Unbiased Analysis of Today's Healthcare Issues

Influenza Vaccination: Part V

Written By: Jason Shafrin - Dec• 18•06

A final analysis of the cost of flu vaccination is provided to us by Margaret Coleman, John Fontanesi and colleagues (2004). The authors examine the cost of the vaccination for different size practices in a scheduled visit and walk-in setting. Unlike most studies, this research team decided to applied overhead expenses to cost of vaccinations. While the marginal cost of overhead from a vaccination is zero, there is an incremental cost when the physician/firm decides to offer vaccinations. Vaccination storage, hazardous waste disposal, employee training and other fixed costs are incurred when the firm decides to vaccinate its patients. Thus, policymakers should take these costs into account if they wish to price services at average cost, but not marginal cost.

The costs of an influenza shot are as follows:

Scheduled Visit

Vaccine costs Clinical Labor Non-clinical labor Overhead Total
Solo/Partner $8.84 $2.10 $25.47 $9.86 $46.27
Small $8.51 $6.05 $10.32 $9.57 $34.45
Medium $8.19 $2.00 $8.10 $9.48 $27.77
Large $7.86 $1.68 $6.46 $9.22 $25.22
Corporate $7.54 $1.35 $1.55 $9.14 $19.58
Walk-in Clinic
Vaccine costs Clinical Labor Non-clinical labor Overhead Total
Solo/Partner $8.84 $0.95 $25.47 $4.53 $39.79
Small $8.51 $2.75 $10.32 $4.42 $26.00
Medium $8.19 $0.91 $8.10 $4.32 $21.52
Large $7.86 $0.76 $6.46 $4.21 $19.29
Corporate $7.54 $0.61 $1.55 $4.17 $13.87

The vaccination cost includes the actual cost of the vaccine, plus shipping, handling and storage, less any bulk discount. At the time of the publication of this paper, Medicare payment rates were only around $12-$17 per shot. This payment rate would have only covered average costs in the case of corporate firms operating walk-in clinics.

  • Coleman, M. S., J. Fontanesi, M. I. Meltzer, A. Shefer, D. B. Fishbein, N. M. Bennett and D. Stryker. “Estimating Medical Practice Expenses from Administering Adult Influenza Vaccinations.” Vaccine, 2005, 23 (7), pp. 915-923.

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  1. Tom Leith says:

    Do we know whether the Medicare reimbursement is incremental to a Level 1 office visit? I’m thinking it is, so the doc would bill a 99211 and a 9065[7|8|9] for a total reimbursement of about $20 + $15 = $35.

    Now that I think I know the reimbursement, I want to see the cost analysis in detail, and ask especially whether even $10 in non-clinical labor represents a reasonable or unreasonable cost. Let’s say this is 20 minutes’ work. I’m not saying 20 minutes’ (incremental) work isn’t done — only that a more efficient workflow might avoid some of it or even most of it. Then I want to see how they allocated practice overheads to this CPT4 code.

    Bottom line: I’m suspicious of the analysis and want to read it…