With at-home Covid tests running scarce during the Omicron surge, the price gouging has begun, and everyone from restaurants to pet food stores appear to be trying to cash in.
Recent reporting by Vice found a Manhattan deli advertised an Abbott BinaxNOW rapid test (retail: $24) on the Seamless delivery app for $80. Meanwhile, an online-only pet store, Pet Foods by Village Farm, offered to deliver the same type of test for $50, and a liquor store was selling a “Covid fighter pack”, including rapid tests and hand sanitizer, for more than $100.
There have been reports across the country of vendors charging double or triple the normal costs of at-home Covid tests. One New York restaurant worker paid $180 for four test kits, the Los Angeles Times reported. And a Covid testing site in San Francisco’s Mission district is reportedly charging between $99 and $250 for rapid tests.
Authorities have warned that this is a growing problem. In a December statement, New York attorney general Letitia James encouraged people to report price hikes. “Fraudsters are on notice that if they attempt to price gouge during this new surge, we will not hesitate to take action,” she said, adding that her office had already seen reports of test kits “being unlawfully sold for more than $40 and up to $70 per package”.
A pack of two at-home rapid Covid tests should cost around $25. This week, Walmart and Kroger are raising prices for BinaxNOW rapid tests to the market price after a temporary government-mandated $14.
Pharmacy shelves have been picked clean of Covid tests as the Omicron variant continues its surge. Photograph: Callaghan O’Hare/Reuters
The Biden administration has tried to alleviate the situation by announcing plans to purchase and distribute 500m free rapid tests, and said today that at-home tests will be reimbursed by insurers starting next week.
But, with pharmacy shelves picked clean and lines at testing sites stretching for hours, people may be more willing to pay a premium to get tested.
The situation is reminiscent of the early days of the pandemic, when the onset of Covid unleashed a wave of price gouging for personal protective equipment, such as $70 hand sanitizer and N95 masks.
But how much of this is legal? According to the United States Public Interest Group, a nonprofit focusing on consumer issues, “Businesses are allowed to increase prices for critical supplies during an emergency, but they are not allowed to raise the price of products excessively to take advantage of the current pandemic.” The laws vary from state to state, but raising prices by more than 20% could be considered price gouging, the group said.
In California, that number is lower. Markups of 10% may be considered price gouging. Violators are subject to fines up to $10,000 and up to one year in jail.
“You should not be increasing prices during a state of emergency, as people need critical supplies to keep people safe,” said Jenn Engstrom, state director for California Public Interest Research Group, an advocacy organization. Engstrom suggests that those who see suspected price gouging file a complaint to their state’s attorney general – most have a phone number to call or online submission form.