From fear of travel to feeling its simply not a good time to take time off, surveys show that the number of unused vacation days is building. Consulting firm Willis Towers Watson reports that a fourth of employers plan to increase rollover limits to minimize lost vacation days. Others are hesitant to relax their policy, citing financial concerns and the increased risk of employee burnout. Staycations, traditionally viewed as an opportunity to do things around the house and clear the mind, are being viewed very differently by those working from home.
What may be in short supply when a safe, effective Coronavirus vaccine is available? The medical glass needed to produce vials to hold the vaccine. With plans to produce more than a billion doses globally, Johnson & Johnson bought 250 million vials in the U.S. at the start of the pandemic. Corning recently signed a $200+ million deal with the U.S. government to expand manufacturing capacity to meet demand.
With many patients still worrying about contracting COVID-19 by visiting a doctor or pharmacy, large healthcare organizations are sponsoring ad campaigns encouraging people to return to their medical providers. Print ads, TV commercials and social media ads tell people that returning to their doctor for regular checkups, emergencies or diagnostic tests is not only important, but safe due to strict cleaning routines and office protocols that eliminate shared waiting areas. Providers and payers fear that leaving conditions untreated will result in more serious and costly medical concerns in the future.
In 2017, according to the Centers for Medicare and Medicaid Services, healthcare spending for every man, woman and child in the U.S. totaled nearly $11,000 – more than any other wealthy country. The interesting thing is that very few of us really know what goes into this number or who pays the bills. Here are a few facts you may find interesting.
- The average cost of employer-based health insurance for a family in 2019 was $19,616.
- The Census Bureau reports that 91.5% of Americans have health insurance coverage.
- In 2017, the average ER visit cost about $1,400 – an increase of 176% in 10 years.
- Federal, state and local governments currently pay for about 45% of all healthcare services.
- From 2000 to 2016, spending on prescription drugs rose by 69% – more than any other component.
- The Kaiser Family Foundation reports that in the past year, 50% of Americans put off needed healthcare because of cost.
In a recent decision by the U.S. District Court for the District of Columbia, the AHA lost its bid to avoid having to disclose rates hospitals negotiate with insurers. While an appeal is expected, this is a win for the administration, which is committed to providing patients with understandable information about the cost of medical services.
The rule approved last year required hospitals to post a list of standard charges and rates they charge for diagnostic-related groups (DRGs). These charges were, however, posted as “chargemaster rates” – a format that meant little to the general public. By requiring that hospitals post median prices negotiated with commercial health insurers, CMS believes that providers will be forced to compete on price and that consumers will be better able to make informed choices.
In other developments, the Trump administration was stopped from requiring that drug companies disclose prices in their TV commercials. The President also brokered an agreement with drug companies and insurers to limit Medicare recipients’ copays on insulin to $35 a month. This will go into effect in 2021.
Inflation-adjusted limits for contributions to health savings accounts and high deductible health plans for the coming year were just announced. According to the announcement, eligible individuals with self-only HDHP coverage will be able to contribute $3,600 to their HSA in 2021, an increase of $50 from 2020. Those with family coverage will be able to contribute $7,200 in 2021 and those who are 55 years of age or older will be able to make an additional “catch-up” contribution of $1,000 to their HSA.
While minimum deductibles for HDHPs will remain the same for 2021 plan years at $1,400 for self-only coverage and $2,800 for family coverage, the maximum limits for out-of-pocket expenses will increase to $7,000 for individual coverage and $14,000 for family coverage.
With nearly 40 million workers laid off or furloughed as a result of the Coronavirus, many organizations have urged Congress to expand COBRA coverage. Most of their concerns are focused on encouraging Congress to subsidize COBRA premiums for these workers so that existing health conditions will not get worse because care is delayed.
To date, the Department of Labor and the IRS have extended the time period workers have to decide to enroll in COBRA. With the President’s order setting the end of the national emergency for COVID-19 at June 29th, individuals would have until August 28th to enroll in COBRA. DOL and IRS have also given workers 30 days beyond the end of the national emergency to pay their COBRA premiums for March, April, May and June. Should the Administration decide to extend the national emergency, these timelines would be adjusted accordingly.
There is little doubt that the COVID-19 pandemic has taken a toll on the mental well-being of many Americans. In addition to dealing with fear of the virus and social isolation, economic pressures have continued to grow. Many who have continued to work have been forced to balance working remotely with caring for children who would normally be in school.
A survey by telemedicine giant Teladoc recently showed that nearly half of American workers say their mental health has been negatively impacted. The more disturbing statistic is that only 27% say their employers are taking steps to provide help.
What Others are Doing
While larger employers have long made employee assistance programs available to those in need, the expansion of telemedicine has enabled employers of all sizes to provide access to behavioral health professionals. These appointments traditionally were held by phone, but many are now conducted by video using computers or smart phones.
As the pandemic has continued, onsite employers’ clinics have shown a significant increase in mental health and stress-related cases. Some health systems have placed mental health providers inside workplaces to provide quicker access to treatment. For more information or to strengthen your health plan in this critical area, contact your account representative today. systems have placed mental health providers inside workplaces to provide quicker access to treatment. For more information or to strengthen your health plan in this critical area, contact your account representative today.
America’s Health Insurance Plans, a national trade association whose member companies provide insurance coverage and health-related services to consumers and businesses, has released a study revealing the breakdown of today’s healthcare premium dollar, as follows:
- 23.3 cents of every premium dollar is used for prescription drugs
- 22.2 cents cover the cost of physician services
- 20.2 cents are used to pay for office and clinic visits
- 16.1 cents are used to cover hospital stays
- 13.5 cents are applied to care management, administrative expenses, business expenses, provider management and other fees
- 4.7 cents of every dollar go to taxes, and…
AHIP reports that on average, 2.3 cents of every premium dollar make it to the bottom line as net profit.
Ask an independent TPA what sets their business apart and you’ll likely hear something about customer service and a promise to always put their client’s health plan and its members first. Seldom have these qualities been more meaningful than during the uncertainty of the past few months.
Fortunately, self-funding provides the flexibility employers have needed throughout this crisis. By collaborating with broker partners and other colleagues, TPAs have worked to make plan design changes that lower costs while exploring ways to keep coverage in force for as many employees as possible. Unfortunately, most have been involved in the difficult decisions employers have had to make in order to sustain quarantines, stay-at-home orders and extended closures. Their team members have worked tirelessly to help members access non-emergency medical care while avoiding the risks related to the coronavirus.
In addition to addressing health benefit concerns, TPAs have demonstrated great empathy in encounters with employers, members and providers. While the majority of self-funded health plans offer a telehealth benefit, some groups have been slow to engage with this service. With many organizations working remotely during the pandemic, however, the number of virtual visits has increased significantly.
TPAs have helped many patients avoid visits to the ER by directing them to alternative care settings. Some in need of treatment for chronic illnesses have been directed to high-quality, lower-cost providers rather than traditional facilities and, in some cases, treatment has been administered in the home. Searching for solutions takes a tremendous amount of time and coordination but being an advocate for members is nothing new for TPAs.
Health benefits are complicated for everyone. In times of disruption, plan sponsors and members need every possible tool at their disposal. Self-funding offers manyvaluable tools. When backed by expert administration and open communication, these tools can help health plans build trust and take great care of employees.