New COVID vaccine rollout running into insurance, supply roadblocks

The rollout of new COVID-19 vaccines is being obstructed by insurance and supply roadblocks, as customers experience issues with getting insurers to agree on vaccine coverage. The Department of Health and Human Services wrote a letter to insurers stating, "Your obligation as a plan or issuer to ensure that your members have coverage for COVID-19 vaccines without cost sharing is not conditional upon parties' compliance."

Yahoo Finance Health Care Reporter Anjalee Khemlani breaks down the news. For more expert insight and the latest market action, click here to watch this full episode of Yahoo Finance Live.

Video transcript

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SEANA SMITH: It's a new era for COVID-19 vaccines with the drug now being rolled out commercially, but several supply and insurance roadblocks are causing some confusion for people out there and also for pharmacy. Yahoo Finance's Anjalee Khemlani joining us now with those details. Anj, what do we need to know?

ANJALEE KHEMLANI: That's right, Seana. Unfortunately we're hearing reports of individuals getting denials of coverage for their COVID vaccine or running into problems when trying to get insurance coverage. And to that end, the Health Department wrote a letter to insurers on Friday asking them to make sure that these coverage requests and these claims do go through, regardless of whatever is going on internally for-- following the process.

They said, quote, "Whether the problems are directly within your organization's control or the control of your partners, your obligation as a planner or issuer is to ensure that your members have coverage for COVID-19 vaccines without any cost sharing and it's not conditional on other parties' compliance."

So saying that the insurers really do have to take the lead role here in ensuring that the government's promise to ensure free vaccines as the market first turns commercial remains in place. And to help do that, there has been some focus on exactly which covers-- which payers have which rules.

So if you take a look at the private market, for example, vaccines and visits to pharmacies or to places, sites where they do have vaccines are supposed to be covered with no cost sharing. Medicaid and Medicare, of course, Medicare specifically for the Part B, no cost sharing for in-network sites.

And then for the uninsured adults, the Health Department did launch a public-private partnership earlier this year, $1.1 billion invested in ensuring that adults do have access to these vaccines and that they will not incur any cost at the site of the vaccine. Meanwhile, kids also guaranteed.

So it does-- you know, with all of this already in place, they're still running to this issue when the-- as this, you know, industry has come to the first commercial launch of these vaccines, they are running into some hiccups, there seem to be some pain points. We know that, of course, there are only two vaccines on the market right now-- that's Pfizer and Moderna that have gotten the green light for those updated boosters.

And we're still waiting to hear any news from Novavax and their authorization. But even with those two, which, you know, have been on the market through the government program since the beginning of the pandemic or since those first got authorized, we're still seeing this unfortunate hiccup. So it does throw into question what that market is going to look like in total for the booster sort of season. And whether or not they can get over this hiccup and get more doses in arms.

- Yeah. Booster season, but also testing season as well here, Anjalee. When we think about the availability of tests, what does that looking like and are people gravitating towards making sure that they can take advantage of the free tests where available?

ANJALEE KHEMLANI: That's right. Well, you know, the government also launched that reordering of the four tests per address just today. I got mine I hope you guys got yours. Really easy to get at covidtest.gov. Definitely seeing an uptick, of course, in the cases and thus the demand for these tests. And that's sort of why the government has been ensuring that these tests get out, so that there is the access as well.

This is also one of those things where, you know, those rapid at-home tests differ from the PCR tests, which do then get sequenced and sent to labs and subsequently to the CDC. The at-home tests, while they don't follow that process, do at least give some insight, you know, generally of where the increase in cases are.

So it's an important way to sort of keep track as people would share, you know, photos or whatever of their COVID positive tests. So an important way to gain more insight as those free tests and as that push of tests from earlier on that we saw in the pandemic has waned certainly a different point. Though the government has ensured that test should remain covered by insurers.

- All right. Yahoo Finance's own Anjalee Khemlani. Excellent coverage as always. Thanks so much, Anjalee for breaking this down.