What the U.S. Government Can Do to Address Energy Insecurity

By Sanya Carley and David M. Konisky

Energy insecurity—defined as the inability to pay one’s energy bill or avoid utility disconnection—is a pervasive and growing problem in the United States. Approximately 4.7 million low-income households were unable to pay an energy bill over the past year, 4.8 million received a notice for utility disconnection, and 2 million were disconnected from the electric grid, according to a recent study. Energy insecurity is disproportionately borne by people of color, as well as households including small children or individuals that rely on electronic medical devices.

Without access to electricity and other energy services, people cannot maintain adequate body temperatures, keep perishable food or refrigerable medicines cold, and power electronics like e-learning or medical devices. People experiencing energy insecurity face impossible tradeoffs between paying their utility bills and purchasing other necessities, such as food or healthcare services, and may resort to risky financial decisions (like using payday lending) or dangerous heating behaviors (like burning trash, using ovens for space heating, and relying on space heaters).

In the early months of the COVID-19 pandemic, Congress and state governments provided some protection for U.S. families from the worst consequences of energy insecurity. The CARES Act provided financial support through direct cash assistance and enhanced unemployment to many Americans facing material hardship. At the same time, almost 30 states banned energy utilities from disconnecting their customers due to a lack of payment. These protections, however, have largely been diminished as the pandemic continues. As of the start of February, only seven states and the District of Columbia still had emergency utility disconnection protections in place—with five set to expire before April. And while these critical supports fade, our research shows energy insecurity is deepening across the country, and likely to get even worse.

Energy Insecurity is Pervasive—But Cash Assistance Helps

Since the onset of the pandemic, we have conducted surveys of a nationally-representative sample of 2,000 households with incomes at or below 200 percent of the federal poverty line. Their responses reveal that millions of low-income Americans are struggling to pay their energy bills and avoid electric utility disconnection. From May through August, 21% of the households we have surveyed reported not being able to pay at least one monthly electricity bill, nearly 15% received a shutoff notice, and 6% had their service disconnected. There are also large racial disparities in energy insecurity. When compared to low-income white households, Black and Hispanic households are about 2 times more likely to be unable to pay their energy bills and between 3 and 8 times more likely to have their electricity shut off, respectively.

During the summer months, our survey further revealed that nearly one in five low-income households had to forgo other basic necessities such as buying groceries or accessing medical care to pay an energy bill. Others chose to delay payments to energy utilities, which means deferring payments (often with late fees) to the future. Nearly 40% of respondents indicated that they have at least some utility debt. In cases where utility disconnection protections are lapsing, consumers that carry debt may face immediate disconnections, which are typically accompanied by steep disconnection fees and subsequent reconnection charges.

Importantly, our analysis of the survey responses shows that households that received cash assistance from the federal government had lower rates of energy insecurity. For example, recipients of emergency assistance from the federal Low-Income Home Energy Assistance Program (LIHEAP) and people that received a CARES Act check were less likely to miss paying a bill or face the risk of service disconnections. These programs, therefore, effectively reduced energy insecurity in our sample of low-income households.

What Can Government Do Now?

Energy insecurity is a chronic problem for millions of Americans that will require long-term solutions to alleviate material hardship, improve the energy efficiency of homes, reduce energy burdens, and carefully consider how to protect vulnerable populations from utility disconnection. The COVID-19 pandemic has indisputably made matters worse and there are several things that policymakers should immediately do to alleviate the burden of energy insecurity:

  • The federal government should impose a national moratorium on energy utility disconnections so that no Americans lose access to critical energy services until the economic disruption from the pandemic eases. A federally-mandated moratorium on disconnections can provide much needed protections while superseding the patchwork of temporary state protections. In the absence of a national moratorium, governors should put state-level protections in place.
  • Congress should more deeply invest in the Low-Income Home Energy Assistance Program to provide eligible Americans with short-term, emergency cash assistance to pay energy bills so as to avoid disconnections, and more significantly invest in the Weatherization Assistance Program to improve the efficiency of their homes for the long-term.
  • States should revisit their long-standing utility disconnection protection policies now that we have learned more about the prevalence of energy insecurity across the United States, both in general and for vulnerable populations in particular.

Who Will Cover the Cost of Your COVID-19 Vaccine in Our New Normal?

Historically, mass vaccination drives have had their ups and downs. For example, both rollouts of the smallpox vaccine were relatively smooth for their time. But the distribution of the polio vaccine suffered when children began developing polio in their arms (at the injection sites), and African American children lacked access to the vaccine due to a higher percentage of working parents unable to get them to an appointment. By the time the H1NI vaccine came about many years later, the vaccine campaign had already quieted because the disease was ultimately benign.

