Payers Have Various Strategies for COVID-19 Treatment Cost-Sharing

August 20, 2020 - While by and large patients were under the same waivers for coronavirus testing, payers have implemented a broad range of strategies to handle coronavirus treatment cost-sharing for the long term, a new brief from Peterson-Kaiser Family Foundation (KFF) Health System Tracker revealed.

Many payers put in place temporary coronavirus treatment cost-sharing waivers at the beginning of the crisis. In fact, a couple of major payers eliminated cost-sharing before the public payers, such as Medicaid, made any moves to zero-out beneficiary cost-sharing for coronavirus treatment.

The researchers combined plan response data from America’s Health Insurance Plans (AHIP) and enrollment data from the National Association of Insurance Commissioners and Mark Farah Associates. The enrollment data reflected the first quarter and the plan response information stretched from the beginning of the crisis to July 31, 2020.

Based on this data, the brief estimated the number of Americans—excluding those covered by a self-insured employer—who did not have to pay COVID-19 treatment cost-sharing under their current payer’s policies. Notably, by excluding self-insured employers, the researchers were blind to what over 60 percent of Americans face who are enrolled in such plans.

To date, the federal government has not yet issued any requirements about private payers covering cost-sharing for coronavirus treatment, although some state governments have mandated that private payers cover cost-sharing. Thus, the study’s results largely demonstrate payers’ own initiatives.

By May 2020, 69 percent of payers said they were fully covering coronavirus treatment and only eight percent said that they would not be covering coronavirus treatment, an Xtelligent Healthcare Media report found.

Nearly nine in ten enrollees on the individual health insurance market and fully-insured market (88 percent) have seen some kind of cost-sharing waivers for COVID-19 treatment.

However, coronavirus-related waivers and programs are expected to end. For example, WellCare’s social determinants of health support programs will expire in December 2020, along with most of its coronavirus benefits and policies.

Payers vary on their timelines for waiver expiration dates, echoing the general air of uncertainty in the industry.

One in three payers on the individual and fully-insured markets (31 percent) have, similar to WellCare, set their coronavirus waivers to end in December 2020, according to the Peterson-KFF Health System Tracker brief.

Over a quarter of plans on the individual market (26 percent) and 12 percent of fully-insured group plans have not set a deadline for their waivers at all or have fixed the end date to the public health emergency lift date, which remains unknown.

Waivers for around 20 percent of individual and fully-insured group market plans have already expired.

But cost-sharing waivers are not the only way that payers are addressing coronavirus treatment costs.

In a less direct attempt to defray member healthcare costs, other payers are delivering financial relief in the form of premium reductions.

Around 11 percent of individual market plans and 27 percent of fully-insured group market plans, such as Priority Health, have offered premium credits or reduced premiums.

Another seven percent of health plans in the individual health insurance market and seven percent in the fully-insured group health insurance market, like UnitedHealthcare, are giving members extended grace periods on premium payments. The IRS has granted this flexibility for cafeteria plans as well.

A sliver of the individual and fully-insured group health plans—just two percent in each category—have fast-tracked medical loss ratio reimbursements in order to get rebates back to eligible members more quickly.

“Motivated by higher-than-expected profits and some state requirements, many insurers have acted to offer financial relief to their enrollees, primarily through reduced COVID-19 treatment costs and less commonly through forms of premium relief and waivers on out-of-pocket costs for telehealth use,” the researchers reported.

“That said, many of these cost-sharing waivers have either expired or soon will, meaning more privately insured people will be exposed to high out-of-pocket costs associated with COVID-related treatment and hospitalization.”