Minnesota Blues CEO Craig Samitt on COVID-19, 2021 Rates Increases, Telehealth, Medicare for all, and WFH

May 3, 2020

Minnesota health insurance executive sees healthcare utilization peaks and valleys because of COVID-19.

On COVID-19 cases
We represent about 40% of all of the insurance in Minnesota. And so while we don't necessarily tally our membership against the Minnesota experience, you know, you can estimate that, that of the 2,500 or so cases that we've experienced that, in all likelihood, you know, in the ballpark of a 30% to 40% range would represent the impact that that our membership has had. I think the impact for us has been, frankly, what it's been for everyone. It's this is a scary and a surreal and unprecedented time.

On BCBSMN expenditures this year
Right now, our current projections are that it [lack of expenditures for elective procedures and other routine care] won't be an offset, that actually we would experience or at least we're projecting to experience a financial loss.

We think that we're going to see some significant financial fluctuations over the course of the rest of the year, and then, frankly, that that's the role that an insurance company plays that, that we are there to support the peaks and the valleys of, of healthcare coverage and care delivery that that comes in goes through the course of a community's lifetime. So in the near term, you're right, we're seeing a deferral of elective procedures, we estimate that we've seen it at least a 50% reduction in services. And so in the immediate near term, we're certainly seeing a decline in services and obviously a decline in cost.

The next wave, we expect is going to be a significant surge in expense. Minnesota is not quite at its peak. And we don't envision that we may be at our peak for up to another 15 to 30 days. So we're expecting, as we've seen in other states, a significant rise in costs associated with [COVID-19] testing with treatment.

I think the third phase is also going to be likely a savings phase that immediately after the peak. I think we would expect to go back to a period where folks may be concerned about going back to the hospital or going back to physicians, even for elective procedures, just because we're fearful about recurrence, so I think we're going to see a low utilization.

And then the last phase will essentially be recovery, which is all of the pent-up demand, as we feel more comfortable.

So when we look at it longitudinally, there's going to be there's going to be valleys and there's going to be peaks, and at least our projection right now, it’s going to be negative not positive in terms of utilization cost.

On 2021 rate hikes
I think it's likely too soon to tell. I know that many organizations are beginning to analyze pricing for next year, but there are so many variables and there's so many moving parts.

I don't know if we would expect, if we envision, that there's going to be a new surge of cases. Perhaps so. But if there isn't a recurrence of the pandemic next year, then the question is, is would we expect utilization to be on par with what it was before the pandemic or potentially even less?

We've been calling it the day after tomorrow, the day after tomorrow we envision that they're going to be many more services provided in the home or in the community or online. I think there's still going to be some hesitancy about going to go to the emergency room or to the hospital or . going go to the doctor with minor complaints. And so we could estimate that we may potentially see a lower utilization in 2021.

The final thing that I would say [if there an economic depression], I don't think employers will be able to, and individuals will not be able to, afford significant premium increases. And so I think we will all want to do what we can to suppress inflationary returns on pricing, because we just won't be able to sustain it and afford it as individuals or as a society going into the next year.

On telehealth 
I've mostly spent my career in in organizations that have wanted to fix healthcare and really transform the way we deliver care. And so I've been a fan of telehealth for decades now and I've been waiting for telehealth to have its day and that day is finally here. One of the very first things that we did was to open up telehealth immediately to our members through a through a partner [Doctor on Demand] who provides national telehealth. And we wanted to eliminate all barriers both technologically as well as financially.

So whether it was COVID-related symptoms or non-COVID-related symptoms, folks should stay at home. So we opened up that immediately. However, we also wanted to make sure that we helped our provider partners develop technology to see their own patients.

We've wanted to make sure that we can offer some resources and support for providers to connect but we also realized that you know, we should be paying for telehealth services, at least in the near term comparably as we pay face-to-face services if, if it's the same type of visit that a patient would have with their doctor face-to-face, and it's approximately the same amount of time for the physician, why would reimbursements not be more comparable?

So I think we're going to reevaluate everything, including payment policy. Obviously, there have been historical restrictions that have predominantly been CMS-based, but I think we all have had them and that we have to review these policies and change them so that we can offer a much more convenient and, in some cases, equally high quality service to patients through virtual means.

