Managing COVID-19’s Unexpected Consequences for Healthcare Benefits

    Tom Belmont Jr.

    Emerging data underscores the relationship between the pandemic’s prolonged disruption of daily life and its profound impact on mental and physical health. Employees have endured an overload of change and employers are sensing a stark increase in stress and burnout. In fact, 44% believe the situation has worsened since the pandemic began.

    Patterns of healthcare consumption have also been drastically altered by the pandemic. Over the past 12 months, more employees have received counseling and substance abuse treatments, driven by a sharp rise in stress, combined with healthcare providers’ ability to adapt service for easier access. The immediacy and privacy of telemedicine works especially well for mental health counseling and adoption has been strong, thanks to the widespread availability of mobile devices.

    The cost trajectory of change
    Organizations braced themselves for an overall jump in healthcare costs at the outset of the pandemic, due to the anticipated expense of treating COVID cases. Instead, a different financial scenario unfolded, with patients postponing or skipping routine and elective medical services over the course of 2020. For example, delayed dental checkups and treatments resulted in a monthly spend reduction of up to 80%. A decline in elective surgery has also been noted.

    The total net impact on employer healthcare spending is lower costs compared to 2019. And while some of the volume has bounced back as lockdowns have lifted, it hasn’t returned to pre-pandemic levels.

    COVID-19 has caused a modest increase in overall prescription drug spending. The Coronavirus Aid, Relief, and Economic Security (CARES) Act mandated that Medicare plans allow for broad use of 90-day scripts during the state of emergency, up from the standard 30 days for branded medications. As a result, commercial healthcare plans largely followed this change and registered a net increase in per-patient drug utilization.

    Reconciling telemedicine’s pros and potential cons
    The growth of telemedicine is one of the most dramatic changes to healthcare seen during the pandemic. But is this a good or a bad thing?

    Telemedicine visits work very efficiently for situations where the doctor’s physical presence is not essential. Yet there’s a general tendency toward prescribing more medications during a telemedicine session versus an in-person visit. Another concern is the camera’s less discerning eye for evaluating patients, which creates the potential for subtle issues to be missed or misinterpreted, including blood pressure, reflex assessments or other diagnostics.

    While plenty of employers assume telemedicine is a more efficient way for patients to see a medical professional, many debate the cost advantages and the ability of this practice to capture patient information effectively.

    Timing the introduction of health benefit changes
    In 2020, with the world in flux, employers quickly recognized that implementing new and planned health initiatives would only be further complicated by the challenges of measuring their success. Many are now watching and waiting for the optimal time to introduce change. But because the pandemic is truly an unprecedented event, most will likely sideline almost all new initiatives until they regain their faith in an adequate level of stability.

    Applying social factors to support employee needs more precisely
    Companies are more actively engaged in managing their populations’ health by leveraging data that falls outside of traditional healthcare tracking. Understanding various lifestyle and behavioral traits enables employers to offer targeted resources that address an employee’s specific health risks.

    The lingering uncertainties of the pandemic have escalated the importance of finding efficiencies when investing in employee health. New and flexible options are part of a successful transition, and socially appropriate benefits that more closely and broadly match individual needs show exciting promise.

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