cost-sharing. It also provides that Medicare plans must cover the cost of the COVID-19 vaccine and its administration, without cost-sharing. This coverage applies to both in- and out-of-network providers. In short, if the primary purpose of a medical visit is to receive a covered vaccine, then the vaccine recipient should not be responsible for any out of pocket costs. However, if their appointment or doctor’s visit includes health services unrelated to COVID-19—such as bloodwork—the recipient may be charged for those services.

Notably, federal rules require that coverage must begin to apply within 15 days of a vaccine’s approval by the Advisory Committee on Immunization Practices (ACIP), accelerating the usual timeline required for plans to incorporate a new recommendation. Insurance plans are therefore currently required to cover the cost of both of the vaccines that have been approved in the United States. (The ACIP provided its interim recommendation for the Pfizer-BioNTech COVID-19 vaccine on December 12, 2020 and subsequently issued its interim recommendation for the Moderna COVID-19 vaccine on December 19, 2020.)

Not all health care plans are covered by these requirements. Plans that are not subject to the ACA’s preventative services coverage standards are not subject to the CARES Act and its vaccine coverage requirement. These plans—which could include short-term health plans, fixed indemnity plans, or some grandfathered plans—may take varying approaches to vaccine coverage. It appears that these plans can require that beneficiaries pay cost sharing for vaccines or can exclude recommended vaccines from coverage altogether. Individual states may ultimately require plans to cover the vaccine and waive cost-sharing. Alternatively, the plans may decide, for any number of reasons (including, e.g., concerns about employee health and safety) to provide coverage, though they may or may not decide to waive cost-sharing. At least one such plan has already said that COVID-19 vaccine costs will be “shareable.”

Several open questions remain. First, it is unclear how much the vaccine could cost (either to recipients or to insurers) in the future, following the conclusion of the public health emergency.

Second, uninsured vaccine recipients may see differences in billing in the long term. Providers that administer an approved COVID-19 vaccine to uninsured recipients will be reimbursed for vaccine administration costs through a provider relief fund created by the CARES Act. The federal government has not indicated how it will handle these reimbursements if that relief fund should be depleted.

Third, because vaccine coverage arises from the ACA’s preventative services coverage standards, the Supreme Court’s forthcoming decision on a pending challenge seeking to invalidate the law’s individual mandate could greatly impact this area, and potentially eliminate or reduce cost coverage.

Finally, and of particularly salience for price gouging concerns, even though the vaccine itself is free, vaccine recipients might still see bills. Some providers can legally charge an administration fee for giving the shot, according to the CDC. Those providers can seek reimbursement for such a fee from either the recipient’s “public or private insurance company or, for uninsured patients, by the Health Resources and Services Administration’s Provider Relief Fund.” Several states prohibit price gouging for medical services, and it remains to be seen whether and how any fees could be justified or challenged under different state laws.

In summary, most but not all COVID vaccines costs should be covered without cost sharing to recipients, related additional charges for the treatment visit might not be covered, and all the non-covered charges likely are subject to state price gouging laws.

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Visit Proskauer on Price Gouging for antitrust insights on COVID-19.

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Proskauer’s cross-disciplinary, cross-jurisdictional Coronavirus Response Team is focused on supporting and addressing client concerns. Visit our Coronavirus Resource Center for guidance on risk management measures, practical steps businesses can take and resources to help manage ongoing operations.

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Photo of Kelly Landers Hawthorne Kelly Landers Hawthorne

Kelly Landers Hawthorne is an associate in the Litigation Department and a member of the Antitrust and Product Liability groups. She represents clients in litigations and due diligence across a range of industries, including consumer products, life sciences, healthcare, education, hospitality, sports and…

Kelly Landers Hawthorne is an associate in the Litigation Department and a member of the Antitrust and Product Liability groups. She represents clients in litigations and due diligence across a range of industries, including consumer products, life sciences, healthcare, education, hospitality, sports and entertainment.

Kelly also maintains a diverse pro bono practice. She received Proskauer’s Golden Gavel Award for excellence in pro bono work in 2019.

She is a frequent contributor to Proskauer’s Minding Your Business blog, where she authors articles related to price gouging issues.

Kelly is also a member of the Proskauer Women’s Alliance Steering Committee, where she serves on subcommittees focused on highlighting and providing professional development opportunities for women at the firm.

Prior to her legal career, Kelly was a Teach For America corps member and taught middle school in Washington, DC.

While at Columbia Law School, Kelly served as an articles editor of the Columbia Journal of Law & the Arts and interned for the Honorable Sandra Townes of the U.S. District Court for the Eastern District of New York.

Photo of John R. Ingrassia John R. Ingrassia

John is a partner at the Firm, advising on the full range of foreign investment and antitrust matters across industries, including chemicals, pharmaceutical, medical devices, telecommunications, financial services consumer goods and health care. He is the first call clients make in matters relating…

John is a partner at the Firm, advising on the full range of foreign investment and antitrust matters across industries, including chemicals, pharmaceutical, medical devices, telecommunications, financial services consumer goods and health care. He is the first call clients make in matters relating to competition and antitrust, CFIUS or foreign investment issues.

For more than 25 years, John has counselled businesses facing the most challenging antitrust issues and helped them stay out of the crosshairs — whether its distribution, pricing, channel management, mergers, acquisitions, joint ventures, or price gouging compliance.

John’s practice focuses on the analysis and resolution of CFIUS and antitrust issues related to mergers, acquisitions, and joint ventures, and the analysis and assessment of pre-merger CFIUS and HSR notification requirements. He advises clients on issues related to CFIUS national security reviews, and on CFIUS submissions when non-U.S. buyers seek to acquire U.S. businesses that have national security sensitivities.  He also regularly advises clients on international antitrust issues arising in proposed acquisitions and joint ventures, including reportability under the EC Merger Regulation and numerous other foreign merger control regimes.

His knowledge, reputation and extensive experience with the legal, practical, and technical requirements of merger clearance make him a recognized authority on Hart-Scott-Rodino antitrust merger review. John is regularly invited to participate in Federal Trade Commission and bar association meetings and takes on the issues of the day.

Photo of Christopher E. Ondeck Christopher E. Ondeck

Chris Ondeck is co-chair of the Firm’s Antitrust Group and co-head of the Washington DC office. He represents clients in complex antitrust and consumer protection litigation, defends mergers and acquisitions before the U.S. antitrust agencies, represents companies involved in government investigations, and counsels…

Chris Ondeck is co-chair of the Firm’s Antitrust Group and co-head of the Washington DC office. He represents clients in complex antitrust and consumer protection litigation, defends mergers and acquisitions before the U.S. antitrust agencies, represents companies involved in government investigations, and counsels on antitrust compliance. Chris is also the founder and leader of the firm’s Price Gouging Practice, and is one of the key thought leaders in this space.

Chris handles antitrust matters for clients in a number of industries, including food and agriculture, financial services, media, telecom, technology, e-commerce, consumer products, natural resources, oil and gas, chemicals, and pharmaceuticals.  He also serves as outside counsel to a large number of industry groups, including trade associations and cooperatives.

Chris has been recognized as a leading antitrust practitioner by Chambers, noting that clients describe him as “our primary thought partner – he’s very good at explaining the complex issues and making them easy to understand” and praising “his strong advocacy skills”; by The National Law Review as a “Go To Thought Leader 2020”; by Acritas as a “Star” in multiple years; by Benchmark Litigation as a National Litigation Star 2021; and by The Legal 500 United States for Antitrust: Civil Litigation/Class Actions.