We wouldn't have thought that it would be this type of shock to the system to really launch us into a reinvented future. But I think that reinvented future is now here, and I don't think there's going to be a going back. I think that this is here to stay.

On advancing payments
We've accelerated about $80 million in advance payments to providers in numerous different ways, including to network providers who have participated in various forms of value-based care and payment models. And not to mention just to really remove all the bureaucracy and the speed of claims payments so that there's no need for a claims hold. Let's pay the claims.

And the last thing that I would say that we've done, which is not just near term, but it's longer term is we have very much advocated for what we call a joint accountability model, which is that we need to have financial alignment between payers and providers that are accountable for better care at a lower cost.

One of the things that we're looking at is, can we much more rapidly accelerate paying providers on a population health perspective, so that whether there's peaks or valleys with services, providers are [financially] stable through at all.

On healthcare change
I think this will change us. I think the virus will change us. The way we care for patients, and the way that we pay for care,  is going to change.

I don't necessarily see this as the burden of a transformation of the payment model.  I see this as a much more stable and secure payment model that really learns from the significant challenges that this crisis has exposed in our industry and offers a much more stable and consistent solution afterwards. So I certainly am going to continue to advocate with our provider partners in Minnesota to move to closer joint accountability for better care and lower cost, and I'm hoping that we're successful.

On support for Medicare for all
We've been long an advocate for universal coverage, most mostly through a very effective patchwork quilt between public and private. And frankly, I think that that patchwork quilt will still exist, because there are many that will very much want and like and want to preserve their employer-based coverage.

But I do think that there likely be stronger support for Medicare-for-all-type programs coming out of the pandemic.

I've been advocating for, long before the crisis, is this notion of Medicare Advantage. Medicare fee-for- service is fee for service. So what I'm hoping we see is greater support for kind of broader Medicare Advantage, which I think has this continuity of coverage with employer-based models but also allow for value-based flexibility and freedoms.

On increases in Medicaid and ACA enrollment

We expect  that our enrollment will likely increase by as much as 25% as it relates to Medicaid. In terms of the individual, an exchange marketplace, we would, we would envision that we will also see a similar rise. The question is, is that, will that be temporary, or will that be permanent? The same would be true of Medicaid, because it's still too early to tell what the impact of on unemployment or underemployment will be in our marketplace.

On working with Minnesota state health officials
I think one of the things that we obviously can do best is to is to help support our members in terms of cost and coverage. So, you know, immediate coverage of the cost of treatment, or the cost of testing with no out of pocket responsibilities is certainly one of the very early moves that we made to support the state or to support the providers through advance payments as we talked about.

I think that there are other ways that we're now talking about to provide additional support, especially as it relates to contact tracing or surveillance or testing. It's sort of the somewhat unknown but highly imperative next area of focus to, to bring back our livelihood and to help people feel safe and kind of coming back out into the open. We've got an army of people who can kind of help in in every respect.

I think we're beginning to see examples of [help with contact tracing]  in some other states with other Blue plans and, and I think we very much want to be able to help in other ways and if the state is amenable and I certainly know that we would want to make our folks available if we can. I don't see why we couldn't help play a role. It feels like it would likely be an all-hands-on deck effort. And so it wouldn't just be us, but I would advocate for us to play a role along with others.

Right now we are having discussions with other health insurers to really understand and how we can work effectively to play a role.  My last discussion that I had about this was just 45 minutes ago, so this is a work in process and we're hoping to talk to state officials yet next week if we can to see how we can potentially help.

On working from home.
I'm doing fine. Although I'm definitely an in-person guy. We've had town halls with all of our associates, I think I've spoken virtually to over 2,500 of our people in the last week.

I just think we've underestimated how difficult working from home is. I would imagine several of us were enthusiastic at first, you know, we've all got the hairy, four-legged coworkers at our feet, and that's great. But I think we have to remember that, beyond just keeping our people safe, clinically and physically, we have to keep people safe behaviorally and socially.

I have to kind of follow my own advice when I talk to our people about taking breaks and realizing that when you're at home, there is no longer any beginning and end of your workday. So you can just become a total workaholic. And that's me by nature. It's worse at home. So I think we have to remember to take a break and take care of ourselves through this crisis.

[Yesterday] it was a 4:30 a.m. start and I didn't finish until midnight. So I can't keep that up. I'm hoping that it's a shorter day today.