With COVID-related lockdowns and pandemic safety precautions now past their first anniversary, there is, at long last, hope on the horizon. Yet, despite the recent rollouts of the vaccines produced by Pfizer and Moderna, new daily COVID cases and deaths continue and a fast-moving mutation is spreading across the globe. Although much is still unknown about the coronavirus, it is becoming increasingly evident that early intervention and treatment are critical for patient outcomes.
However, ensuring widespread access to comprehensive care is easier said than done in the complicated and opaque American healthcare system, in which medical bills frequently reach exorbitant totals. A 2019 Gallup poll showed that 25% of Americans reported delaying treatment for serious medical conditions due to cost concerns—the highest proportion since Gallup first began asking the question in 1991. Even during the pandemic, when medical treatment could mean the difference between life and death, studies show that nearly 1 in 7 Americans would avoid seeking medical care if they experienced key COVID-19 symptoms because of fears associated with the cost of treatment.
These statistics are unsurprising, and the concerns they underscore well-founded: the average treatment costs for COVID patients with symptoms serious enough to require inpatient hospital stays range from $42,486 for relatively mild cases to $74,310 for patients with major complications or comorbidities. But who pays for that care? The answer largely depends on whether and how a given patient is insured.
Before the coronavirus grounded flights, shuttered restaurants and retail stores, and forced the country into lockdown, approximately 27.5 million Americans did not have health insurance of any kind. It is difficult to measure how these numbers have changed as a result of COVID-related economic instability and layoffs, because national surveys producing such estimates often lag by months or even years. However, according to an August Economic Policy Institute estimate, an additional 6 million Americans may have lost their employer-based health coverage since the pandemic began. While at least some of the losses may have been offset by enrollment in Medicaid or healthcare plans offered through the public health insurance exchanges, it is clear that tens of millions of Americans remain uninsured during the worst health crisis this country has faced in over a century.
It is notable that, under the Affordable Care Act (ACA), nearly one in four of those uninsured in a typical year are eligible for financial assistance to buy coverage—in fact, most of those eligible qualify for free or nearly free health insurance plans. For example, in 2018, 11.2 million uninsured people were eligible for health insurance completely free of charge, largely through the public health insurance exchanges developed under the ACA. It is likely that the total number of those eligible for free or low-cost insurance is even higher today, given that the vast majority of people who have lost employer-based coverage as a result of the pandemic would qualify for similarly subsidized ACA plans.
Despite the widespread availability of affordable health coverage, many Americans losing their health insurance may not be aware of their eligibility for financial assistance through the ACA. This is not surprising given that the Trump administration reduced funding for marketing and outreach activities for the federal exchange by nearly 90%. Moreover, those who attempted to sign up for coverage under the ACA might have been precluded from doing so, even if they were aware of their eligibility for free or low-cost insurance, when the administration scheduled periods of maintenance during several open enrollment periods.
With virus cases still occurring and millions of Americans lacking coverage, what options are available to uninsured COVID patients? On April 3, 2020, the Trump administration announced a new treatment reimbursement program under the Coronavirus Aid, Relief, and Economic Security (CARES) Act. The program allows healthcare providers who test and treat uninsured COVID patients to be reimbursed by the federal government at Medicare rates. However, the statute imposes certain limitations. For one, the program makes eligibility for reimbursement contingent upon a primary diagnosis of COVID-19. The challenge is that hospital coding protocols often require patients who are being treated for complications arising from the virus not to be coded with a primary diagnosis of COVID-19. The American Hospital Association has estimated that participating hospitals have not submitted between 40 and 70 percent of uninsured patient claims because COVID-19 was not ruled their primary diagnosis.
Perhaps even more problematically, the program neither requires providers to participate nor guarantees reimbursement for those who do, as reimbursement is contingent on available funding. This leaves healthcare providers in a tough spot. On the one hand, they must encourage sick patients to seek treatment and provide the necessary care, but on the other, they have no way of knowing how much a patient would end up owing in medical bills following their visit.
