An earlier AHIP report estimatedthat the direct costs of COVID-19 treatment for 2020 and 2021 wouldbe between $56 and $556 billion depending upon rate ofinfection.

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Revised reporting commissioned by America's Health InsurancePlans projects lowered costs estimates for hospitalizationsassociated with COVID-19, even as the per patient costs for thoseadmissions rise.

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Related: COVID-19 and the uninsured: Up to 2 millionhospitalizations and $42 billion in costs

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The report, conducted by Wakely Consulting Group,updates its March 30 report to reflect new data on the cost of thepandemic, utilization of healthcare and the effect of deferredtreatment. The earlier report estimated that the direct costs ofCOVID-19 treatment for 2020 and 2021 would be between $56 billion and $556 billion depending uponrate of infection.

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The new numbers also reflect a wide range of potential costsbetween $30 billion and $547 billion.

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Chart of estimated COVID-19 costsSource: Wakely Report

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But they are offset by the projected savings due to individualsdeferring treatment for other conditions; the costs for 2020 and2021 are estimated to drop by between $76 billion and $216billion.

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Chart of estimated decrease in overall health care costs Source: Wakely Report

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The report, published June 8, noted that the true nationalinfection rate was and remains unknown due to widevariations in testing, but said some projections posit a 3.5%infection rate.

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The researchers therefore crafted their projections at the lowerend reflect a 10% infection rate, which "represents a scenario inwhich there is an ongoing infection in both 2020 and 2021 butwithout significant spikes."

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Under the 10% scenario, costs for both years would run between$30 billion and $92 billion. Positing a 20% infection rate resultedin projected costs between $60.2 billion and $182.2 billion for thesame period.

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At the top end, a high infection rate of 60% would result incosts between $180 billion to $546.6 billion.

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"While the cost for diagnostic testing is implicit in ourinpatient and outpatient assumptions for those infected, we havenot included the potential for large scale testing costs into themodel," the authors wrote. "Several pieces of research have calledfor large scale population testing to limit the spread of thevirus."

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The report noted that despite increase healthcare costs due tothe pandemic, insurers have also experienced in drop in non-COVIDrelated claims because many people have deferred treatment forthose issues, "whether because of formal governmental rules orbecause of concerns over the virus."

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The study's authors noted that it was based on data available onor before May 10, and conceded that its results span a wide arrayof possible impacts.

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"We acknowledge the astonishingly broad range of potentialoutcomes, in total, by geographic region within the United States,and by health insurance line of business," they wrote. "Ouranalyses rely, in part, on rapidly evolving and diverse data setsand epidemiological studies from around the world.

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"Wide variation in variables such as data quality, testingavailability and prioritization protocol, demographics, smokingincidence, timing, and comprehensiveness of intervention measures(e.g. social distancing, lockdowns, etc.), reported hospitalizationrates and lengths of stay, hospitalizations requiring intensivecare unit ("ICU") services, health care system capacity andlabor/supply constraints, the availability and efficacy oftemporary health care facilities, and case fatality rates bycountry/region, to name a few, make it impractical to put forthprecise cost projections over two years," it said.

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