Developing an Action Plan to Develop Long-Term Strategies to Healthcare Post COVID-19

Establishing rolling budget forecasting, following trends of a permanently changed healthcare landscape, and anticipating modified patient behavior outcomes will help CFOs, HR professionals and business owners plan for the coronavirus aftermath.

Even after the curve has flattened and lives in our communities begin to normalize, the lingering effects of COVID-19 will manifest into staffing and workplace adjustments, medical cost containment strategies and financial challenges for organizations. The impact of this pandemic will persist for the rest of 2020 and will continue to be felt much longer. No one is certain of what’s to come, but it’s abundantly clear that business leaders are grasping for direction on how to take an active approach to control business and healthcare costs so that they can protect their bottom line.

Below are some predictions of what employers can expect for the remainder of 2020, along with insights and strategies of how to prepare:

Elective Surgery Ramp Up Beginning in Q3

Hospitals suffered double-digit percentage revenue declines beginning in March as the coronavirus impact began. Revenue losses have been driven by significant reductions in patient volumes stemming from canceled elective surgeries, a profitable component of healthcare systems. In April, the Centers for Medicare & Medicaid Services (CMS) delivered nearly $34 billion to the healthcare providers through the expansion of the Accelerated and Advance Payment Program to aid providers and suppliers with resources needed to combat the pandemic. As we start to see state and national virus cases plateau and decline, we can expect elective procedures and appointments to return this summer and into fall. This will vary and depend on the provider and patient comfort levels and the organization’s ability to take on capacity and meeting new CDC guidelines. Some patients may be more hesitant to reschedule appointments even though many health systems have launched outreach campaigns that encourage scheduling preventive screenings and annual physicals.

Toward the end of 2020, the frequency will begin to approach pre-pandemic levels. However, recent actuarial models predict a fair amount of “slippage” where certain elective surgeries will be further deferred or eliminated altogether.

Employers, especially those running self-funded health plans, need to right-size budgets for the temporary reduction in services as a result of the national shutdown. In addition, longer-term planning should include health intelligence analytics to evaluate the risk of members with chronic health conditions that were either less compliant or non-compliant with their treatment regimens during the pandemic due to fear of accessing the health system. Normally manageable health conditions can quickly manifest into more urgent and invasive care that is much more costly to health plans.

Potential Q3, Q4 Business Disruption

The stress on the healthcare system in recent months will have collateral impact on non-COVID related staffing logistics. In areas that continue to require stringent social distancing, providers are postponing visits or other forms of treatments such as postponed physical therapy treatments, palliative dental care and delaying an injured worker's recovery and return to work. Return to work assessments may also have additional waiting periods as physicians cannot hold in-person examinations. An increase in insurance benefit costs and disability benefit durations for the weeks that treatment or tests are delayed should be expected.

As we enter the summer months, limitations and closures of camps, childcare and organized youth activities can strain the schedules of working parents to juggle childcare issues when returning to the workplace or balancing remote work. Employers should be aware of the higher potential for prolonged absence requests, job sharing, or modified work schedules and adjust staffing requirements accordingly.

Change of the healthcare landscape

A by-product of the COVID pandemic is sure to include the permanent re-shaping of the healthcare landscape and several facets of the delivery system. Telemedicine and virtual second opinion services are not novel attempts to leverage technology; however, look for these and other technologies to become more mainstream. Members, doctors and employers have witnessed how viable and valuable technology can be while helping bend the cost curve for health expenses. Equally, employees will be turning to their employers to have a more smartphone-friendly experience for their work-life, as it already exists in their personal lives. Access to health plans, Human Resources and Payroll, time and attendance and even collaborating with team members will certainly need to be optimized for a more technologically accepting workforce.

The months ahead may not be easy, but rest-assured, businesses can weather them by thinking strategically about considerations and solutions now can have long-standing impacts. Leaders need to ensure they have the right tools and partners in place to help drive efficiencies and realize revenue impact.

OneDigital's proprietary and enhanced COVID-19 Health Plan Cost Impact Tool equips organizations with the potential financial impact of COVID-19 on their employee health plans. By using this tool, employers can now further manage business service interruptions and develop an estimated dollar amount associated with delayed claims, procedures and the potential COVID-19 hospital claims.

Click here to request additional information and to take charge of the future business implications of COVID-19.