COVID-19 accelerating changes in health benefits, specialists say

COVID-19 appears to be accelerating a focus on telehealth and preventive care, which could impact the healthcare benefits employers provide, specialists said this week at a CFO Live virtual conference.

“Whether it’s telehealth, food benefits, mental health, looking at other ways to service employees,” COVID has “put a focus on these emerging products,” said Brandon Thompson, CFO and regional vice president of operations at Humana. “Preventive health, over time, lowers hospital admissions. It does have an impact on overall health as well as the bottom lime, and we’re starting to see more diversity with the advancement of social determinants of health.”

As part of this trend, the pandemic appears to be accelerating aging baby boomers’ comfort level with meeting their doctors over video as a substitute for an on-site exam.

“This crisis might be allowing that older generation to adapt to technology a little sooner than they were before, because … this forces our hand to work with physicians differently,” Thompson said. “That will have a ripple effect on some of those trends, as well as the cost back to the employers.”

Bottom line pressure

Despite an influx of patients, many hospitals are struggling financially as COVID-19 drives up their basic operating costs, including for masks, gloves and wipes. At the same time, the pipeline of high-value services hospitals were built to provide has dried up. 

“Revenue has dramatically dropped for hospitals across the board, because of the style of care they’re oriented toward,” said Joe Richmond, vice president of finance of behavioral health at Kindred Healthcare. “This increased focus on basic, primary care is associated with different reimbursement and different costs. And the limited amount of supplies, especially of personal protective equipment, has really driven the costs up for hospitals, where face masks may be really cheap and routine now have become expensive.”

Meanwhile, demand for elective surgeries, which provide most of hospitals’ income, has dried up. “There’s some reluctance to have that knee surgery or that hip surgery, so it’s really a mixed bag as we see it financially,” Richmond said. 

Changing plans

The insurance industry will assess the pandemic’s impact for some time, but it’s likely to accelerate changes that have been in the works for years and impact the new look of both public and private healthcare plans going forward. 

“With employees being the biggest asset, what additional benefits can be built in?” Thompson asked. “When you’re building out your budget, deciding what you can’t afford to invest in, it’s interesting to watch how many things start to go beyond what we’ve known as healthcare and medicine in the past.”

Preventive care, diet, mental health counseling, and social determinants — household income, the type of work people do, the kind of environment and influences they’re exposed to — could all become part of employees’ plans, but whether these features are added on or replace something else remains to be worked out.

“Counseling, case management, telehealth … these are the exciting pieces to look at,” said Thompson. “But it adds more activity, and activity equates to money. These are the things we’ll need to continue to watch, for use rates, see how they play in. Is it a replace or an add-on to what was there before? We’re going to have to take some time to figure that out.”

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