Business as usual for healthcare payors?

As health system employees and doctors place themselves in danger for patients, and their organizations hemorrhage cash during the COVID-19 pandemic, it appears to be business as usual for most payors.

Health plans continue to distract providers with valueless administrative hassles, including ever-increasing pre-authorization requirements, denials, down-coding algorithms, and the threat of retrospective review. As some health plans report record profits, there is no indication that the payors will provide any financial relief to physicians or hospitals during this crisis.

For example, at the peak of the COVID-19 crisis, a Southeastern health system had no choice but to settle its negotiations with a Blues plan at no increase for the next few years to get the plan to release its multimillion-dollar quality bonus. One of the largest for-profit payors is reportedly taking advantage of the surprise billing legislation by offering hospital-based physician groups absurd rate reductions, knowing the groups will go out of network and thus forcing the groups to the state-mandated median-fee schedule.

The health plans promote their coverage of COVID-19 cases with no copays or deductibles. But they fail to mention that 68% of the commercial lives in this country are covered by employers' self-funded plans, so the waived copays and deductibles are paid by the employers, not the health plans. And one can only guess the windfall profits the health plans are amassing as a result of video office visits versus in-person visits, unused funds earmarked for elective procedures, and grossly underutilized hospital services.

The leadership of America's Health Insurance Plans has recognized caregivers and health systems as heroes in this war on COVID-19. Contrary to their PR and rhetoric, the health plan industry has not shown solidarity with doctors and hospitals in a meaningful way; it's time that they do. The healthcare world has changed; why won't they?


*As seen in Modern Healthcare's Opinion & Editorial

Nathan Kaufman, Managing Director, Kaufman Strategic Advisors

May 6, 2020
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