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Charges for Hospitalized COVID-19 Patients May Reach Up to $1.4 Trillion

Charges for All Hospitalized COVID-19 Patients May Reach Up to $1.4 Trillion

What You
Should Know:

FAIR Health brief finds the total costs for all hospitalized COVID-19 patients range from a low of $362 billion in charges and $139 billion in estimated allowed amounts to a high of $1.449 trillion in charges and $558 billion in estimated allowed amounts, depending on the incidence rate of the infection in the US population.

The total average charge per COVID-19 patient requiring an inpatient stay is $73,300 and the total average estimated allowed amount per commercially insured patient is $38,221.

The top 10 telehealth codes most often associated with all respiratory infections, with the predominant one in 2019 being CPT 99441 (physician/QHP telephone E&M, 5-10 minutes), which accounted for 50 percent of all telehealth services for respiratory infections.


The total costs for all hospitalized COVID-19
patients may range from a low of $362 billion in charges and $139 billion in
estimated in-network amounts to a high of $1.449 trillion in charges and $558
billion in estimated in-network amounts, depending on the incidence rate and
severity of the infection in the US population, according to newly released FAIR Health brief.

The FAIR Health brief, COVID-19: The Projected Economic Impact of the COVID-19
Pandemic on the US Healthcare System
is based on FAIR Health projections,
derived from estimates issued by public health experts, that from 66 million to
198 million Americans may become infected with the novel coronavirus that
causes COVID-19, and that from 4.9 million to 19.8 million of them may require
inpatient stays. The total average charge per COVID-19 patient requiring an
inpatient stay is estimated at $73,300 and the total average estimated
in-network amount per commercially insured patient at $38,221.

Research Brief Background

The current pandemic of coronavirus disease 2019 (COVID-19)
is exacting heavy economic and social costs around the world. In the United
States, one aspect of the costs of COVID-19 that is of great interest, but
little understood is the potential cost to the nation of inpatient services for
those with the disease. FAIR Health, a  national, independent nonprofit organization
dedicated to bringing transparency to healthcare costs and health insurance
information drew on its database of over 30 billion private healthcare claim
records, and on estimates of Medicare and Medicaid costs, to project US costs
for COVID-19 patients requiring inpatient stays.

Key Findings

FAIR Health estimated the costs of COVID-19 medical care
based on proxy codes used by providers. The following findings were based on
inpatient ICD-10 procedure codes and revenue codes associated with influenza
and pneumonia. Other key findings of the research brief include:

DRG

– On the basis of DRG, the per-patient average costs for hospitalized COVID-19 patients vary depending on severity. The total average charges per patient range from $74,310 for patients with major complication or comorbidity (indicated by DRG code 193), to $42,486 for patients with no complication or comorbidity (indicated by DRG code 195). The total average estimated allowed amounts per commercially insured patient range from $38,755 for DRG 193 to $21,936 for DRG 195.

– Total costs for all hospitalized COVID-19 patients vary on the basis of which DRG code is used. Assuming the highest projected numbers of infected patients needing inpatient stays, the costs range from $1.469 trillion in charges and $575 billion in estimated allowed amounts (for DRG193) to $840 billion in charges and $329 billion in estimated allowed amounts (for DRG 195). (Total estimated allowed amounts include figures for commercially insured, Medicare and Medicaid patients.)

Telehealth

– The telehealth code most often associated with all respiratory infections in 2019 was CPT®6 99441 (physician/qualified healthcare professional telephone evaluation and management [E&M], 7 5-10 minutes), accounting for 50 percent of all such services. The average charge for CPT 99441 is $43 and the average estimated allowed amount is $34 for commercially insured patients, making it the lowest-cost service of CPT codes that are used only for telehealth.

– Four of the top 10 codes most often associated with respiratory infections in 2019 were E&M codes that may be billed both for telehealth and non-telehealth. Among these codes, having telehealth as the place of service in most cases yields cost savings by comparison with all places of service for the same code.

Marty Makary, MD, MPH, a professor of health policy and
management at the Johns Hopkins Bloomberg School of Public Health and a
professor of surgery at the Johns Hopkins University School of Medicine,
commented: “As we as a country mobilize every resource to fight COVID-19,
people want to know how much it will cost. FAIR Health has helped put a price
tag on medical services to care for these patients based on the best available
projections using real-world data.”

For more information, download the FAIR Health brief here.



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