Medicare Won't Cover Cost of Coronavirus Vaccine

An article published Monday in The Wall Street Journal pointed out that in the likely case that a vaccine candidate is granted Emergency Use Authorization (EUA) by the Food and Drug Administration (FDA), it won't be covered by Medicare. This is because the massive aid program does not cover the costs of products with EUAs.

In March, the Coronavirus Aid, Relief and Economic Security (CARES) Act was passed into law; this guaranteed free-of-charge coronavirus vaccines. But this can only apply to everyone if a vaccine gets standard FDA approval.

As its name suggests, the EUA designation is used as a fast channel for drugs and/or vaccines needed in a crisis situation, such as that presented by the coronavirus pandemic. Due to the typically quick nature of EUA approval, a medicine or vaccine can come to market without the rigorous review standards of a traditional FDA nod.

A syringe being filled with a vaccine from a vial.

Image source: Getty Images.

According to the Journal article, around 44 million people in this country are on Medicare. In 2018, Medicare expenditures consumed 15% of total federal spending.

An unnamed spokeswoman from the government's Department of Health and Human Services said that it is exploring ways for a potential coronavirus vaccine to be covered for patients in need. She added that the vaccine doses purchased by the government will be provided free of charge.

No coronavirus vaccine has yet been approved for widespread use by any major regulator. Several companies, most notably Moderna (NASDAQ: MRNA), are in late-stage trials with their vaccine candidates. There is no guarantee at this point, however, that Moderna or any of its rivals will be successful in such trials and ultimately win approval.

Most coronavirus vaccine developers fell during the bear market on Monday. Moderna, for one, dipped by 0.9% on the day.

10 stocks we like better than Moderna INC
When investing geniuses David and Tom Gardner have a stock tip, it can pay to listen. After all, the newsletter they have run for over a decade, Motley Fool Stock Advisor, has tripled the market.*

David and Tom just revealed what they believe are the ten best stocks for investors to buy right now... and Moderna INC wasn't one of them! That's right -- they think these 10 stocks are even better buys.

See the 10 stocks


*Stock Advisor returns as of August 1, 2020


Eric Volkman has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


More Related Articles

Info icon

This data feed is not available at this time.

Sign up for the TradeTalks newsletter to receive your weekly dose of trading news, trends and education. Delivered Wednesdays.