Large Percentage of People Unexpectedly Charged for COVID-19 Care

Unexpected medical charges, or "surprise bills," add to the financial burden that many people contend with when trying to pay for healthcare.

But even though steps were taken to help mitigate expenses related to COVID-19, surprise bills did not vanish and a sizeable percentage of people were charged for treatment, vaccines, and testing — and didn't expect to be, according to a new survey.

Half of all respondents reported paying for at least one COVID-19 test administered at a health clinic, government site, or pharmacy, while 42% said that they had paid for their vaccines, despite advertisements and assurances that these services were free of charge.

Most of the people were surprised at being charged; 43% reported that they were unaware they would be charged for the vaccine whereas 38% didn't know they would be charged for a COVID-19 test. In addition, of the 70% who reported paying for COVID-19 treatment, 42% didn't know that they would be charged for it.

The survey was commissioned by AffordableHealthInsurance.com, an online resource for individuals shopping for private health insurance and Medicare Advantage plans. It was conducted online this past December 27 and included 1250 American adults.

"The impetus for this piece was the prevalence of surprise medical bills, and Americans' concerns about them, in general," said Kristen Scatton, a spokesperson for Affordablehealthinsurance.com. "The digital content team for AffordableHealthInsurance.com decided to focus the survey and article on surprise medical bills for COVID-related care due to the timeliness and relevance of the topic."

Anecdotal discussions about people receiving surprise bills for COVID tests also led to the line of questioning about how common of an issue this is. Scatton also emphasized that the survey was conducted anonymously so it was not possible to contact participants to gain more information about their experiences with payment, and participants were also not asked where they received the vaccine or testing.

Free Vaccines?

'Surprise billing' refers to a situation in which an insured patient receives an unexpected medical bill, which is often the result of having received service from an out-of-network facility, or by out-of-network clinicians. However, the survey did not ask respondents the reasons for their out-of-pocket expenses.

"It is puzzling why people would be charged for vaccines," said Jack Hoadley, PhD, Research Professor Emeritus in the Health Policy Institute at Georgetown University's McCourt School of Public Policy, Washington, DC. "The vaccines should be free, and they were all supposed to be available without cost sharing."

The federal government pre-paid for COVID-19 vaccines and required that vaccines be made available with no out-of-pocket costs and regardless of insurance status. Hoadley noted that since there is no information available as to where the vaccines were given, and under what circumstances, it is impossible to say why people were charged.

"The percentage of people reporting that they were charged is surprisingly large," he said. "And I can't imagine this happening at one of the mass vaccine facilities or pharmacies, which were set up to administer vaccines."

Hoadley speculated that one scenario would be if a person received the vaccine at the doctor's office, but the visit wasn't just for the vaccine. "They could have had a physical exam done, lab tests, and maybe the vaccine was mixed into that," he said. "It's difficult to say since there isn't supposed to be any charge for the vaccines."

About 10% of respondents who paid for a vaccine were charged $101-$200, whereas about 8% paid over $200. Individuals without health insurance were twice as likely to pay for the vaccine than those who were (68% vs 34%).

Charges for Testing

Charges for testing are a little more complicated. Hoadley explained that the initial legislation passed in 2020 — the Families First Coronavirus Response Act (FFCRA) and the Coronavirus Aid, Relief, and Economic Security (CARES) Act — required coverage for COVID-19 testing. This included the test itself, the related visit, and other services related to testing, and with no cost sharing. This was the case for most private health plans, as well as Medicare and Medicaid. Federal laws also made resources available to finance free testing for uninsured individuals.

But some plans denied claims or applied cost sharing if an individual was asymptomatic and had no known or suspected exposure, whereas some denied claims unless directly ordered by a clinician. Laws were clarified in early 2021 dictating that insurers must cover testing without cost sharing for asymptomatic individuals and without requiring medical screenings. However, cost sharing was permitted if testing was part of employee return-to-work programs or public health surveillance purposes. The cost of COVID-19 tests also lacks federal regulation, except for testing that is covered by Medicare.

What this means is that the cost of COVID-19 testing can fluctuate, similar to the way laboratories, hospitals, and other health related services can set their own rates. Some patients covered by a commercial plan may receive bills for COVID-19 diagnostic testing, and the amounts can vary widely between patients, especially those without insurance.

"Some entities may be exploiting the demand for testing, unfortunately," said Hoadley. "In other cases, people may have heard that free testing is available — that there are free testing centers — and think it applies everywhere. They also may not have asked questions about cost, assuming it was free."

