MA Reimburses 2X Medicare Rate for Some COVID-19 Vaccinations

Healthcare providers in Massachusetts are getting twice the standard Medicare rate for COVID-19 vaccinations in an effort to accelerate vaccine rollout, according to a recent provider bulletin from the state’s Medicaid office.

The provider bulletin released in January 2020 states that providers administering the two-dose vaccines from Pfizer and Cambridge, Massachusetts-based Moderna will receive $33.88 for the administration of the first dose and $56.78 for the second dose.

Those rates are about double the payment allowances Medicare set providers—$16.40 for the first dose and $28.39 for the second dose.

The latest provider bulletin in Massachusetts did not include new reimbursement rates for the single-dose COVID-19 vaccine from Janssen, a Johnson & Johnson Company, which was authorized for emergency use in the US late last month.

The Massachusetts Medicaid office had previously set provider reimbursement rates for COVID-19 vaccination at the lower Medicare payment allowances. But Governor Charlie Baker has agreed to increase the rates to improve vaccine rollout across the state, reported The Boston Globe, which first broke the story on Mar. 8.

“The Commonwealth is engaged in the biggest vaccination effort in recent history, and the administration is taking immediate and bold steps to prepare Massachusetts to vaccinate as many residents as possible in the most efficient and equitable manner,” Brooke Karanovich, a spokeswoman for the Executive Office of Health and Human Services, told the Globe.

“Reimbursement rates to providers should not be a barrier,” Karanovich added.

The “little-noticed decision,” reports the Globe, shocked even hospitals that did not expect to receive a higher reimbursement rate for vaccine administration despite asking for a boost earlier this year.

COVID-19 vaccination has been a costly effort for healthcare providers, who have shouldered the burden of identifying eligible patients, creating or fostering community-based vaccination sites, and getting shots into the arms of individuals.

Physicians have put out a national call for fair COVID-19 vaccination reimbursement.

“A vaccine can only be as effective as our ability to turn them into actual vaccinations given to our patients and the public,” Jacqueline W. Fincher, MD, MACP, president of the American College of Physicians recently said.  

“A coordinated effort is critical to distributing the COVID-19 vaccine to the public and will require communication, collaboration and information sharing among physicians and other vaccinators.”

But Governor Baker’s move also surprised private payers in the state, which are subject to the higher reimbursement rates for the COVID-19 vaccines, leading some to wonder if the higher rates will increase future healthcare costs, such as member premiums.

COVID-19 vaccines are provided at no cost to patients, meaning typical cost-sharing requirements are waived and payers must cover the service and pay providers. But these reimbursements could increase healthcare costs for payers, leading to increases in premiums down the line.

Governor Baker used executive powers applicable during the public health emergency to apply the new state Medicaid reimbursement rates to private payers in the state.

Most state Medicaid programs are reimbursing providers at the Medicare rate of about $45, Matt Salo, executive director of the National Association of Medicaid Directors told the Globe. While some states do pay their providers more, Massachusetts seems to be the only state to double the Medicare rates for COVID-19 vaccinations.

Hospitals in Massachusetts had halted COVID-19 vaccination efforts after struggling to acquire doses from the state government earlier this year. The state has since restored hospital supplies, enabling providers to resume vaccination efforts alongside government-sponsored initiatives.