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More Than 2 Million Uninsured People May Be Hospitalized for COVID-19

The Trump administration will reimburse hospitals with emergency funding, but there may not be enough money.

First responders from IU Health Bloomington Hospital pick up a woman who described COVID-19 symptoms in Bloomington, Indiana, on March 23, 2020.

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More than 2 million people living without health insurance in the United States may need to be hospitalized and treated for COVID-19, the respiratory disease caused by the novel coronavirus that has sparked a global pandemic and shut down much of the nation, according to a new analysis by the Kaiser Family Foundation.

While researchers caution that there are many uncertainties around how the COVID-19 outbreak will evolve and how many people will ultimately become infected, they estimate that 2 to 7 percent of the uninsured population will require hospitalization and treatment for COVID-19 based on epidemiological models and infection rates. That means between 670,000 and slightly more than 2 million people without health coverage are likely to seek treatment for COVID-19 before the pandemic subsides.

The estimates come on the heels of an alarming report from the Department of Health and Human Services that confirmed what health care workers have been saying for weeks: Hospitals across the country are already overwhelmed by the COVID-19 crisis. As coronavirus spreads, hospitals report facing “substantial challenges” expanding their capacity to treat patients with COVID-19, and widespread shortages of ventilators, personal protection equipment, and other critical supplies are putting both their patients and employees in danger.

The Trump administration has said it will reimburse hospitals for treating uninsured COVID-19 patients, which could cost the government between $13.9 billion and $41.8 billion, according to the Kaiser analysis. While the administration’s plan for reimbursing health care providers is short on specifics, top officials indicated last week that they will tap $100 billion in funding for hospitals provided by the Coronavirus Aid, Relief and Economic Security (CARES) stimulus package recently passed by Congress.

There were nearly 28 million uninsured people nationwide as of December, but that number has likely increased as businesses have laid off or furloughed millions of workers amid the crisis. Untold numbers of Americans have lost their employer-sponsored health coverage or the income necessary for paying premiums to private insurance companies. A study published Tuesday in the Annals of Internal Medicine estimates that 7.3 million workers will lose their employer-sponsored coverage by June, exposing what one author called the “folly of tying health coverage to jobs.”

Some newly unemployed are eligible for Medicaid, the government insurance program for lower-income people, but conservative politicians in 14 states have refused to accept the Affordable Care Act’s (ACA) Medicaid expansion that brings in more people. Other states have trimmed their Medicaid rolls by taking coverage away from people who do not meet onerous work requirements or are simply unable to document their employment and file paperwork on time.

From President Trump on down, Republican politicians who have spent years attacking Medicaid and the ACA find themselves in a political bind as the crisis focuses attention on the deep problems with the U.S.’s complex and hugely expensive health care system. Last week, Trump’s health czar suggested that people who lose their employer-sponsored health coverage apply for Medicaid or take advantage of a special enrollment period for the ACA marketplace, where subsidized private insurance plans are available for those who qualify. Republican governors in red states such as Texas and Mississippi are coming under intense pressure to expand Medicaid after years of dragging their feet.

Eagan Kemp, a health care policy advocate at the watchdog group Public Citizen, said the Kaiser analysis estimates show how far the Trump administration still needs to go to ensure that Americans have the access to the care they need during a crisis.

“This administration has bungled nearly every aspect of the COVID-19 crisis, and so we are dealing with more cases and more deaths than would otherwise have been the case,” Kemp said in an email. “And because their poor response has also meant a steeper, and likely longer, decline for the economy, it means more people will lose their jobs and therefore their insurance.”

Kaiser Family Foundation President Drew Altman said the administration’s plans to cover the cost to hospitals for treating uninsured COVID-19 patients may give uninsured people some “peace of mind.” However, uninsured and underinsured people could still face steep out-of-pocket costs, particularly if they seek treatment at a provider that isn’t covered by the CARES Act, or it turns out that they have a different type of illness, such as the flu.

“While the details are spotty, uninsured patients could still be on the hook if they test negative for coronavirus and if they receive care outside hospitals,” Altman said in a statement.

The three COVID-19 stimulus bills passed by Congress provide emergency funding for hospitals and free coronavirus testing for the uninsured through Medicaid, but lawmakers did not specifically allocate any funding for treating uninsured COVID-19 patients. The legislation includes few details about how the $100 billion for health care providers should be distributed, which the administration had pledged to do quickly, and a number of critical questions remain. For example, will public safety-net hospitals serving economically vulnerable populations get special consideration for funding?

What we know is that both for-profit and nonprofit hospitals can apply for money to pay a range of coronavirus expenses, including medical supplies and the construction of emergency temporary structures to manage overflow. Hospitals cannot use the funding for expenses that they are already receiving a reimbursement for from another payer, such as a private insurance company.

Depending on what share of the U.S. population becomes infected — some estimates put that number between 20 and 60 percent — reimbursing hospitals for the costs of caring for uninsured COVID-19 patients could consume as little as 14 percent or more than 40 percent of the $100 billion special fund from Congress, according to the Kaiser analysis. Given the uncertainty, it remains unclear whether there is enough funding to cover both the uninsured and other critical resources that hospitals need, including medical supplies and temporary facilities.

On Tuesday, Trump used a bureaucratic maneuver to remove the chairman of the federal panel Congress set up to watchdog his administration’s management and distribution of $2 trillion in coronavirus stimulus funding, raising fears that the president is once again resisting independent oversight and surrounding himself with loyalists. On Friday, Trump removed the inspector general for the intelligence community that initially alerted Congress about the whistleblower complaint that lead to Trump’s impeachment in the House last year.

“Donald Trump will stop at nothing to obstruct oversight and install his yes-men in these key positions,” said Senate Finance Committee Ranking Member Ron Wyden (D-Oregon) in a statement Tuesday. “Donald Trump is clearly executing a systematic purge of inspectors general who have done their jobs and refused to bend to political pressures. Every Republican who voted against removing the president paved the way for these authoritarian moves.”

Health care advocates are calling on the Trump administration to automatically enroll all uninsured people in Medicare for the duration of the crisis. Medicare is the subsidized federal insurance system for older Americans that progressives such as presidential hopeful Sen. Bernie Sanders want to expand into a universal, single-payer program known as Medicare for All that would replace private insurance.

“It is hard to imagine a more cruel time to lose access to care and face medical debt and even bankruptcy,” Kemp said. “It is time to enroll everyone losing their jobs, as well as their families, into Medicare for the duration of the crisis to ensure they can get the testing and treatment that they need without going broke.”

The Trump administration has so far resisted calls to expand Medicare and remains steadfastly opposed to Medicare for All. On Monday, the administration announced that it would relax regulations and scale back audits of the Medicare Advantage program that are meant to reduce the “most widespread and nefarious billing abuses,” according to Kemp. The private insurance industry has spent months attacking the audits, which were expected to save taxpayers $4.5 billion over the next decade.

“Protecting the private insurers that threaten the long-term viability of Medicare instead of protecting Americans from paying for fraud is just another example of this administration playing favorites at the expense of the American people,” Kemp said.

Last week, Public Citizen and dozens of other organizations sent a letter to the 10 largest health insurance companies demanding that they waive all out-of-pockets costs for COVID-19 patients, including copays, coinsurance fees and deductibles. A few large insurers, including Cigna and Humana, have already agreed to waive some of the costs for COVID-19 patients that would normally be passed to their customers.

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