The COVID-19 pandemic has had an unprecedented impact across the globe, costing lives, disrupting business and education and creating significant financial losses.
In healthcare, U.S. payers are discovering that the costs of the pandemic may climb into the hundreds of billions of dollars. A recent report from Wakely Consulting (PDF) indicates that the cost of the pandemic could rise to $556 billion over two years. While the exact implications of the pandemic remain to be seen, U.S. health plans are wise to shore up their coffers as the true costs of the pandemic continue to rise.
For Medicare Advantage (MA) plans specifically, protecting and restoring premium revenue are critically important first steps.
Rising healthcare costs in the COVID-19 era
The costs of the pandemic can be measured in many ways. As stay-at-home orders extend to nearly all states, the way we interact with the healthcare ecosystem has changed. Telehealth is playing an expanding role while elective procedures and follow-up visits are being delayed, if not entirely eliminated. This creates a different dynamic between members and their health plans and between health plans and their network providers
Many large health plans have eliminated cost-sharing for COVID-19 testing, putting a strain on plans that look to support members while increasing testing rates. Adopting new guidance for COVID-19 coding and diagnoses may result in billing and claims processing errors. New areas of financial risk stem from plans transitioning to a remote environment where productivity might lessen, systems could be inaccessible and operations can be difficult to monitor.
As all health plans look to offset growing COVID-19 costs, MA plans face a unique and dangerous trifecta. Representing 24.4 million seniors and people with disabilities, these plans expect enrollment to grow to an all-time high, while also expecting a tidal wave of hospitalizations and morbidity.
This is on top of a harmful preexisting condition that MA plans suffer from: a deficit in the millions of dollars in underpaid premiums due to inconsistent or inaccurate data from the Centers for Medicare & Medicaid Services (CMS).
It’s in this last area where MA plans can take action.
Protecting and restoring premium revenue
An important factor in ensuring a stable financial picture during the pandemic is making sure MA plans receive the revenue they deserve. The challenge lies in the fact that ongoing inaccuracies and difficulties with eligibility data result in many MA plans receiving fewer premium dollars than they’re owed.
A comprehensive, long-term premium restoration strategy can help these plans identify and correct data for members with Medicare secondary payer status and end-stage renal disease. Retrospective reviews can uncover dollars owed from the past seven years, and ongoing monitoring can ensure proper premium payments today and into the future.
Premium restoration starts with data
Identifying members with the greatest propensity for premium restoration starts with data. By integrating eligibility data, other health information and CMS data files, the plan can uncover discrepancies in MSP and ESRD statuses.
The right algorithms and logic help identify other health insurance and prioritize member records for validation.
Through data, the plan can determine which records to review and make corrections to inaccurate CMS eligibility information. Data analytics play a key role in determining membership gaps to target for these characteristics.
Holistic approach to premium restoration
Ensuring accurate premium payments requires the right people, processes and technology. Subject matter expertise must guide the process and address everything from managing data and interfacing with CMS to generating reports that enable smart management decisions.
From a process perspective, plans need a consistent, repeatable way to recover premiums. Whether they work with a vendor or manage the process on their own, effective premium restoration requires a comprehensive, systematic approach with all parties focused on common goals.
Technology is critical to achieving the goals of a premium restoration strategy. A thoughtful application of technology will support complete case management production and throughput. A case management system can reduce manual efforts that involve multiple spreadsheets and email conversations to better guide activities, prioritize records, and maintain oversight into stated objectives.
Altogether, an effective premium restoration strategy, expertise in capturing underpaid premiums, and an innovative mix of technology resources can have a significant impact on a plan’s bottom line—during the pandemic and beyond.
Jeffrey Martin is vice president of eligibility operations for Discovery Health Partners.