COVID-19 Vaccines on the Commercial Market: Costs, Access Considerations

With the depletion of federal pandemic funding and the public health emergency (PHE) set to expire in May 2023, experts anticipate Americans will face new challenges related to accessing and paying for COVID-19 vaccines such as Moderna’s mRNA vaccine, Spikevax.

From the pandemic’s onset in early 2020 through March 2022, the US government dedicated at least $2.3 billion to the development of mRNA vaccines and another $29.2 billion to purchase billions of vaccine doses.¹ In the latter half of 2022, the current administration asked for an additional $22.4 billion from Congress to continue funding COVID-19 research and vaccine supply, but Congress has yet to approve the request. Without more funding, the federal government will be unable to purchase additional vaccine doses, said the White House in a press release.²

Spikevax, also known as the Moderna COVID-19 vaccine, is a monovalent mRNA vaccine administered in a 2-dose primary series. More than 250 million doses of Moderna’s original vaccine and nearly 20 million booster shots have been administered in the United States.³

Between August 2020 and July 2022, the federal government spent nearly $10 billion on bulk purchases of Spikevax and Moderna’s updated booster. Once Spikevax hits the commercial market, each dose is expected to be priced between $82 and $130.⁴

“If payers end up paying those prices for 1 dose per adult…the total cost of purchasing booster shots commercially would run between $6.2 billion and $29.7 billion a year, depending on price and how many people nationally get the vaccine or booster,” a Kaiser Family Foundation (KFF) analysis suggests.⁵

Additionally, the PHE, which currently requires health plans to cover COVID-19 vaccines without cost-sharing, is set to expire May 11, 2023. 

COVID-19 vaccines will continue to be available without cost-sharing for Medicare, Medicaid, and Children’s Health Insurance Program (CHIP) beneficiaries. Spikevax will be covered under Part B, and Medicare plans will determine a payment rate and reimburse providers for the vaccine and administration costs.⁶

Likewise, Medicaid and CHIP health plans are required to cover all vaccines recommended for adults by the Advisory Committee on Immunization Practices. States will reimburse providers for vaccines and administration, except in cases where vaccine doses are eligible for funding under the Vaccines for Children program, in which case states will only reimburse for administration costs.⁶

Those enrolled in private insurance may face new out-of-pocket costs, but it is more likely that premiums will increase as health plans adjust to the new per-dose prices, according to KFF. Private health plans also will no longer be required to reimburse out-of-network providers for administering Spikevax and other COVID-19 vaccines.⁶

Uninsured and underinsured individuals are particularly vulnerable to cost and access barriers. The PHE created a new eligibility pathway under Medicaid and CHIP through which COVID-19 testing, treatment, and vaccines were covered for uninsured individuals, but when the PHE expires, uninsured Americans “will have limited access to free vaccines, and no coverage for the cost of treatments and tests,” said authors in a recent KFF brief.⁶

“For private insurers and their enrollees, these costs could push premiums upward. People who are uninsured would lose guaranteed access to free COVID-19 vaccines, and the high cost of getting one at the commercial price could discourage some from getting them,” said the authors.

Despite these challenges, vaccination is still likely to be a cost-effective strategy. In 2020, COVID-19 hospitalizations cost an average $41,611, and real-world data show Spikevax is 93% effective reducing hospitalizations.⁷ Additionally, Spikevax’s effectiveness does not wane significantly over time, at 93% after a median 66 days after the second dose and 92% at a median 141 days (P = 1.000), according to the Centers for Disease Control and Prevention.⁸

The estimated commercial costs of Spikevax and other COVID-19 vaccines are subject to change moving forward as new vaccine formulations are developed, the number of Americans opting to receive boosters fluctuates, and the market landscape continues to evolve.

References:

1. Lalani HS, Nagar S, Sarpatwari A, et al. US public investment in development of mRNA COVID-19 vaccines: retrospective cohort study. BMJ. 2023;380:e073747. doi:10.1136/bmj-2022-073747
2. Young S. Meeting critical needs for the American people in the new fiscal year. News release. The White House; September 2, 2022. Accessed March 14, 2023. https://www.whitehouse.gov/omb/briefing-room/2022/09/02/meeting-critical-needs-for-the-american-people-in-the-new-fiscal-year/
3. Centers for Disease Control and Prevention. COVID Data Tracker. US Department of Health and Human Services, Centers for Disease Control and Prevention. Updated March 13, 2023. Accessed March 14, 2023. https://covid.cdc.gov/covid-data-tracker
4. Kates J, Cox C, Michaud J. How much could COVID-19 vaccines cost the US after commercialization? Kaiser Family Foundation. Updated March 10, 2023. Accessed March 14, 2023. https://www.kff.org/coronavirus-covid-19/issue-brief/how-much-could-covid-19-vaccines-cost-the-u-s-after-commercialization
5. COVID-19 vaccines could cost billions of dollars more each year if the federal government ends its bulk purchasing program. News release. Kaiser Family Foundation; December 7, 2022. Accessed March 14, 2023. https://www.kff.org/coronavirus-covid-19/press-release/covid-19-vaccines-could-cost-billions-of-dollars-more-each-year-if-the-federal-government-ends-its-bulk-purchasing-program
6. Cubanski J, Kates J, Tolbert J, Guth M, Pollitz K, Freed M. What happens when COVID-19 emergency declarations end? Implications for coverage, costs, and access. Kaiser Family Foundation. Updated January 31, 2023. Accessed March 14, 2023. https://www.kff.org/coronavirus-covid-19/issue-brief/what-happens-when-covid-19-emergency-declarations-end-implications-for-coverage-costs-and-access/
7. Wager E, Claxton G, Amin K, Cox C. Cost of COVID-19 hospital admissions among people with private health coverage. Peterson-KFF Health System Tracker. November 14, 2022. Accessed March 14, 2023. https://www.healthsystemtracker.org/brief/cost-of-covid-19-hospital-admissions-among-people-with-private-health-coverage/
8. Self WH, Tenforde MW, Rhoads JP, et al. Comparative effectiveness of Moderna, Pfizer-BioNTech, and Janssen (Johnson & Johnson) vaccines in preventing COVID-19 hospitalizations among adults without immunocompromising conditions — United States, March–August 2021. MMWR Morb Mortal Wkly Rep. 2021;70(38);1337–1343. doi:10.15585/mmwr.mm7038e1