The Zika virus isn’t a distant threat anymore. There have been well over 1,000 cases of the virus in America. The only US states that haven’t experienced an outbreak are Idaho, South Dakota, Wyoming, and Alaska. Until recently, all of these cases were tied to travel or sexual transmission. Local mosquitoes were not transmitting the virus. That changed this month when the first four cases of Zika infection from local mosquitoes popped up in Florida. 

There are now 15 Florida residents who were infected domestically by mosquitoes carrying the virus. These cases are centered around a small neighborhood in Miami. On August 1 the Centers for Disease Control and Prevention (CDC) issued a historic travel warning. For the first time ever, the CDC warned people against travel to an American neighborhood for fear of infectious disease.

The Zika virus causes only mild flu-like symptoms, but an infection during pregnancy causes serious birth defects. These birth defects include brain damage and microcephaly. The virus’ explosive spread has many wondering what a pandemic here might look like. Others wonder how we’ll pay for Zika prevention or care.

Who Will Pay for the Vaccine?

Vaccine Development Under Way

Vaccine research, development, and production is a process that often lasts 10 to 15 years. The Zika virus was first identified in 1947. There’s been plenty of time to develop a vaccine, but research has only just begun. Why? Because it takes a crisis to motivate vaccine development. And sometimes even that isn’t enough.

Vaccine creation typically works through what are called public-private partnerships. The government funds the initial research and partners with a private company willing to develop and mass-produce the drug.

Dr. Nick Chapman, the executive director of Policy Cures, an Australian NGO focused on the development and uptake of new drugs and vaccines in the developing world, believes these partnerships are “essential” in a world of limited resources. “Given the fact that the public sector generally doesn’t have the capacity to develop vaccines through to approval itself,” he says, “and that the pharmaceutical industry doesn’t have a commercial incentive to develop and market vaccines for these diseases, public-private partnerships represent a natural solution.”

The problem with this model is “Big Pharma” often doesn’t want to spend the time and money needed to turn that research into a vaccine.

Vaccines are not a money maker for pharmaceutical companies. They are extremely expensive to develop and the diseases they treat are sporadic. Breakouts usually hit the poorest areas of developing countries. “What the private sector is most interested in are developing treatments for diseases that are known, common and predictable,” Lawrence Gostin, Georgetown law professor, told the New York Times. Big Pharma rarely wants to pour millions of dollars into a drug the victims can’t afford to fight an outbreak that might disappear in a year.

This is why there still isn’t a vaccine for the Ebola virus that ravaged West Africa in 2014. However, now that Zika has spread to America and Western Europe, work on a vaccine has intensified.

The National Institutes of Health developed a vaccine years ago for the West Nile virus that was safe in early trials. They couldn’t find a private company to carry on this research at the time because curing the virus didn’t seem profitable. But West Nile is very similar to Zika, and the existing vaccine research might lead to a Zika vaccine. “I do not anticipate that we will have any problem partnering with pharmaceutical companies now,” Dr. Anthony Fauci, director of the National Institute of Allergy and Infectious Diseases (NIAID), told reporters last January.

Fifteen companies are currently working on a vaccine. The US government has finally managed to put aside partisan politics and approve funding for even more research. Inovio Pharmaceuticals has already inoculated its first volunteer. So has the NIAID as of August 2. We are close.

Will the Zika Vaccine Be Expensive?

Who will pay for the Zika vaccine if it is developed? Distributing it as widely as possible to at-risk populations seems like an obvious public health goal. But pharmaceutical companies expect to make a profit from their investment. Will the vaccine be affordable? What will be the government’s role in its distribution?

“There is no doubt that companies will seek and obtain patents,” says Professor Brook K. Baker of the Northeastern University School of Law, “indeed multiple patents on and around the vaccine, which will give them monopoly pricing power. In addition, vaccines can sometimes create a natural monopoly because they are hard to make.”

Baker teaches in the Program on Human Rights in the Global Economy. He also is a senior policy analyst for Health GAP (Global Access Project). He’s worked extensively to make treatment and prevention programs available internationally for people with HIV and AIDs.

“In all likelihood,” Baker says, “a vaccine for Zika would have a market primarily in tropical countries, but the area of risk now includes portions of the US. Therefore, the market is a mixed one, meaning that there are rich countries that could pay as well as poor countries that couldn't (unlike Ebola, which is just in poor countries). This dual market means that there are more incentives for vaccine companies to invest in R&D [research and development] because of the prospect for high profit sales to at least some populations in the US, as well as significant middle-income country markets. However, there will also be significant additional efforts on vector control, which could significantly affect the market.”

Vector control is the elimination of animals or insects that carry an infectious disease. In the case of Zika, this means killing mosquitos. Draining standing water or using insecticides are examples of vector control. It is possible areas that cannot afford the vaccine will compensate with greater vector control.

Though the pharmaceutical companies will seek patents, Dr. Chapman argues there are still many checks on the power of the free market when it comes to life-saving drugs. “The short answer is that yes, for vaccines developed solely by pharmaceutical companies, the price is entirely up to them. But there are a number of caveats to this. For example, large global procurement agencies (such as Gavi or UNICEF) make use of the fact that they purchase large volumes of vaccines to negotiate they price they’re willing to pay. Countries themselves also negotiate directly with companies on price based on their capacity to pay, or make use of External Reference Pricing schemes.

