Analysts at Moody’s Investors Service believe that the COVID-19 pandemic will have a significant impact on the future of the health insurance industry.
The report explains that Moody’s-rated health insurers will need to adapt to certain changes in the next three to five years as it will be an important driver of credit strength.
The healthcare trends that insurers will most likely be affected by include the ongoing focus of the high cost of treating patients with co-morbidities, a term used for people suffering from more than one chronic illness at the same time.
COVID-19 has highlighted the challenge of co-morbidities, a group that is especially vulnerable to the virus, further highlighting the need for proactive management on the part of health insurers.
With the onset of the pandemic, telehealth usage has soared, especially with telephone consultations with a patient’s primary doctor.
Moody’s Vice President Dean Ungar said: “One large health insurer reported 15 million telehealth visits in the first half of 2020 compared with 1 million in all of 2019. Telehealth clearly filled a gap when patient access to in-person care was severely restricted as well as bringing healthcare access to rural areas.”
Telehealth can become a useful tool when treating mental and behavioural health conditions as it can serve as an early warning system, which leads to health insurers becoming aware of patient conditions that might otherwise have remained undetected.
The health insurance industry has been shifting from the traditional fee-for-service reimbursement model to providers to a value-based care model.
Some providers were reluctant to fully adopt the value-care model due to risk, but doctors in value-based care arrangements have experienced a much more stable flow of income during the lockdowns. The COVID-19 pandemic should help accelerate the trend to value-based care.
