US plans to stop buying Covid shots in fall What that means

A pharmacist delivers a COVID-19 booster dose at a CVS store in Chicago in October.

Antonio Perez | Tribune News Service | Getty Images

The U.S. will stop buying Covid vaccines at discounted prices nationwide and will shift vaccine distribution to the private market as early as early fall, shifting the cost to U.S. insurers and uninsured Americans who will have access to the free vaccines could lose.

dr Ashish Jha, the White House Covid response coordinator, said in an interview with the UCSF Department of Medicine on Thursday that the move to a private market will occur in the summer or early fall, although no specific date has been set.

A senior official with the Department of Health and Human Services told CNBC the fall is a natural time to move to a private market, especially when the Food and Drug Administration selects a new Covid strain for the vaccines and asks manufacturers to provide updated shots to create in advance the respiratory virus season.

For the past two years, the US has bought vaccines directly from Pfizer And Modern at an average price of about $21 per dose, according to the Kaiser Family Foundation.

The federal government has obliged pharmacies, medical practices and hospitals to make these vaccinations available free of charge to everyone regardless of insurance status.

If you have health insurance

When the federal Covid immunization program ends, shots will remain free for people who have health insurance due to Affordable Care Act requirements.

But uninsured adults may have to pay for their vaccinations, if Pfizer And Modern Start selling the shots in the private market and the current federal supply will run out. There is a federal program to provide free vaccines to children whose families or caregivers cannot afford the vaccines.

Jha said Tuesday the proposed move was not tied to the end of the Covid public health emergency in May.

“The end of PHE does NOT mean people will suddenly be unable to get the vaccines and treatments they need,” Jha wrote in a Twitter thread on Tuesday.

When the federal government stops buying vaccines at a nationwide discount, individual health care providers will buy the syringes from the vaccine manufacturers at a higher price.

Moderna CEO Stephane Bancel told CNBC last month that the company is preparing to start selling the vaccines in the private market as early as this fall. Albert Bourla, Pfizer CEO, told investors during this week’s earnings call that he was preparing for the vaccines to hit the market in the second half of the year.

Pfizer and Moderna have said they are considering raising the price of the vaccines to around $110 to $130 per dose once the US government exits the vaccine program.

If you are not insured

“If you don’t have insurance, you may have to face the full cost,” said Cynthia Cox, Affordable Care Act expert at the Kaiser Family Foundation.

But the US still has a sizeable supply of free vaccines left. The Biden administration ordered 171 million Omicron boosters last year. About 51 million booster shots have been given to date, according to the Centers for Disease Control and Prevention.

The uninsured will continue to have access to those 120 million doses for free, but it’s unclear how long the supply will last.

“With the supply that we have of vaccines and antivirals, we don’t think we will be in a state of precipitous transition to drop this onto market partners,” the HHS official said.

Although vaccine makers are preparing to sell shots in the private market later this year, it’s possible the federal stockpile of free shots could last longer because uptake of booster shots has been low, Cox said.

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“Anyone in the United States, regardless of citizenship status or insurance status, can get a free vaccine while this federal supply lasts,” Cox said.

Sen. Bernie Sanders, I-Vt., slammed the vaccine price hike in a letter to Moderna’s CEO last month. Sanders, chair of the Senate Health Committee, said the rate hike would cost taxpayers billions because it impacts Medicaid and Medicare budgets.

“Perhaps most importantly, quadrupling prices will make the vaccine inaccessible to millions of uninsured and underinsured Americans who cannot afford it,” Sanders said. “How many of these Americans will die from Covid-19 because of limited access to these life-saving vaccines?”

Jha said this week that the Biden administration is committed to helping the uninsured access Covid shots and treatments.

“We are creating a whole series of separate efforts for the uninsured because, of course, by definition, the uninsured cannot get free vaccines and treatments under the regular insurance system,” Jha said Thursday. “We’re working on a plan for that.”

The HHS official said one tool the federal government plans to use is a program called Section 317, which provides funds for free procurement and administration of vaccines to uninsured adults.

ACA Requirements

But for the overwhelming majority of people with private insurance, the Affordable Care Act will cover the cost of the vaccines. Under the ACA, private health insurance is required to cover all CDC-recommended vaccinations at no cost to the consumer.

Medicare would cover the vaccinations for seniors who are most vulnerable to the virus, and those on lower incomes could get the vaccine through Medicaid.

There may be a small number of older, pre-ACA private health insurance plans that don’t need to cover Covid vaccines, Cox said. The HHS official said most of those plans would likely pay for the recordings.

Additionally, some short-term insurance policies might not pay for the vaccines, Cox said. These plans were expanded during the Trump administration and do not have to comply with the ACA.

The ACA also allows private insurance companies to limit vaccine coverage to providers on the network, Cox said. People who have become accustomed to getting vaccinated at any pharmacy during the pandemic may need to go to a specific drugstore to get a free shot in the future, she said.

Consumers could also see their health insurance premiums rise if Pfizer and Moderna raise the price of shots, Cox said.

Paxlovid may not be free

Depending on their insurance policy, some patients will probably also have to pay for Pfizer’s antiviral pill Paxlovid in the future. Unlike preventative services like vaccinations, the ACA does not require insurance to cover treatments.

Bourla told market analysts this week that Pfizer expects to start selling Paxlovid through the private market at commercial prices in the second half of 2023.

Pfizer hasn’t disclosed how much the antiviral will cost once it goes on sale. The federal government pays about $530 for a five-day treatment course. It’s unclear how much patients will have to pay out of pocket and how much of the price insurance will cover.

Dawn O’Connell, who heads the US federal agency responsible for stockpiling, said last August that the Department of Health and Human Services expects Paxlovid to be phased out by mid-2023.

Jha said Tuesday there are still millions of doses of Paxlovid and Omicron boosters in US supplies. “They will continue to be freely available to all Americans who need them,” Jha said of the remaining federal stockpile.