How The Government Could Make Coronavirus Treatment Affordable

There’s a serious risk that Americans who become infected with coronavirus, or COVID-19, may be unable to afford potentially high medical costs, according to health leaders and Democrats. The good news is there are things the federal government can do to help. The question is whether President Donald Trump and his administration will actually do them.

Major emergencies, from natural disasters to infectious disease outbreaks, are incredibly common, so the government has a number of tools at its disposal it can utilize to help those affected. Those range from cash assistance to temporary housing to help with medical needs. None of these things would come close to fixing America’s frayed safety net, but they could provide targeted help to people in the midst of a crisis. 

According to the most recent census data, 8.5% of Americans, or 27.5 million people, were uninsured in 2018. And 194 million people, or 45%, are “underinsured,” the findings of a 2019 Commonwealth Fund analysis show. 

Lawmakers are already taking action. On Wednesday, congressional leaders announced a bipartisan, $8.3 billion spending package to address coronavirus, including $300 million to purchase vaccines for coronavirus, although it will be at least a year or two before inoculations are expected to become available. And while it’s normally Democrats who advocate for government assistance to people in need, this time a number of congressional Republicans appear open to the administration providing direct help with coronavirus patients’ medical costs.

In the meantime, the Trump administration could take several significant steps, if it so chose, to protect Americans ― especially those who are uninsured or underinsured ― from bearing crushing costs as a result of exposure to coronavirus. 

The departments of Health and Human Services, Defense and Veterans Affairs jointly operate the National Disaster Medical System, which has existed since 1984 to offer direct medical care and financial assistance during public emergencies. 

When invoked by the president, the program enables the government to call up a nationwide reserve of medical professionals who travel to areas in need and treat patients. In addition, patients can seek care at Defense and Veterans Affairs medical facilities at no cost. And private hospitals can voluntarily participate and be reimbursed for their costs at 110% of what Medicare pays for the treatments provided. 

This help for patients, however, is temporary and funding is limited. Moreover, the federal government rarely uses its authority to cover care at private hospitals, although the George W. Bush administration did use the program in the aftermath of Hurricane Katrina in 2005, according to the Congressional Research Service, a nonpartisan arm of Congress.

Robert Kadlec, assistant secretary for preparedness and response at the Department of Health and Human Services, told a Senate committee on Tuesday that the administration is looking into activating this program. Later that day, Trump alluded to the same option during an appearance at the National Institutes of Health.

During emergencies, the federal government can temporarily make it easier for affected people to sign up for Medicaid, the joint federal-state program for low-income people. At the request of states, federal authorities can waive normal Medicaid rules related to applications and eligibility to help connect people harmed during a crisis to medical care, explains a 2018 report from the Medicaid and Children’s Health Insurance Program Advisory Commission, an expert panel that advises Congress.

In some cases, such as in Louisiana and Mississippi after Katrina hit the Gulf Coast 15 years ago, that can include things as simple as automatically approving Medicaid applications, even if people lose benefits later if it turns out they didn’t qualify. New York implemented similar measures after the 9/11 terrorist attacks. 

In Flint, Michigan, the Barack Obama administration used Medicaid rule waivers in the midst of the lead contamination of the local drinking water supply in 2016. At Michigan’s request, the federal government allowed the state to raise the income eligibility standard for pregnant women and children to enable them to receive Medicaid coverage and to permit higher-income individuals to buy into Medicaid.

The nation’s leading public health agency has the authority to use its own funds to cover the costs of diagnosing and treating illnesses during an emergency. To date, the agency has not formally activated this authority, although the CDC is handling treatment for some coronavirus patients. This assistance is limited, however, to the care the CDC directly provides and does not cover costs incurred at hospitals and other medical facilities after a patient is released from the CDC’s care.

New York state is the first jurisdiction to declare that health insurance companies must provide testing and treatment for coronavirus without asking for payment from patients, meaning normal forms of cost-sharing like deductibles and copayments won’t apply. Other states could take similar action, but this comes with a severe limitation: States don’t have regulatory authority over job-based health insurance, which is the most common form of health coverage in the United States and is federally regulated.

If a vaccine for coronavirus ever becomes available, however, the 2010 Affordable Care Act includes a key provision that could make it affordable for people with most types of private health insurance policies or coverage from government programs.

Under the law, insurance companies may not require cost-sharing for preventive medicine, which includes things like contraception, screening for sexually transmitted infections and routine immunizations.

The items covered under this part of the law must be approved by four expert committees affiliated with the Department of Health and Human Services. Those committees would have to agree that a coronavirus vaccine constituted preventive care, and that would make cost-sharing disappear. This would not, however, apply to treatments, only to vaccinations.

The administration already has used another part of the Affordable Care Act to address coronavirus by designating tests for the disease as “essential health benefits” that private insurers and government programs must cover, although that move doesn’t do anything to mitigate patient cost-sharing. Trump also currently is asking the Supreme Court to invalidate the entire law.