“And of course advocacy groups (such as MSF Access) can bring social pressure to bear to try to force down the prices companies choose to charge," he adds. "Then there are examples like the Advance Market Commitment, which was used to help stimulate the development of new pneumonia vaccines for developing countries: under the AMC, Gavi committed to buy a certain number of doses of a newly developed vaccine at price X, after which the price would drop to price Y (or below) for subsequent doses. And finally, for vaccines developed by public-private partnerships, there can be conditions written into the development agreement that specify the price that can be charged in certain markets (e.g. low-income countries). One of the good things about public-private partnerships/PDPs is that they increasingly identify up-front what an acceptable price per dose would be, and then work to achieve this.”

Not only are there ways of controlling vaccine prices from the gate, but it’s also likely the government would help finance vaccine procurement if Zika becomes widespread. The 1962 Vaccination Assistance Act authorizes the government to negotiate vaccine prices with manufacturers and provide financial assistance to local health departments to support mass immunization programs. The 1993 Vaccines for Children Act also ensures free vaccines to uninsured children, those on Medicaid, and American Indian or Alaskan Navies.

“In the event of a broader outbreak in the US,” says Baker, “there would be clamor for a public health response, meaning widespread vaccination paid for by states and the federal government. Where insurance was available, there would also be vaccine coverage.”

If the Zika virus becomes a pandemic, the vaccine should be available to insured and uninsured alike. If it remains a minor regional threat, families will have to pay for the vaccine out of pocket or through their health insurance.

Who Will Pay for Treatment and Care?

Of course, what the Zika virus costs us extends well beyond the millions or billions spent on a vaccine. The birth defects associated with Zika take more than an emotional toll on affected families. They also have a high price tag in dollars.

The Zika virus' effects on infants can include:

  • Microcephaly (abnormally small head size)
  • Brain damage
  • Eye defects
  • Hearing loss
  • Impaired growth
  • Guillain-Barré Syndrome (an autoimmune disorder)

So far, the CDC has registered 12 babies born in America who may have been infected by Zika. These babies will need continuous and specialized care throughout their lives. The CDC’s Center for Birth Defects estimates the cost of caring for a child with birth defects to be anywhere from $1 million to $10 million each.

Frequent neurological exams, developmental screenings, monthly doctor visits, and family care plans will all be necessary for infants diagnosed with the Zika virus. Symptoms can also develop long after birth. All babies with risk of exposure will need to be closely monitored for Zika for years.

“If our current understanding based on the weight of evidence (that Zika virus is a cause of microcephaly) is correct,” says Dr. Chapman, “then failing to halt the spread of Zika will have an enormous cost, both in terms of the direct costs of care to governments and to families, and the indirect costs (and social impact) associated with the fact that many of these children won’t be able to participate in society as healthy, functioning adults. And add to that the suspected link between Zika and other foetal birth defects, as well as Guillain-Barré syndrome, and this has the potential to create a huge global economic burden.”

If 12 babies become 1,200, how will Americans—and US health insurance companies—bear the financial burden?

Zika and Maternity with Health Insurance

It is almost impossible to raise a child with severe birth defects without health insurance.

Luckily, the combination of 2010’s Affordable Care Act (Obamacare) and other American policies make it easier for new mothers to secure healthcare. The Newborns’ and Mother’s Health Protection Act of 1996 ensures they can enroll newborns in their insurance program at birth. They cannot be rejected due to any congenital conditions. This includes birth defects. If a mother is eligible for insurance but not enrolled, she can enroll within 30 days of delivery. The baby will be retrospectively insured and cannot be subject to a preexisting condition exclusion.

The Affordable Care Act includes “maternity and newborn care” as one of its “10 Essential Health Benefits.” This means every insurance plan sold on the marketplace must cover pregnancy and birth. Delivery also qualifies women for a Special Enrollment Period. They can enroll in or change Marketplace health insurance coverage outside the Open Enrollment period. The coverage begins the day the baby was born. Finally, Medicaid programs for people with low incomes also cover maternity and childbirth.

Uninsured women who deliver a baby affected by the Zika virus should be able to secure coverage no matter their income level. This insurance is effective the day the baby is born. As long as mom can pay her premiums, either the insurance companies or government programs will help bear the cost of any birth defects.

Zika and Maternity Without Health Insurance

Health insurance is crucial for raising a disabled child. One study of Florida infants with congenital heart defects found that uninsured infants had three times the mortality rate of privately insured infants.

Yet lack of insurance is still woefully common. Despite Obamacare and the broadened Medicaid program, 33 million Americans still don’t have health insurance. That’s over one in 10. The uninsured in this country are disproportionately poor, black, and Hispanic. More than four million are children. Immigrant families who don’t qualify for Medicaid account for seven of those 33 million. Seventy-nine percent of uninsured immigrants are Hispanic, a dominant demographic in states that are at highest risk for Zika.

These high-risk, southeastern states are also exactly where people are least insured. For example, Texas is a hotbed of mosquito activity. Yet it’s been the union’s least insured state for many years running. Over five million Texans lack health insurance. That’s 17 percent of Texas' population.

Not only are they the least likely to be insured, but low-income communities of color are also the most likely to be affected by the Zika virus.

Window screens to protect against mosquitos while indoors are key to Zika prevention. Poor families are not only less likely to have these, but also less likely to have air conditioning. They are more likely to keep their windows open both night and day. They are more likely to spend time outside and in public spaces. Uninsured pregnant women aren’t likely to know their baby has microcephaly until giving birth.

If the Zika virus continues to spread, uninsured communities of color will be hardest hit. The looming threat of viral pandemics is an excellent reason to revisit American healthcare policy and ensure care really is accessible for all.