In practice, this ambiguity means that many providers and hospitals never tell patients that their COVID-related treatment costs may be covered by the federal government. According to Jennifer Tolbert, the Director of State Health Reform at the Kaiser Family Foundation, a nonpartisan research organization, part of the problem is that physicians don’t always know how the program works or that it even exists. But even when lack of information is not an issue, physicians are often reluctant to broach the subject with patients.
While the federal Emergency Medical Treatment and Labor Act (EMTALA) requires emergency rooms to stabilize all patients, regardless of their ability to pay, hospitals may incur penalties if they ask about a patient’s insurance coverage. In fact, such questions are often referred to as “wallet biopsies,” which can result in a hospital being fined and even temporarily banned from receiving Medicare payments. As Dr. Ryan Stanton, a physician in Lexington, KY, and a board member of the American College of Emergency Physicians, makes clear, physicians often “don’t want to absolutely promise anything” to do with cost. According to Dr. Stanton, “[t]here should not be a false sense that it will be an absolute smooth path when . . . dealing with government services and complexities of the health care system.”
Often, patients still recovering from the effects of COVID are left to challenge erroneous bills and negotiate with providers. Take the case of Marilyn Cortez, an uninsured retired cafeteria worker in Houston, TX, as an example. Even though Ms. Cortez’s COVID-19 treatment should have been covered by the CARES Act reimbursement program, the hospital still sent her a $36,000 bill. After discovering their mistake, the hospital informed Ms. Cortez that she need not worry. However, they then sent her another bill for twice the amount. Similarly, Darius Settles became one of Nashville, TN’s youngest COVID fatalities after a local hospital’s failure to disclose the possibility that his medical costs would be covered by the federal government dissuaded him from seeking further treatment due to his uninsured status. Despite the availability of reimbursement funds, the hospital nonetheless sent his widow a bill for a portion of his treatment costs.
These difficulties are by no means limited to the uninsured. Even people with comprehensive health insurance coverage may still find themselves unable to afford rising deductibles or the “surprise” or “balance” bills associated with medical care for treatment of COVID-19 and its accompanying complications. If a bill goes unpaid, healthcare providers often contract with collection agencies or law firms to sue the patient in order to obtain payment. According to a Pew Research Center report, such lawsuits disproportionately target lower income populations and racial minorities, who often lack legal representation; in over 70% of such cases, the suits end in default judgment (where a court rules in favor of the plaintiff because the defendant has failed to respond). These proceedings can further exacerbate the financial strain on patients and their families, as courts frequently require them to pay court fees and accrued interest in addition to the default judgement. What’s worse, even those lucky enough to escape litigation can face additional financial strain in the form of wage garnishment.
The COVID-19 pandemic has shone a light on the underinsurance crisis that has long kept millions of Americans on the precipice of financial disaster—one unexpected illness or injury away from bankruptcy. In the pandemic context, hesitance to seek medical treatment due to fear of the associated cost has frequently proved tragically fatal. Deaths of COVID patients like Darius Settles are especially unconscionable given the availability of federal funding specifically designated to alleviate financial burdens on vulnerable, uninsured populations. While the financial consequences for hospitals unable to collect payment for treatments rendered are severe (the Kaiser Family Foundation estimates that hospital costs for uninsured COVID patients alone could reach between $13.9 billion and $41.8 billion), the brunt of this crisis currently falls disproportionately upon COVID patients and their families, who often have to make the impossible choice between life-saving treatment and financial ruin, with literal questions of life or death hanging in the balance.
However, there are signs of hope. In the words of Dr. Susan Bailey, the president of the American Medical Association (“AMA”), COVID-19 has shown that “universal health coverage is within our reach.” In February 2021, the AMA announced the formation of a new Affordable Coverage Coalition dedicated to eliminating the uninsurance (and underinsurance) crisis in America. This first-of-its-kind initiative relies on the combined efforts of physicians, hospitals, employers, and consumers to advocate for changes to the system that would allow for comprehensive, affordable coverage for all Americans. These efforts have been warmly received by the Biden administration, which recently announced a new health care plan that includes a “Medicare-like” public option, which advocates hope will help transition the country to universal healthcare.