The Centers for Medicare and Medicaid Services released an interim final rule Oct. 28 saying that Medicare will cover vaccines that receive U.S. Food and Drug Administration authorization — including those that get emergency use authorization — at no cost to beneficiaries.
Drug development companies around the world are racing to create a vaccine to prevent Covid-19. Though U.S. officials expect insurers to cover the vaccine at no cost to beneficiaries, it was not clear if the country’s largest insurer, Medicare, would do so. The agency would not cover drugs approved under the FDA’s emergency use designation, the Wall Street Journal previously reported.
At the HLTH conference in mid-October, CMS Administrator Seema Verma promised policy changes, saying: “We’ve figured out a path forward. It’s clear Congress wants to make sure Medicare beneficiaries have this vaccine and that there isn’t any cost sharing.”
And the agency appears to be delivering on this promise.
Per the rule, Medicare will cover any vaccine approved by the FDA, either through an emergency use designation or licensed under a biologics license application.
“The rule removes any ambiguity around CMS’ coverage of the Covid-19 vaccine,” Verma said during an Oct. 28 press call.
There will be no out-of-pocket cost for the vaccine for Medicare and Medicare Advantage beneficiaries, and “surprise or balance billing for vaccine costs is strictly prohibited,” she said.
CMS has set the price point for the vaccine; it will pay about $28 to administer single-dose vaccines. For vaccines that require two or more doses, it will pay around $17 for the first dose or the first few doses and $28 for the final dose in the series. This would amount to about $2.6 billion if all the roughly 67 million seniors enrolled in Medicare got vaccinated, Verma said.
The new rule would also make it easier for hospitals to get paid when they treat Covid-19 patients with new products or treatments. Usually, hospitals get a fixed payment for inpatient services, even if their costs exceed that figure. Hospitals may apply for “outlier payments,” but only when their costs exceed $30,000.
Under the new rule, hospitals would qualify for those outlier payments when they treat patients with new therapeutics approved for Covid-19, even if their costs for providing the treatment do not reach the $30,000 threshold.
CMS also released toolkits for Medicaid agencies, providers and health plans to guide them as they administer and bill for the coronavirus vaccine.
The interim final rule will be available on the federal register for a 30-day comment period.
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