Another reason for charges is the out-of-network scenario — if the test was conducted or read by an out-of-network lab. This was more of an issue earlier in the pandemic when fewer labs were processing the tests. The FFRCRA required insurers to cover the charges without cost sharing, but newer laws do not prohibit this practice.

In the survey, half of all respondents who received a COVID-19 at a clinic, government site, or pharmacy were charged for their test. Although roughly 10% paid between $1-$25 for their test, about 5% were charged more than $200. In addition, one third of respondents reported that they avoided getting a COVID-19 test because of cost. Those without insurance were more likely to avoid testing because of cost vs those with insurance (46% to 35%).

Surprise Billing During COVID-19

The survey found that a substantial proportion of patients (42%) who had been treated for COVID-19 infection didn't know that they would be charged for it, whereas 37% of those who knew they'd be charged didn't know how much they would have to pay for their treatment.

Out-of-pocket expenses related to treatment have been a concern throughout the pandemic. Earlier in the pandemic, an analysis from the Peterson Center on Healthcare and Kaiser Family Foundation reported that most patients (88%) with private insurance had their out-of-pocket costs waived if they were hospitalized with COVID-19. However, subsequent analysis showed that several of the insurers had begun to phase out COVID-19 cost-sharing waivers by November 2020.

Several states also required or created agreements with health plans to waive COVID-19 out-of-pocket treatment costs but there never was a federal mandate requiring insurers to do so.

A Harris Poll conducted on behalf of the American Heart Association (AHA) during the middle of the pandemic (October 12-14, 2020), and that included 2045 US adults ages 18 and older (1318 had received a surprise medical bill and 977 had private insurance), found receiving surprise medical bills posed a significant financial burden. Of the 68% with private insurance who received unexpected medical bill, a third were not able to pay the bill with money immediately available to them. Among those with private insurance who did not have money available, nearly one quarter (23%) reported that they had yet to pay the bill.

"Before 2022, more than half of all patients in the US had received a surprise medical bill for treatment they expected to be covered by insurance," said a spokesperson from the AHA. "This would happen when patients unknowingly received treatment from an out-of-network healthcare provider. Often, this was a result of an emergency situation, putting heart and stroke patients at an even greater risk of receiving financially devastating surprise medical bills."

Ryan Stanton, MD, a physician with Central Emergency Physicians in Lexington, Kentucky, pointed out that there is often misinterpretation among patients as what insurance will and will not cover. "We don't want to put the patient in the middle and we just want to provide the best care," he said. "Out-of-network billing can be a problem, but most of what we're seeing are the results of the [Affordable Care Act], which put no governance on the increasing expansion of copays and deductibles."

Much of what patients are seeing, he continued, is that insurance doesn't cover very much. "So much of the time they don't realize how much they actually have to pay, because of the high copays and deductibles," he said.

Another cause of surprise billing, at least in emergency medicine, is when after the insurer reviews the claim, it is determined that the situation was not an emergency after all. "They decide this after the fact, that you didn't have an emergency and they aren't going to pay the bill," said Stanton. "They expect the patient to know what's causing their symptoms and to know it isn't an emergency."

However, it's important for people to know that hospital bills aren't set in stone. "Every patient has the right to negotiate a bill," he said. "They may not get anywhere with their insurer but they can usually negotiate it with the hospital, who wants to be paid and will often lower the bill."

No More Surprises?

Consumers have new billing protections when getting emergency care, non-emergency care from out-of-network providers at in-network facilities, and air ambulance services from out-of-network providers. The surprise billing provisions of the Consolidated Appropriations Act, 2021 ─ commonly referred to as the No Surprises Act ─ went into effect this past January 1 with the goal of offering consumers more protection. Excessive out-of-pocket costs are restricted, and insurers must continue to cover emergency services without any prior authorization, and regardless of whether or not a provider or facility is in-network.

"The No Surprises Act has one purpose — to take patients out of the middle of payment disputes and protect them from the devastating impact of unexpected medical bills," said the American Heart Association. "The law also prohibits certain out-of-network providers operating within in-network facilities from issuing bills for out-of-network services in non-emergency situations unless they first give patients an estimate of charges 72 hours prior to delivering care and patients provide advance consent to receive that care."

AHA also has "joined others in the patient community calling on the Biden administration to put in place a broad and well-funded consumer education campaign to notify consumers of their new rights under the law."

Roxanne Nelson, RN, BSN is a freelance writer based out of Seattle.

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