LANSING, Mich. — The cost of COVID care in Michigan is about to go up as health insurance companies reinstate deductibles and copays that have been suspended since the beginning of the pandemic.
“Earlier in the pandemic, in 2020, what we’re finding is that the vast majority of people who might have gotten hospitalized with COVID may not have had to pay out of pocket deductibles or copays because insurers and employers were voluntarily waiving out-of-pocket cost sharing for treatment," said Krutika Amin, associate director of the Program on the ACA for the Kaiser Family Foundation.
Amin explained that, because vaccines are readily available and there are viable treatments for COVID-19, the waivers that suspended copays and deductibles are going away.
"As vaccines that are safe and effective and available at no cost to people have become widely available, insurers have been phasing out the cost-sharing waivers," she said.
Michiganders will feel this change a little more because insurers in the state took on extra financial responsibility, according to the Department of Insurance and Financial Services.
“During the pandemic, DIFS was able to get agreements from the vast majority of Michigan insurers to waive these out-of-pocket costs for COVID testing and treatment," said Anita Fox, the director of department. "Our insurers agreed to go a step beyond and waive costs for treatment so that Michiganders wouldn’t have to worry about how they would pay for life-saving treatment.”
Intensive COVID care is massively expensive. There's round-the-clock care, the use of ventilators and treatments for complications, among other things. But experts say, with vaccines, much of that intensive care can be avoided. In fact, Amin says preventable COVID-19 hospitalization in June and July of 2021 alone cost the US healthcare system more than $2 billion.
“Since COVID first began Blue Cross Blue Shield of Michigan has spent about $1.5 billion just in COVID treatment alone," said Dr. James Grant, the chief medical officer of Blue Cross Blue Shield of Michigan.
In just this year, Health Alliance Plan has spent "about $90 million on COVID related care," said Charles Bloom, the company's chief medical officer.
Eliminating the copay and the deductible waivers could cost Michiganders a lot of money depending on their health plans, but insurance companies argue that it's time to start treating COVID like other health issues.
“We’re making it like every other disease. When you get a cold, you pay your copay or deductible when you see your primary care doctor, a specialist, if you have surgery. We all have co-pays and deductibles and COVID is just being brought under the same umbrella as all other diseases," Grant said.
The two companies say now is the time to end these waivers, even as the state is seeing a resurgence of COVID-19 driven by the Delta variant, because there are effective vaccines available.
Additionally, Fox said, vaccination significantly lowers the risk of pricey medical care because it prevents serious illness. In fact, she said, the chances of a fully vaccinated person needing acute care is about 1 in 20,000.
Both Grant and Bloom say that, at the beginning of the pandemic, it was important to waive copays and deductibles because it was unclear just what we were up against.
“We did the waiver initially in March because there was so much unknown. We didn’t really know what the illness would or wouldn’t do," Bloom said.
Things like COVID-19 testing, diagnosis, as well as copays, and deductibles were covered, now that coverage will change.
“Testing, vaccination, and care related to diagnosis of COVID are all still covered without cost-share," Bloom said.
“And it’s not that we’re not continuing to pay for COVID treatment but...we’re just treating it pretty much like any other illness that one gets," Grant said.
Many Michigan health insurers including Blue Cross Blue Shield and Health Alliance Plan will end their waivers at the end of September.