Q: I’ve heard that hospitals make more money treating COVID-19 patients, so they are labeling more patients as COVID-positive than they are actually treating for COVID-19. Is this true?

A: This is not true. There is a false rumor circulating that hospitals are misrepresenting COVID patient data to increase federal reimbursements for patient care. It is true that the Coronavirus Aid, Relief, and Economic Security (CARES) Act increased reimbursements to hospitals for Medicare patients with COVID-19 due to the high cost of COVID-19 patient care.

However, it is not true that healthcare providers have an incentive to misrepresent a patient’s COVID-19 status. To begin with, a misrepresentation of a patient’s COVID-19 status would be fraudulent, exposing the provider to civil and even criminal liability. 

Second, the clinicians who decide whether to diagnose patients with COVID-19 have no economic incentive to do so. The way physicians in hospital systems are compensated for the services they provide is not based on what Medicare or other payers reimburse the hospital system for the care. A diagnosing physician is paid the same amount for services provided to a patient with or without a COVID-19 diagnosis. 

Third, Medicare’s increased reimbursements typically do not cover the increased costs of providing care to COVID-positive patients. COVID-positive patients often suffer more intense symptoms and potential complications than non-COVID patients. These patients often require a combination of medications and sometimes a ventilator for many days to support breathing. Even COVID-19 patients whose disease does not become more severe require more expensive care, including increased use of personal protective equipment, seclusion, and more rigorous disinfection routines. The modest increase in Medicare reimbursement does not come close to covering the cost of care. 

Finally, Medicare is the only payer that has increased hospital reimbursement for COVID-positive patients. Therefore, for the vast majority of patients under age 65, there is no increase in funding for hospitalized COVID-19 patients