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Medicare and Medicaid to Cover COVID-19 Vaccine, Even if Given Emergency Use Authorization

Published November 2, 2020

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A White House policy officially announced on October 28 put to rest any lingering questions about how or if a COVID-19 vaccine would be covered by Medicare. 

The new ruling from the Centers for Medicare & Medicaid Services (CMS) states that any coronavirus (COVID-19) vaccine that receives authorization from the Food and Drug Administration (FDA) will be covered by Medicare and Medicaid at no cost to beneficiaries as a preventive vaccine, even if that FDA authorization is only for emergency use. 

Trump Administration ruling confirms free COVID-19 vaccines for Medicare beneficiaries

The latest ruling addresses an unintended loophole that resulted from previous coronavirus vaccine policy.

In March, Congress passed the CARES Act, which stipulated that all COVID-19 vaccines will be covered free of charge for Medicare beneficiaries. However, Medicare had existing rules that prohibited coverage of vaccines authorized for emergency use by the FDA, and the urgency of the COVID-19 vaccine suggested a need to designate the emergency use authorization. 

Vaccines that receive the emergency use designation by the FDA are allowed to bypass many of the clinical trials and other research stages in order to expedite delivery. Thus, Medicare traditionally does not cover such vaccines. 

But the Trump Administration’s new ruling provides clarification and states that both Medicare and Medicaid will cover the vaccine even if given an emergency use authorization. 

How will the COVID-19 vaccine be distributed?

The vaccine will be given to health care providers to administer to patients at no cost. Medicare will then reimburse the providers for the cost of injecting the vaccine. If two doses are required, Medicare will pay even more for the second dose. 

The latest ruling also puts in place some provisions of the CARES Act that call for private insurers and state Medicaid agencies to cover a vaccine under most health care plans with no cost-sharing between the provider and the patient during the course of the public health emergency. 

Those who are uninsured can still receive the vaccine at no cost, and providers will be reimbursed by the Provider Relief Fund. 

Earlier in October, the CMS reached an agreement with CVS and Walgreens to help distribute a vaccine to long-term care facilities such as nursing homes. 

A handful of COVID-19 vaccines are now in final stage trials, with early 2021 as the earliest date that a vaccine may be approved and granted an emergency use authorization.