Unvaccinated Americans cost the health system $5.7 billion

September 17, 2021, 6:30 PM UTC

A surge in COVID-19 hospitalizations during this summer’s Delta wave has cost the nation’s health care system $5.7 billion in preventable expenses, according to an analysis by the Kaiser Family Foundation.

The amount spent on unvaccinated patients in August hit $3.9 billion, almost twice the figure spent on unvaccinated COVID patients in June and July combined. At least 86% of the 530,000 people hospitalized for COVID during that time were unvaccinated. Each hospitalization was estimated to cost $20,000—a cost to taxpayer-funded public insurance programs and the workers and businesses paying health insurance premiums.

Despite the availability of COVID-19 vaccines, as many as 60 million adults—24% of the U.S. population over age 18—have yet to receive a single dose, including many young people. Some states, including Wyoming, Idaho, and Mississippi, have vaccinated just 40% of their populations, according to New York Times data. Those numbers and the more infectious Delta variant are responsible for a surge in COVID-19 cases, hospitalizations, and deaths.

Last week, President Joe Biden, expressing frustration about the low vaccination numbers, issued an executive order that would expand mandatory vaccination requirements to federal workers, contractors, health care workers and all employers with more than 100 employees. The plan could affect as many as 100 million people, more than two-thirds of the U.S. workforce. Those who receive Medicare or Medicaid would also be subject to the mandate.

“Because it’s so political, this takes the heat off of employers to mandate vaccines,” said David E. Williams, president of Boston-based Health Business Group, a health care consulting firm. He thinks mandates will make a difference in hospitalizations.“Each incremental percentage in vaccination is valuable to the country as a whole.” 

In addition to mandates, the financial risks will grow for people who contract the virus and are hospitalized. While insurers initially waived cost-sharing requirements early in the pandemic for people hospitalized with the virus, patients will pick up more of the tab going forward. At least 72% of the plans among the largest insurers no longer waive these costs, and another 10% of plans will phase out the waivers by the end of October, according to KFF

Most insurers reported record profits last year—because more people put off routine medical visits. But the pandemic has been a disaster for hospitals. While they were well reimbursed for care of COVID patients, hospitals were forced to turn down elective surgeries—such as knee and hip replacements—that are far more profitable and require less space, time, and risk to staff. It led to burnout and resignations among doctors, nurses, and technicians. More than half of U.S. hospitals closed the fourth quarter of 2020 with negative margins, and half a dozen filed for bankruptcy. “They had a lot of customers,” Williams said, “but the wrong kind.” 

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