How Vaccines are Covered in the United States
February 13, 2024
The Inflation Reduction Act has helped to close some of the gaps in insurance coverage for vaccines, including some of the newly approved ones.
Several new and novel vaccines were approved in 2023. During the COVID-19 pandemic, vaccine technology made a huge leap forward with the introduction of messenger RNA (mRNA) vaccines. COVID-19 vaccines developed by BioNTech/Pfizer and Moderna use mRNA instead of weakened viruses or virus fragments to teach the body’s immune system how to respond when presented with an infection.
Innovation in the vaccine area continues. In 2023, the FDA approved six vaccines, including several important firsts. But they face a fragmented insurance and policy landscape.
“Different federal policies dictate coverage across different markets and for different populations,” Alessandra Fix, associate principal at Avalere Health, said in an interview.
In the commercial market, the Affordable Care Act requires plans to cover many vaccines without cost-sharing. It also requires coverage without cost sharing in the Medicaid expansion market.
Within Medicare, the Inflation Reduction Act of 2022 (IRA) requires plans to cover vaccines that have been recommended by ACIP with no patient out-of-pocket costs. Prior to the IRA, plans could impose cost-sharing. And as of October 2023, state Medicaid programs have to cover adult vaccines recommended by Center for Disease Control and Prevention’s Advisory Committee on Immunization Practices (ACIP) for nearly all populations. The committee’s recommendations help to guide safe use of vaccines and related biological products.
“ACIP recommendation is the biggest driver of both provider behavior in terms of what vaccines they are recommending to patients and payer coverage,” Fix said.
Last year, the first two vaccines to prevent respiratory syncytial virus (RSV) were approved for older adults with a separate approval for infants of one of them. RSV is a common respiratory virus that usually causes mild, cold-like symptoms, but it can lead to serious respiratory illness and increased hospitalizations.
GSK’s Arexvy, approved for adults in early May 2023. The second adult vaccine was approved a few weeks later. Pfizer’s Abrysvo is a bivalent RSV prefusion F (preF) vaccine that is composed of two preF proteins selected to optimize protection against RSV.
