In recent years, advanced regularization techniques have emerged as a powerful tool aimed at stable estimation of infectious disease parameters that are crucial for future projections, prevention, and control. Unlike other system parameters, i.e., incubation and recovery rates, the case reporting rate, Ψ, and the time-dependent effective reproduction number, Re(t), are directly influenced by a large number of factors making it impossible to pre-estimate these parameters in any meaningful way. In this study, we propose a novel iteratively-regularized trust-region optimization algorithm, combined with SuSvIuIvRD compartmental model, for stable reconstruction of Ψ and Re(t) from reported epidemic data on vaccination percentages, incidence cases, and daily deaths. The innovative regularization procedure exploits (and takes full advantage of) a unique structure of the Jacobian and Hessian approximation for the nonlinear observation operator. The proposed inversion method is thoroughly tested with synthetic and real SARS-CoV-2 Delta variant data for different regions in the United States of America from July 9, 2021, to November 25, 2021. Our study shows that case reporting rate during the Delta wave of COVID-19 pandemic in the US is between 12% and 37%, with most states being in the range from 15% to 25%. This confirms earlier accounts on considerable under-reporting of COVID-19 cases due to the impact of ”silent spreaders” and the limitations of testing.