COVID to extract double-digit hit to health plans

The total cost of COVID-19–apart from the hundreds of thousands of deaths caused by the virus–are beginning to emerge. For health plan sponsors, it is not a pretty picture.

A new survey of health plan members who contracted the virus during 2020 offers a look at the trendline of plan costs incurred by survivors of the plague.

Related: Chronic condition care in the age of COVID

The research was published by analytics firm ExlService, which examined health plan data of patients “using a sample commercial healthcare insurance population with continuous eligibility between Jan 2020 and Oct 2020.”

The study compares reported gaps in routine care and frequency of chronic conditions over a two-year period to determine whether a COVID diagnosis in 2020 was linked to increased diagnosis of chronic conditions following recovery from the virus. The study noted any increases in gaps of care reported in 2020.

The highlights (or lowlights) of the research included:

• COVID and no pre-existing conditions: The average per member per month insurance cost of $179 “jumps to and stays elevated, at an average of $470 per month for the next five months, an increase of 163%.”
• COVID and one pre-existing condition: Per member per month insurance cost jumps from $369 to $624 for the next five months, a 69% increase. “For people with two or more preexisting conditions, the average per member per month insurance cost is $1,541 for the five months following a COVID-19 diagnosis.”
• Gaps in routine care/screening during 2020: Utilization of basic primary care services and annual check-ups by those with chronic conditions “declined sharply during 2020 across a wide range of diagnosis codes,” the study reported. “Pre-hypertension screening, for example, fell 7.23% and lipid panel testing fell 6.85%.” Perhaps not surprisingly, many patients postponed colonoscopies.
• Projected cost of COVID plus routine care gaps: The study estimates that, as a result of this combination of COVID plus gaps in care, health plans will experience an increase in their “cost of care avoidance” expectations of about 18%. In other words, plans should brace for about one-fifth higher costs, at least over the short term, due to this one-two punch to employee health.

In sum, the total cost to plan sponsors of the pandemic will be felt for some years. What can plan sponsors do to address this now?

ExlService recommends several initiatives.

1. Identify at-risk plan members (keeping identities secure, of course) and make their vaccinations a top priority.
2. Make an extra effort to reach out to those plan members with multiple chronic conditions, especially those who contracted the virus. This is now more efficiently done due to the proliferation of virtual/online communications tools available to plan sponsors that interact directly with patients to encourage adherence and routine care utilization.
3. Identify those who have avoided routine care in 2020 and ramp up communication with them. “Health plans need to get a clear handle on their population data and start proactively reaching out to those who have delayed care and are in need of preventive care.”
4. Continue to monitor the data on post-COVID health of plan members to inform plan design and member communications.

Read more: 

• Health care costs and coronavirus stoke employee anxiety: How employers can help
• The pandemic’s effect and how brokers can help clients reduce health care costs
• Health care utilization and spending finishing the year lower because of pandemic