How Might the Pandemic Affect Health Premiums, Utilization, and - PowerPoint PPT Presentation

How Might the Pandemic Affect Health Premiums, Utilization, and Outcomes in 2021 and Beyond? October 19, 2020

Agenda Introduction • Cynthia Cox, vice president and director of the Program on the ACA, KFF Presentations • Krutika Amin, associate director for the Program on the ACA, KFF • Nisha Kurani, senior policy analyst for the Program on the ACA, KFF • Luke Greenwalt, vice president, Market Access Center of Excellence, IQVIA • Michael Kleinrock, research director, Institute for Human Data Science, IQVIA • Christopher Mast, Clinical Informatics, Epic • Nichole Quick, Clinical Informatics, Epic Audience Q&A Closing Remarks • Jay Want, executive director, Peterson Center on Healthcare

Uncertainty Due to COVID-19 Affects Various Drivers of Future Health Insurance Enrollment, Premiums, and Claims Costs Epidemiology • $20-$850/test? Testing • Costs to plans and overall system? Vaccines Vaccine/ testing Science and Medicine development Hospitalization/ • Est. $10,000 - $90,000 for pneumonia hospitalization; rest? Treatment Severity and disease management Changes in • Telehealth? Utilization Private individuals’ and Delayed/ • Pent-up demand/ backlog/ more companies’ behaviors Foregone Care complications later? Public Health and Policy Response Coverage Public institutions • Churn between markets? Changes (local, state, federal) Sources: Peterson-KFF Briefs Available at: https://www.healthsystemtracker.org/brief/how-health-costs-might-change-with-covid-19/, https://www.healthsystemtracker.org/brief/covid-19-test-prices-and-payment-policy/

Policy changes are moving targets What has already happened? What is unknown for 2021+? • Expansion of services provided over • Patient cost sharing for telehealth testing/treatment • Federal policies on telehealth services • Premium stabilization options ‒ Medicare ‒ Reinsurance ‒ Individual/small group markets ‒ Risk corridors • Insurers’ MLR and premium holidays • California v. Texas SCOTUS case • Legislative actions on testing/ coverage • Election Sources: Cost-Sharing Waivers and Premium Relief by Private Plans in Response to COVID-19. https://www.kff.org/health-costs/issue-brief/cost-sharing- waivers-and-premium-relief-by-private-plans-in-response-to-covid-19/ Explaining California v. Texas: A Guide to the Case Challenging the ACA. https://www.kff.org/health-reform/issue-brief/explaining-california-v-texas-a- guide-to-the-case-challenging-the-aca/

2021 Premium Changes in the ACA Marketplace • Modest increase in overall rates: 1.1% (median) • So far in 2020, insurers have remained profitable and loss ratios have been low Overall Rate Change and COVID-19 Load Among ACA Marketplace Plans Overall Rate Increase Impact of COVID-19 on Rates (among insurers with unredacted justifications) 25 th Percentile -3.5% 0.0% Median 1.1% 0.0% 75 th Percentile 4.6% 2.0% Sources: 2021 Premium Changes on ACA Exchanges and the Impact of COVID-19 on Rates. https://www.kff.org/private-insurance/issue-brief/2021-premium- changes-on-aca-exchanges-and-the-impact-of-covid-19-on-rates/

Impact of COVID-19 on Premiums “Given the level uncertainty and range of plausible outcomes, we are not including an explicit factor for the impact of COVID-19 on our 2021 premium rate development at this time.” - Insurer on Ohio Marketplace • General uncertainty around impact of COVID-19 on rates • 23 of the 63 filings (37%) specified the impact of COVID-19 on premiums, including: – COVID-19 testing and treatment costs – Vaccination costs; e.g., $75/dose, with 80% of population receiving a dose – Demand for services deferred in 2020 – Morbidity adjustments Sources: 2021 Premium Changes on ACA Exchanges and the Impact of COVID-19 on Rates. https://www.kff.org/private-insurance/issue-brief/2021-premium- changes-on-aca-exchanges-and-the-impact-of-covid-19-on-rates/

