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Costs, reimbursement of childhood vaccines appear to vary across private practices; high costs may prompt financial strain for providers

Wednesday, December 10 2008 | Comments

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What's This? Private physician practices pay a wide range of prices for the same pediatric immunization products and are reimbursed at different levels, according to one recent study. A second study revealed high vaccine costs and unsatisfactory reimbursement levels may prompt financial burden for some providers.

In the first study, researchers from the University of Michigan led by Dr. Gary Freed surveyed a convenience sample of 76 practices in 5 states (California, Georgia, Michigan, New York, and Texas) from April through December in 2007 to collect data on actual purchase prices for childhood immunizations and reimbursements received from the providers' 3 most common, non-Medicaid payers. Most of the practices were in metropolitan statistical areas and had >=3 practicing physicians.

The results showed a considerable difference between the maximum and minimum prices paid by the practices. The difference between the maximum and minimum price per dose was $4.20 for GlaxoSmithKline Plc's pertussis vaccine, Boostrix (tetanus toxoid, reduced diphtheria toxoid and acellular pertussis vaccine, adsorbed). For Merck & Co. Inc.'s combination vaccine Proquad (measles, mumps, rubella and varicella), the difference was $31.84.

The public sector prices were higher for most practices, the study data also found.

Similarly, there was a wide range of reimbursements across the practices. For Proquad, the difference between the minimum and maximum payment per dose was largest ($84.06). The difference was smallest for Sanofi Pasteur's Tripedia (diphtheria and tetanus toxoids and acellular pertussis vaccine, adsorbed). Mean reimbursements for all the vaccines were at or above the average wholesale price, the researchers noted.

Approximately 1 in 4 of the respondents claimed they had either terminated business with a payer because of its reimbursement level or stopped administering vaccines to patients in a certain plan because of the reimbursement levels offered in that plan.

The researchers concluded that vaccine financing is complex, but the variation in pricing and reimbursement may be out of the practice's control. They called for attention at the national level.

"At the practice level, this variation underscores the need for practices to be cognizant of their own costs and reimbursements for vaccines and to actively seek opportunities to lower their expenditures and to increase their reimbursements," the investigators said. "On a broader level, these data should help inform the continuing discussions by immunization policymakers and other stakeholders to address vaccine financing concerns." (Pediatrics 2008;122:1319-1324.)

In the second study, researchers from the University of Michigan led again by Dr. Freed explored perspectives of primary care physicians regarding reimbursements.

In total, 1,280 U.S. pediatricians and family physicians completed a mailed survey from July through September in 2007. Seventy percent of the pediatricians and 60% of the family physicians responded.

Forty-nine percent of the physicians claimed that their practice had delayed the purchase of specific vaccines for cost reasons during the past 3 years. Another 53% said they experienced decreased profit margin as a result of providing pediatric immunizations during the past 3 years. Twenty-one percent noted it was a "significant" decrease in profit margin (>20%).

Regarding reimbursement levels, 23% reported that they strongly agree or agree that payment levels for vaccine purchase were adequate, while 25% strongly agreed or agreed that levels for vaccine administration were adequate. Sixty-five percent of the respondents said they would not administer a vaccine if the reimbursement price was lower than the purchase price.

Overall, only 11% of the physicians claimed that their practice seriously considered or discussed whether to stop providing all vaccines to privately insured patients because of the vaccine cost and reimbursement issues. More family physicians made this claim as compared with pediatricians.

"Although large-scale withdrawal of immunization providers does not seem to be imminent, efforts to address the root causes of these financial pressures ... should be undertaken," the researchers wrote. (Pediatrics 2008;122:1325-1331.)

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