How health insurers are responding to Covid-19

INSURANCE BY DONALD PFUNDSTEIN

The Covid-19 pandemic is posing unprecedented challenges to New Hampshire and our nation, and you may be wondering how health insurance carriers have been responding to these challenging times.

The state’s insurance companies are working with their health delivery partners — hospitals, health systems, and individual providers — to address the many challenges associated with the pandemic. They are also taking decisive measures to prevent and slow the spread of the disease, ensuring access to coverage for testing, diagnosis, and treatment for Covid-19.

Health insurance providers’ specific emergency actions during this crisis include:

• Eliminating patient cost-sharing for Covid-19 testing and treatment — no co-pays, no co-insurance, no deductibles. That removes a barrier to care and helps hospitals with guaranteed payments.

• Waiving prior authorization for those seeking testing or treatment of Covid-19.

• Waiving cost-sharing for telehealth services and dramatically expanding access. This eases the burden on the health system, allowing hospitals to care for people who need it most, while limiting the exposure of healthcare workers and patients to the disease.

• Protecting patients from surprise medical bills from health providers. By covering testing and treatment without application of cost shares, health insurance providers are doing their part to protect patients from surprise medical bills. Carriers are encouraging health providers everywhere to refrain from sending surprise medical bills to patients during this national crisis.

• Health insurance providers are working to simplify or change medical management processes on an emergency basis, including simplifying and accelerating the discharge and transfer of patients from hospitals to the safest available, clinically appropriate post-acute care facility or home.

• On March 19 and April 8, the trade group America’s Health Insurance Plans joined together with the Blue Cross Blue Shield Association to urge Congress to help families and businesses get and maintain their healthcare coverage. Recommendations included providing new funding to ensure that Americans who lose their jobs during the Covid-19 pandemic can maintain their coverage, and establishing a temporary emergency risk mitigation program to ensure that health premiums do not spike and that health care benefits remain stable.

AHIP and its members emphatically supported the direct federal funding for hospitals and health care providers in the emergency relief legislation signed by President Trump. This emergency funding includes $100 billion in direct federal assistance, a 2% increase in Medicare payments for all providers, and a 20% increase in Medicare inpatient care payments for Covid-19 related claims. Governor Sununu’s Emergency Order #9 creates a Healthcare System Relief Fund of $50 million for hospitals and providers. If it is found that these federal and state efforts are not enough, New Hampshire’s health insurance companies would support further government enhancement.

Health insurance providers also feel the enormous financial consequences of the Covid-19 pandemic. In one study, experts estimate that in the commercial health insurance market alone, Covid-19 testing and treatment costs in the first year could reach $250 billion in a worst case scenario. That amount is more than the total capital and surplus held by the entire health insurance industry in 2018 and does not even begin to contemplate the costs to be borne by Medicare Advantage and Medicaid managed care.

Another study estimates that the costs of Covid-19 testing and treatment to health insurance providers — commercial, Medicare Advantage and Medicaid managed care plans — could range from $56 billion to $555 billion over the next two years. Health insurance providers must have the necessary funds to cover all of the unexpected costs related to Covid-19.

At the same time, economic shockwaves are putting businesses and their workers at high risk – including their ability to afford their current health insurance coverage. The combination of surging unexpected costs along with shrinking premium dollars due to the enormous pressure on businesses, families and individuals is putting a serious and significant financial strain on health insurance providers.

New Hampshire’s health insurance carriers are fully committed to helping the state’s healthcare system meet the challenges posed by Covid-19 by adopting emergency measures and working with the state’s policymakers and stakeholders on ways to make health insurance coverage more affordable for New Hampshire’s employers, employees and families.

Attorney Donald J. Pfundstein, a shareholder and director of the Concord-based firm of Gallagher, Callahan & Gartrell, focuses on regulated industries. His clients include America’s Health Insurance Plans. His colleague Heidi Kroll as well as AHIP staff helped with the work on this article.