Mike Ambrose found his Medicare coverage for the shingles vaccine was so skimpy, he couldn’t afford the nearly $200 shot.
This winter, after Ambrose suffered through three painful weeks with the illness, he learned that his Medicare health plan covered a much bigger tab — about $1,500 in treatment costs.
“You don’t bat an eye paying … for treatment when you could prevent this in the first place?” asked Ambrose, 75, of Savage. “It just doesn’t compute.”
Cost has long been cited as a barrier to some Medicare beneficiaries receiving the shingles vaccine, but the problem is drawing fresh attention as awareness of the vaccine grows and wrinkles emerge with insurance coverage.
Shingles, a viral infection that causes a painful rash that can last for weeks, affects about 1 out of 3 people in the U.S. with an estimated 1 million cases per year, a number that is growing as baby boomers age.
“The increasing number of people who are older clearly is a major driver of the increasing number of cases of shingles,” said Dr. William Schaffner, an infectious disease specialist at Vanderbilt University School of Medicine. “The absolute number of shingles cases is increasing, as well as the rate.”
Rules in the federal Affordable Care Act mean that many people age 60 to 64 with commercial health insurance can receive the shingles vaccine without paying anything out-of-pocket.
Part D exceptions
But the health law regulations don’t apply to Medicare prescription drug plans — called “Part D” plans, for short. So, while all Medicare drug plans cover the vaccine, some beneficiaries like Ambrose might have to first satisfy a deductible or make a sizable co-payment.
Seniors can obtain the vaccine at a pharmacy or their doctor’s office, but not all physicians can bill a Part D plan directly. So, some seniors who get vaccinated at the clinic must navigate a complicated process of getting reimbursed that can leave them with unexpected costs.
The cost and complexity stem from a distinction that’s likely lost on many Medicare beneficiaries. The shingles vaccine is a Part D benefit, where medications commonly are subject to co-payments or deductibles. But older vaccines, like those for flu and pneumonia, are covered under Medicare Part B where there’s no cost-sharing, said Leigh Purvis, director of health services research for AARP, the lobby for seniors.
“With the way that Medicare Part D plans are covering it, we are hearing about people who are, unfortunately, being required to pay a really high level of cost-sharing,” Purvis said. “It’s been a concern for quite a while.”
Shingles is caused by the virus that initially causes chickenpox and then stays dormant in the body for years and even decades. In a minority of cases, shingles can cause more serious side effects ranging from serious complications involving the eye to months or even years of severe pain.
Some people with mild cases of shingles don’t even seek medical treatment. But a federal report that looked at health care spending on the condition between 2003 and 2005 found that treatment costs typically run about $525 per person, for total spending at the time of about $566 million per year.
The New Jersey-based drug company Merck obtained approval in 2006 for the vaccine, which generated $749 million in sales last year. The company has helped boost awareness of the disease and its vaccine, including ads featuring former Pittsburgh Steelers quarterback Terry Bradshaw.
Kantar Media, a firm that tracks spending on advertising, estimates about $85 million was spent on shingles vaccine ads between 2013 and 2015.
“There’s been a lot of promotion about it, so more people are thinking about it,” said Dr. Larry Richmond, a primary care physician with Park Nicollet in Plymouth.
The Cleveland Clinic has a cost-effectiveness study underway, but it’s not yet complete, said Dr. Michael Rabovsky, chairman of the Cleveland Clinic’s family medicine department. Most patients want the shot to avoid the pain and suffering they’ve seen others experience with shingles.
“Many of my Medicare-age patients won’t get [the vaccine],” Rabovsky added, “because of the cost.”
Insurers that sell Part D plans, however, argue that they are helping many seniors get the vaccine, adding that out-of-pocket costs are part of the balance they try to strike between premiums and deductibles.
Kentucky-based Humana says most people in the company’s Part D plans face co-payments ranging from $45 to $66 for the vaccine. Costs can be higher, the company acknowledged, for people who have not met their deductible.
“We continuously evaluate vaccine pricing within our pharmacy benefit strategy to achieve high vaccination rates and maintain the lowest possible premium so that people can afford our plans,” Humana said in a prepared response to questions.
In Minnesota and across the country, more Medicare health plans this year include deductibles, which can run as much as $360 per year.
While some patients must share costs under Part D plans, coverage overall is far better than before Medicare prescription drug plans were launched about 10 years ago, said Dr. James Hartert, vice president and senior medical director with Minnetonka-based Medica. The coverage generally helps prevent future medical costs, Hartert said, adding that some Medicare beneficiaries struggling with the shingles vaccine cost might not have a prescription plan.
For its part, Merck stresses the breadth of insurance coverage for its shingles vaccine, even as consumer advocates say they’ve seen too many people find holes.
Purvis of AARP cited a 2011 report from the federal Government Accountability Office that found cost-sharing and challenges obtaining reimbursement were deterrents to Medicare beneficiaries’ obtaining the shingles vaccine.
“There are a lot of moving parts to exactly how much you’re paying for this vaccine,” she said. “When you’re talking about a population that’s living on a fixed low income, it’s an incredibly large amount of money.”
The issue is surfacing again now, Purvis said, because more people are seeing the difference between cost-sharing in Medicare plans and the richer coverage in many commercial policies that’s mandated by the federal health law.
In a letter to health insurers in February, the federal Centers for Medicare and Medicaid Services asked insurers with Part D plan to consider creating a special tier for vaccines with low or no co-payments in their “formularies” of covered drugs.
“I think they’ve noted that there is this discrepancy in the treatment of vaccine coverage,” said Juliette Cubanski, associate director for Medicare policy at the Kaiser Family Foundation.