5 Steps Health Insurance CEOs Must Take to Help with COVID-19

By JEFF LIVINGSTON, MD

Imagine a country where you can not see a doctor. Who will refill your blood pressure prescription, see your sick child, mend your broken arm, deliver your baby, or run the ventilator if you fall victim to Coronavirus? The COVID-19 pandemic created a cash-flow crisis causing mass physician layoffs and closure of medical practices. A world without doctors puts us all at risk. The pandemic is the invisible enemy, and the CEOs of large insurance companies have the tools to help doctors stay in the fight.

Our government, healthcare providers, and individuals are doing our part to flatten the curve of the pandemic. It is time for the insurance industry to take massive action to salvage the US health system.

Practices are closing already. Tenet Health care announced a $250 million dollar reduction effective March 27, 2020. Other large and small health systems are implementing drastic cost-cutting measures. Data reported in USA Today, an estimated 60,000 family practices will close and 800,000 of their employees will lose their jobs by the end of June.  

On a personal note, I have been wearing my glasses for two weeks as I can not get my contacts refilled. My trusted eye doctor has already shut the doors and cannot refill my prescription. 

Which CEO will lead the way?

In times of crisis, leaders lead. They rise to the occasion and accept the challenge. Leaders take bold steps to overcome obstacles. Americans wait to see which large private insurance company CEO will appear on Bloomberg or CNBC announcing proactive, life-saving initiatives to help our country and our healthcare system. 

Our forward-thinking potential champions are UnitedHealth Group CEO David Wichmann, Cigna CEO David Cordani, Humana CEO Bruce Dale Broussard, Anthem CEO Gail K. Boudreaux, and BCBS CEO Scott Serota.

Only one of these leaders gets to be the hero. 

One leader gets a “first-mover” advantage. They set the stage and light the path for other CEOs to follow. Americans will read only one of the names in every news headline, and only one will be the subject of a Harvard Business Review case study. 

Only one leader will be celebrated on Twitter and praised on Facebook. Only one CEO’s face will grace the front page of the Wallstreet Journal. Their company will be rated “BUY! BUY! Buy!” by Jim Cramer on Squawk on the Street. The others will be forgotten, failed leaders who placed profits before patients. Who will be first, and who will follow?

The question is, “which CEO of a large private insurance company is ready to take the bold, strong steps to lead America through this crisis?”

Now is the time for CEO action 

The United States needs immediate coordinated action to prevent a complete collapse of our health system. Private insurance companies must act before the hammer of government intervention wakes them from their slumber. Without prompt and effective solutions, Without prompt and effective solutions, the industry should expect a crushing blow of governmental regulation. Slow movers will not be rewarded.

Failing medical practices have a trickle-down effect. As the pandemic ravages our economy, unemployment rises to all-time highs. Patients lose their health insurance. The drop in monthly premiums leads to plummeting revenue. Combine the incoming barrage of astronomically expensive COVID-19 care claims with the loss of revenue from decreased subscribers, and insurance companies will find themselves in the same cash-flow crisis as doctors. 

The insurance industry cares about the health of the nation, but they also have an economic incentive to keep doctors in business. To keep it simple, when doctors fail, so will the insurance companies.

The negative cascade will continue as the US uninsured population skyrockets. Patients’ only options will be taxpayer-funded Medicaid and public health options.

The domino effect triggered by a sudden shortage of healthcare workers will impact the sustainability of the private health insurance industry. A lack of action triggers an accidental move towards a single-payer system. 

If we go down, so do the insurance companies.

Health insurance industry CEOS control their fate

CEOs face a choice that will determine our country’s path. These two options should haunt their thoughts and keep each CEO awake at night as this pandemic requires big, bold action.

Option number 1: Let medical practices fail and allow the government to solve the problem. 

Option number 2: Offer market-based private industry solutions. Solve the problem, or it will be solved for you. 

Without urgent and decisive action, the collapse of our current system moves the US one step closer to a government takeover of healthcare. The irony is thick. To save the private health industry, health insurance companies must make short term financial sacrifices to prevent a collapse of the system. 

