4 Ways Insurers Can Turn ‘Embarrassment of Profits’ into Solutions that Matter

October 8, 2020

Even as many industries continue to suffer devastating setbacks due to the COVID-19 pandemic, one sector that has enjoyed an “embarrassment of profits” is health insurance.

Even as many industries continue to suffer devastating setbacks due to the COVID-19 pandemic, one sector that has enjoyed an “embarrassment of profits” is health insurance. UnitedHealth Group, Anthem, and Cigna all recorded over $1 billion in profits in the second quarter fueled by unprecedented deferrals of elective surgeries and routine care, resulting in fewer claims being paid.

In sum, the revenue insurers have incurred during COVID-19 has far surpassed the costs they have avoided. These eye-popping profits led house lawmakers in August to declare they would launch an investigation into insurers’ business practices, and has cast an extremely unfavorable light on insurers at a time when their support for hospitals and healthcare systems is critical.

Providers have seen their revenues plummet, pushing some to the brink of bankruptcy, particularly in rural areas, while others have accelerated their efforts to merge with partners in order to survive the pandemic.

At a time when millions have become infected with COVID-19, and hospitals and healthcare systems are undergoing one of the greatest challenges they have ever experienced, insurers are in danger of being viewed through the same unflattering lens as big tobacco or pharma. Indeed, the tragedy of the pandemic has caused many insurers to evaluate what their roles should be right now. But rather than focusing primarily on counteracting public perception, insurers ought to identify areas where they can meaningfully improve their outcomes and demonstrate considerable value to providers, employers, and members.

Several insurers have taken actions in recent months that should be applauded and emulated. For instance, United Health has spent billions of dollars to support its providers amid the COVID-19 crisis and has lowered premiums and copayments for its members. Meanwhile, ten insurers have returned millions in premium refunds and rebates to members due to help lower members’ healthcare costs during the COVID-19 pandemic.

Other insurers including BCBS of South Carolina and BCBS of Minnesota have actively participated in statewide “Slow the Spread” public health campaigns aimed at sharing current health information and best practices with the general public. As part of that effort, BCBS Minnesota put forth employees as volunteer contact tracers for the state’s health department, and BCBS South Carolina has supported television and social media ad campaigns that encourage the public to take steps to reduce transmission.

These efforts are commendable and demonstrate that many insurers are taking steps to address the needs of providers and members. But there is even more to be done. Here are four additional actions they can take in the coming months to contribute in meaningful ways.

  • Increase access to care: Importantly, COVID-19 diagnosis and care must be accessible to patients across all socio-economic levels. To that end, insurers should act swiftly to make COVID testing both free and widely available. While some insurers have provided COVID testing at no cost for a limited time, this effort should be expanded to support free or fully reimbursable testing for as long as we’re grappling with the pandemic.
  • Cover Telehealth: Once a rarely used service, telehealth has become increasingly accepted and important during the pandemic. In March, several insurers began to reimburse telehealth and even waive costs for these appointments in tandem with the temporary expansion in Medicare-covered telehealth. Going forward, insurers should fully cover telehealth at rates on par with in-office visits to ensure patients have ongoing access to this essential service.
  • Support frontline physicians: Bearing the cost of support services for frontline physicians is another way insurers can provide value to their networks. For example, BCBS of South Carolina offered free, personalized, on-the-go COVID education to 25,000 physicians across the state to ensure they are positioned to apply emerging COVID information to their practice. Payers can also move to support physicians across their networks with services such as clinical surveillance technology to help identify patients in need of active intervention, monitor medication usage, and identify trends such as disease clustering. In addition, they can offer behavioral health treatments and medication at free or reduced rates to help address the needs of frontline providers who have reported higher levels of stress and anxiety since the onset of the pandemic.
  • Simplify coding: Insurers should provide simple and consistent coding requirements for all COVID-related procedures. At present, providers feel payers regularly move the goalposts by continually changing coding requirements, resulting in sub-optimal reimbursement rates and frustration for providers, administrators, and patients. Insurers can ameliorate this issue by taking steps to simplify and improve the consistency of COVID medical coding to ensure providers are paid on time for services rendered and patients have greater peace of mind.

The more payers are able to propose and enact practical solutions like these, the sooner they will work together with providers as one cohesive healthcare system positioned to tackle one of the greatest health crises we have ever experienced. By taking decisive action, insurers can seize the opportunity to make a long-lasting impact for their members and providers, as well the greater community, and ultimately, population health.

Mary Ellen Beliveau is CEO and founder of Knowledge to Practice (K2P).