As we recover from 2020 and navigate the present vaccine push in 2021, COVID-19 vaccination numbers are increasing — along with rising healthcare costs. That said, do you need insurance for the COVID vaccine? According to the Department of Health and Human Services, the COVID vaccine must be administered without out-of-pocket costs, and the federal government is picking up the tab for the tens of millions of vaccine doses Americans are receiving.

How this works varies, though. Participating providers cannot charge Medicare beneficiaries, and providers must waive all copays and coinsurance payments. Providers that participate in Medicare will receive an administrative fee for giving COVID-19 vaccine shots to patients. For people who are privately insured, vaccine registration sites may require a health insurance card to cover the costs. Still, even out-of-network providers should not charge copays. Fortunately, even Medicaid patients and people who are uninsured can receive the vaccine for free due to the CARES Act. These providers are reimbursed through a relief fund.

Does Health Insurance Cover Preventative Care?

Even in light of increasing vaccine access, the pandemic has underscored the importance of health insurance, which almost always covers preventative care services with no additional healthcare expenses. If your plan is subject to current requirements, you may not have to cover a copayment, coinsurance, or deductible to receive some of the recommended preventive health services, such as screenings, vaccinations, and counseling.

Depending on your age, you may have low-to-no cost access to these preventative services:

  • Blood pressure, diabetes, and cholesterol tests.
  • Many cancer screenings, including mammograms and colonoscopies.
  • Counseling on quitting smoking, losing weight, eating healthfully, treating depression, and reducing alcohol use.
  • Regular well-child visits, from birth to age 21.
  • Routine vaccinations against diseases, such as measles, polio, or meningitis.
  • Counseling, screening, and vaccines to ensure healthy pregnancies.
  • Flu and pneumonia shots.

To be clear, the preventative services provision only applies to those enrolled in job-related health plans or individual health insurance policies issued after March 23, 2010. If this applies to you, this provision applies as soon as your plan begins its first new “plan year” or “policy year” on or after September 23, 2010. Check your health plan’s website to learn more about what’s covered and which healthcare expenses you may have to pay out of pocket.

Forecasting Post-COVID-19 Vaccine Coverage and Healthcare Expenses

Typically, you need to provide proof of health insurance to receive a vaccine at no cost. But coverage of the COVID-19 vaccine currently differs from other typical treatments and medications, thanks to the federal government’s Provider Relief Fund — regardless of health insurance status or how much vaccines usually cost out of pocket.

But what will vaccine coverage look like when the world returns to “normal?” Based on what we know now, here are some predictions:

1. Vaccines will fall under regular preventative care rules.

Once the pandemic subsides and COVID-19 vaccines are fully licensed and part of preventative care, they will fall under the same reimbursement rules as other vaccines. Under the Affordable Care Act (ACA) of 2010, health plans must cover routine immunizations as a preventative service with no extra costs to patients.

Unfortunately, the ACA does not govern short-term health plans. These plans may require patients to share the cost of the COVID-19 vaccine or not cover it at all.

2. There will be more administration fees.

As life starts to resemble a “normal” rhythm, providers will likely charge an administration fee for giving the shot to a patient. This time, however, the federal government probably won’t pick up the costs. Instead, patients who opt to get the vaccine will be expected to cover the fee.

3. Vaccine costs may rise.

Because we are still in the middle of a pandemic and global health crisis, the COVID-19 vaccine is free, but it’s possible the big vaccine producers — Johnson & Johnson, Moderna, and Pfizer — will raise their vaccine costs at some point. In fact, they have already quietly touted plans to raise coronavirus vaccine prices.

As the world opens up, these price increases will most likely start to look more like other vaccine billing practices, similar to those for the flu shot. This means private insurance will cover the cost of the vaccine instead of passing it along to the federal government.

4. Health insurance costs may increase.

If the prices of COVID-19 vaccines increase with the addition of administration fees and private insurance footing the bill, we will likely also see an uptick in healthcare expenses. Projected rate changes for 2021 were moderate, but some health insurance companies implemented rate increases of about 25%. Still, time will tell whether health insurance premiums show significant changes.

While the federal government is currently striving to make the COVID-19 vaccine accessible with no additional costs, it’s far more likely that health insurance plans will cover the vaccine in the future. The return to normalcy emphasizes the importance of healthcare access after the pandemic — not just during it.

Take the time to learn about your options for when the vaccine is no longer administered for emergency use, which should put you in a good position regardless of any future changes.

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