News: Uninsured COVID-19 hospital reimbursement may total $42 billion

Estimates from the Kaiser Family Foundation found that hospital reimbursement for treatment of uninsured COVID-19 patients may account for more than $40 billion of the $100 billion designated for hospitals in the latest coronavirus stimulus package.

The brief estimated that total hospital reimbursement could range between $13.9 billion and $41.8 billion depending on the rate and severity of COVID-19 hospitalizations among the uninsured population. Researchers estimated that between 670,000 and 2 million uninsured individuals could require hospitalization for COVID-19.

This reimbursement range is based on Medicare reimbursement for admissions for similar conditions (including respiratory infections and inflammations with major comorbidities), which averages just over $13 thousand. In more severe cases, respiratory system diagnosis with ventilator support for greater than 96 hours which averages over $40 thousand.

The Department of Health & Human Services (HHS) announced the intention to use emergency funding from the Coronavirus Aid, Relief and Economic Security Act (CARES) to reimburse hospitals for treating uninsured COVID-19 patients.

Critics of the announcement, such as the American Hospital Association, say that funding for healthcare providers from the CARES Act should not to toward providing coverage for treatment of the uninsured, stating that “the emergency relief fund in the CARES Act was intended to provide hospitals with an infusion of emergency relief as providers incur substantial expenses in preparing and dealing with fighting this battle against COVID-19.”

HHS intends for the new hospital reimbursement policy to help hospitals cover costs of COVID-19 treatment, but whether the payments will be enough to cover hospitals’ overhead expenses remains unclear.

Researchers stated the policy could account for an even greater portion of the $100 billion, noting that more of the emergency funding may need to go toward hospital reimbursement for uninsured COVID-19 patient care if high wage areas experience a larger surge of uninsured patients.

HHS has not yet released more detailed on how it plans to distribute emergency funds from the CARES Act.

Editor’s note: The Kaiser study can be found here. The AHA statement can be found here. To read ACDIS’ coverage of the COVID-19 pandemic, click here.