The solution to relieve the cash-flow crisis burden lies squarely on the shoulders of private insurance companies. The industry has taken some positive steps. We must give credit where credit is due. Many companies waived cost-sharing for COVID-19 care. While beneficial, it is a drop in an empty bucket. This step received media praise, but it is not sufficient to solve the crisis. 

Many suggest the burden is on doctors to renegotiate their insurance contracts. It is not practical for every practice in the country to negotiate terms with each third party payer individually. Our practice has contracts with over one hundred third-party payers. Individualized contract negotiations is not a scalable solution.

Others suggest the federal government must offer solutions. The passage of the CARES act was an excellent first step. Other congressional actions will follow. CMS, which governs the federally-funded Medicare program, expanded a widely popular Accelerated Advanced payment system. State governments manage Medicaid rules. We do not have time to wait for all 50 states to agree upon 50 different solutions. 

The only path to keeping medical practices solvent way at the required speed is action by the CEOs of large insurance companies. 

Here are five actionable initiatives a health insurance company can implement immediately to help the US health system navigate through the pandemic.

1. Replicate the Accelerated Advanced payment system

To increase cash flow to providers impacted by the Coronavirus pandemic, CMS allows providers to request up to 100% of the Medicare payment amount for a three-month period. Private third-party payers can replicate this process for all providers throughout the country. This one step triggers a cash infusion allowing doctors to keep the doors open and will enable us to serve those in need. 

2. Suspend out-of-network penalties.

It is unsafe to enforce network restrictions during the pandemic. Insurance companies must allow physicians and patients to seek care in hospitals and medical sites of service not experiencing capacity limitations. Doctors need the freedom to direct care where it is safe and where there is room. Trust your contracted providers to guide patients to the safest option available in their local community. 

Insurance companies must recognize the immediacy of this decision to reduce the burden on hospital capacity. Every CEO should consider what they would want for their family and loved ones. 

Would they want to be admitted to an in-network facility known to be at capacity or an out-of-network facility with plenty of open rooms?

Failure to remove network restrictions will cost lives and bankrupt any family factoring finances over safety.

3. Expedited health care provider credentialing process. 

Allow immediate authorization of any licensed provider, in good standing with their state’s medical board, to provide all services on your medical plans. The credentialing process takes 90–120 days. The harsh reality is there is no time for bureaucratic red tape as physicians get sick and die. 

CEOs of every insurance plan should announce an expedited credentialing process. Patients and doctors across the country will take note of the first CEO to take this simple step to keep patients alive.

4. Expedited revenue cycle management 

Medical billing systems (revenue cycle management) create a lag in payment for services rendered. Payments are often not received for up to three months. Reduce the need for layers of record requests, denials, and appeals. Continue oversight for fraud, waste, and abuse, but reduce the barriers to payment. Each lag in payment exacerbates the cash flow crunch for medical practices.

5. Telehealth reimbursement parity 

CMS removed restrictions to allow expansion of virtual care through Waiver 1135. Many offices rapidly expanded their services to implement Telehealth. Reimbursement varies for each third-party payer. Each payer has different guidelines and various payment models for audio vs video consults. The Texas Medical Association published a summary of current guidelines that illustrate the chaos of virtual care reimbursements. No practice can possibly implement Telehealth effectively fat scale following this system.

Keep it simple.

Reimburse any form of virtual care on par with previously established CPT codes for in-person visits during the COVID-19 crisis.

Courage is needed now 

We are counting on the health insurance industry to join providers in the fight against COVID-19 as it crushes every practice, hospital, health system in every specialty in our country. Medical practices across the country need help to stay in business. The United States passed 331,151 COVID-19 cases today. When this article is published, that number will be higher.

The death toll will continue to rise. 

America needs every available doctor in the country to fight the challenges of COVID-19. Health insurance companies can provide the lifeline allowing providers to stay in the battle. 

Time is running out. 

Which health insurance CEO will take the bold action needed to save the US health system?

Thank you to Michael Mcewen from Mcewen and Associates for providing background for this article. 

Jeff Livingston, MD is an OBGYN practicing in Texas.

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