Breaking down cost of COVID response
The state paid for more than 1.4M tests, at about $91 each
After a year of keeping COVID-19 testing rates secret, based on the wishes of the hospitals and laboratories involved, the state Monday released unredacted contracts showing that it paid anywhere from $25 to $150 for a test.
The state Comptroller signed contracts with 10 hospitals and laboratories in May 2020, when the state ramped up COVID testing. The records released Monday show that Quest Diagnostics was paid by far the most money, with $84.2 million out of about $130 million total.
Last May, Gov. Ned Lamont asked the comptroller’s office to enter into contracts for COVID-19 testing to monitor the virus in frontline state workers, ensure laboratories could hire staff and expand capacity, and open emergency clinics in communities to contain localized outbreaks, Comptroller Kevin Lembo said Monday.
Under the contracts, which are now completed, over 1.4 million tests were performed, with an average cost of $90.86.
High-risk residents and those in underserved communities received more tests than any other group, followed by frontline state employees and staff at the state’s social service hospitals and group homes, the Comptroller said.
Lembo said the state “has already secured two rounds of reimbursement from FEMA to cover the costs of testing and anticipates several additional grants in the future that will make the state whole.”
“At the onset of the pandemic, there was virtually no testing capacity in our state,” Lembo said. “I’m grateful for the collaboration between these providers and labs and my office. Under immense pressure, and without precedent, those efforts helped save lives and position Connecticut as a leader in fighting back against the virus.”
The fee structures for the different providers varied based on a number of factors.
There are several state agencies, besides the Comptroller’s office, that entered into testing contracts, including the Department of Public Health, the Department of Correction and the Department of Social Services. Each of them set their own rates and fees.
In addition, most of the contracts include multiple fees. There are payments for collecting specimens, which went mostly to hospitals or pharmacies, as well as payments for doing the actual tests, which mostly went to four laboratories.
Some labs also were paid higher rates for weekend testing and different rates for antibody tests.
For example, SEMA4, a Stamford-based company, started with a contract that would pay it $35 more per test if the tests were done on the weekend. The lab’s per-test fee was $100 but went up to $135 on the weekends.
The contract with SEMA4 was amended three times, and the rates decreased as the amount of testing needed on state employees decreased.
Quest Diagnostics, which was the first laboratory to do testing in the spring of 2020 when tests and supplies were sparse, has always been paid $100 per test, which means Quest has done more than 842,000 COVID tests since last May.
There were three hospitals or hospital systems involved in the testing program. Griffin Hospital took in the most of any hospital with $12.3 million, according to the Comptroller’s records.
The state’s two largest hospital groups, Hartford Healthcare and Yale New Haven Hospital, received $3.1 million and $1.27 million, respectively.
Some of the hospital contracts included built-in fees that were “passed through” to the laboratory they used to do the actual testing.
For example, Hartford Healthcare was paid $110 for every test sent to Quest and only $25 for tests sent to Jackson Laboratory, because part of Hartford Healthcare’s fee with Quest was to pay that laboratory to do the testing.
“Hartford Hospital had a preexisting relationship with Quest, so that reflects the total price. For HHC to collect one test and send it to Quest to analyze, the total cost for (the state) would be $110,” Comptroller’s spokesman Tyler Van Buren said.
“They (Hartford Healthcare) paired with Jackson to increase capacity, but our office already had a contract with Jackson. So HHC would collect a sample and send it to Jackson. We’d pay HHC $25 for their collection and then we’d pay Jackson directly to analyze the sample,” he said.