COVID-19 Resource Center

COVID-19 Resource Center

Perspective from Amesh A. Adalja, MD
Disclosures: Tsai and colleagues report no relevant financial disclosures.

June 01, 2021
2 min read
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COVID-19-related care for Medicare beneficiaries cost $6.3B in 2020

Perspective from Amesh A. Adalja, MD
Disclosures: Tsai and colleagues report no relevant financial disclosures.

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The costs of COVID-19-related care that was provided to Medicare fee-for-service beneficiaries between April 2020 and December 2020 totaled $6.3 billion, according to researchers.

“Treatment after COVID-19 diagnosis is not free; payment is shared by patients, insurance payers and health care providers, and the amount for which each stakeholder is responsible depends on the patient’s insurance status and coverage,” Yuping Tsai, PhD, a health economist at the CDC, and colleagues wrote in Annals of Internal Medicine. “Knowledge of the direct medical costs of COVID-19 treatments is limited.”

Mean hospitalization cost of COVID-19-related care for Medicare fee-for-service beneficiaries: $27,752 from April 2020 through December 2020
Data derived from: Tsai Y, et al. Ann Intern Med. 2021;doi:10.7326/M21-1102.

Tsai and colleagues conducted a retrospective observational study using medical claims of 1,181,127 Medicare fee-for-service beneficiaries (57% women; 79.6% non-Hispanic white; 77.2% resided in an urban county) who had a COVID-19-related medical encounter from April 2020 through December 2020.

According to the researchers, 92.6% of the total $6.3 billion costs of COVID-19-related care were for hospitalizations. Overall, patients had a mean hospital stay of 9.2 days and a mean hospitalization cost of $21,752. Among patients who required a ventilator, the mean length of stay was 17.1 days, and the mean hospitalization cost was $49,441. Among patients who died, the mean length of stay was 11.3 days, and the mean hospitalization cost was $32,015. Outpatient visits had a mean cost of $164.

The researchers also wrote that men and patients whose race or ethnicity was not white had a higher likelihood of requiring hospital care and higher costs. Furthermore, patients aged 75 years or older were also more likely to require hospital care but had lower costs vs. younger patients.

“As the pandemic continues, it is critical to continuously promote mitigation behaviors and vaccination among older adults to prevent infection and transmission of the virus,” the researchers wrote. “Identifying effective strategies to promote vaccine uptake is critical, and efforts are particularly needed among non-white persons aged 65 years or older to mitigate the increased disease and economic burden of COVID-19.”

In a related editorial, David Blumenthal, MD, MPP, the president of the Commonwealth Fund, a philanthropic organization that is dedicated to independent research on health and social policy issues, and colleagues noted that the study did not include data from patients who had Medicare Advantage plans or the cost of posthospitalization rehabilitation care among the study population. They also noted that claims data “tend to lag real-world events by at least 3 months.”

“Though limited as a means of tracking unfolding emergencies, claims data and their analysis do serve one very important function that epidemiologic data do not: They can provide useful estimates of the financial benefits of preventing an illness and the corresponding costs of treating it,” Blumenthal and colleagues wrote. “This information allows calculations of the comparative costs and benefits of different approaches to preventing and treating COVID-19 and how these investments compare in value with investments in preventing and treating other illnesses.”

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