[Editor's note: This story originally was published by Real Clear Health.]
By Doug Badger
Real Clear Health
The U.S. Food and Drug Administration will convene an expert advisory panel in April to consider requests from Pfizer and Moderna to authorize a fourth dose of their COVID-19 vaccines. Pfizer is seeking authorization for people aged 65 and older.
Seniors have proven especially vulnerable to serious illness and death from COVID-19 and Pfizer cited data indicating that the effectiveness of a third dose of its vaccine waned after three to six months.
Congress had the foresight to put payment for COVID-19 vaccines into Medicare Part B where Medicare beneficiaries receive the vaccines without cost sharing. Presumably, Congress knew that subjecting seniors to out-of-pocket costs could compromise their ability to get the COVID shots.
Unfortunately, Congress isn’t applying this same rule to other preventive vaccines.
In fact, Medicare is the only form of public or private insurance that doesn't make all preventive vaccines free at the point of service.
Congress should change this policy.
Medicare's coverage of preventive vaccines is haphazard. It covers some immunizations under Part B and others under the Part D prescription drug plan. Beneficiaries are not responsible for cost sharing for Part B vaccines. Most Part D plans require cost sharing, with amounts varying by plan and product.
The distinction between vaccines that are free to seniors and which require some cost sharing appears arbitrary, at best. Flu shots and COVID-19 shots are free. Shingles shots are not. A tetanus shot? It depends. If you step on a nail, you won't have a copay. But if you're getting a needed booster, it will cost you.
The cost can be significant. Beneficiaries can face bills of $350 or more for a two-dose course of a shingles vaccine, for example.
People with private coverage don't face such bills. The government requires most insurers to cover preventive vaccines without cost-sharing.
Medicare's confusing rules on coverage of preventive vaccines begs an important question, the answer to which appears to have no medical basis: "Why do some vaccines for seniors require cost sharing and others not?"
Medicare's policy is short sighted. Insurers use cost sharing to discourage the excessive and inappropriate use of medical goods and services.
It makes little sense for Medicare beneficiaries to have "skin in the game" for preventive vaccines. There is no risk that patients will over-vaccinate. Pharmacists, doctors and other providers generally adhere to CDC recommendations in administering vaccines. Medicare only covers vaccines that are consistent with these recommendations. Once a beneficiary gets two doses of the shingles vaccine, the course is complete. Medicare wouldn't cover a third dose unless CDC revises its recommended vaccine schedule.
Cost-sharing requirements are counterproductive since they are among the factors that affect vaccine uptake. Eliminating those requirements is especially important for seniors who are generally more susceptible to severe illness from vaccine-preventable diseases.
The Medicare Payment Advisory Committee (MedPAC), a group that advises Congress on Medicare policy, examined take-up rates for vaccinations between pneumococcal vaccines—which are free to beneficiaries under Part B—and shingles vaccines, which require copayments under Part D.
It found that 59% of seniors had received the pneumococcal vaccine in 2017 or earlier. By contrast, only 32% of beneficiaries received shingles shots between 2010 and 2018. In 2018, just 4% of beneficiaries got shingles shots.
Requiring cost sharing for preventive vaccines thus discourages their appropriate use, not inappropriate use.
There are two broad options for fixing Medicare's broken policy: Eliminating Medicare Part D cost sharing for preventive vaccines or covering the vaccines under Part B, which does not require cost sharing.
Each approach has pros and cons, but both would remove a barrier to seniors getting immunized and result in higher vaccination rates. They thus can be expected to reduce what Medicare spends on treating patients with preventable diseases.
Most analysts believe that eliminating these cost-sharing requirements would increase Medicare spending on net. They disagree over the size of the increase and the extent to which spending more on immunizations would be offset by spending less to treat diseases that vaccines prevent. But they generally agree that the cost of vaccinating more seniors will outweigh the savings on physician and hospital services.
Given the perilous state of Medicare financing, any coverage expansion of preventive vaccines should include broader Medicare reform provisions to offset those costs.
Preventive vaccines provide enormous benefits to seniors, reducing the risk of hospitalization and death caused by influenza, pneumonia, shingles, COVID-19 and other diseases.
Medicare should maximize the benefits of vaccines to seniors by eliminating cost-sharing for all current and future preventive immunizations and enacting provisions that offset the new spending.
Doug Badger is a senior fellow at the Galen Institute, a public policy research organization focusing on patient-centered health reform.
[Editor's note: This story originally was published by Real Clear Health.]
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