Although trending in the right direction, 11M continuing unemployment claims reflects a challenged economy and potential shifts in health insurance enrollment Continuing unemployment is a precursor to shifts in health insurance enrollment, structural unemployment is not always readily apparent Weekly Jobless Claims and Continuing Unemployment 13.3% 14.7% 11.1% 10.2% 24.9 25M 8.4% 22.5 7.9% 22.4 20.8 21.3 20.6 20.3 20M 19.2 18.8 18.0 18.1 17.8 17.3 16.2 17.0 16.1 15.5 15.8 14.8 15M 4.5% 13.3 13.1 12.8 12.4 11.9 12.0 11.0 10M 3.5% 7.4 6.9 6.6 5.2 4.4 5M 3.9 3.3 3.2 3.1 2.7 2.4 2.1 1.9 1.8 1.7 1.7 1.7 1.7 1.7 1.7 1.6 1.5 1.5 1.4 1.4 1.4 1.4 1.3 1.2 1.1 1.0 1.0 0.9 0.9 0.9 0.9 0.8 0.2 0.2 0.3 0.2 0.2 0.2 0.2 0M 1- 8- 15- 22- 29- 7- 14- 21- 28- 4- 11- 18- 25- 2- 9- 16- 23- 30- 6- 13- 20- 27- 4- 11- 18- 25- 1- 8- 15- 22- 29- 5- 12- 19- 26- Feb Feb Feb Feb Feb Mar Mar Mar Mar Apr Apr Apr Apr May May May May May Jun Jun Jun Jun Jul Jul Jul Jul Aug Aug Aug Aug Aug Sep Sep Sep Sep Initial Jobless Claims Continuing Unemployment Source: Bureau of Labor Statistics Jobless Claims data through 9/26/2020 6

Historically, Medicaid enrollment has been sticky despite the economic expansion over the last decade Unemployment and Enrollment Growth Trend (based on monthly average) Medicaid Enrollment* Unemployment 74,633,849 72,701,268 48,590,074 42,491,262 31,689,061 17,750,000 14,265,000 8,149,000 6,210,000 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 June 2020 Recession Recession ACA Expansion 7

Consumers shifting payer channels is beginning to occur with increases in Medicaid enrollment – importantly more people show no Rx activity in 2020 Patients are 3x as likely to switch to Medicaid in ACA expansion states than non-expansion Rx Coverage Comparison Pre/Post COVID Inactive Commercial Patients Maintain Coverage Switch Coverage Cash/Discount Medicaid Medicare HIX Other 30% +19% 7.6% 4.50% 4.00% 25.0% 25% 17.0% 17.90% +28% 21.0% 19.5% 8.0% 20% 23.1% 15.2% 15% 92.4% 10% 64.9% 51.0% 5% 0% Q2 Q3 2019 2020 Patients w/ Comm. MOP Expansion States Non-Expansion States 8

Medical claims have rebounded to a steady 80% of pre-COVID baseline with 8-10% from strongly adopted telehealth Total Visit Claims by Service Type Year over Year Growth – Elective Procedu4e Across Time Aligned Weeks Baseline Period – W/E 9/11 120% Sep Jan May 1% 100% 80% 8% 69% 60% 50% 40% 20% 30% 19% 0% Baseline 03-13 03-27 04-10 04-24 05-08 05-22 06-05 06-19 07-03 07-17 07-31 08-14 08-28 09-11 INSTITUTIONAL OFFICE TELEHEALTH Data for latest week date controlled against prior periods; estimates have been applied to reflect anticipated late-adjudicated claims based on historical rates Source: IQVIA: Medical Claims Data Analysis, 2020; Baseline = Average of claims for period W/E 1/10/2020-2/28/2020, Estimated amounts for latest weeks applied based on likely claims still to be received due to data latency or claim processing delays; See Appendix for further details 9

Pediatric and adult vaccinations were severely impacted early in COVID but have returned to more normal levels; Flu vaccinations a bright spot in 2020 Weekly Volume Unit Clinic Sales for Selected Flu Vaccinations by week in 2020 Weekly Volume Unit Clinic Sales for Selected Pediatric Vaccines* Through W/E 9/25 Adult Vaccines* Through W/E 9/25 compared to equivalent week in 2019 Dispensed Prescriptions for Flu Vaccine Millions 6.0 300,000 600,000 2020 5.0 2019 250,000 500,000 Aug 7-Oct02 4.0 2020: 23.5mn 400,000 200,000 3.0 300,000 150,000 2.0 200,000 100,000 1.0 100,000 50,000 2019: 12.6mn 0.0 19-Jun 3-Jul 17-Jul 31-Jul 14-Aug 28-Aug 11-Sep 25-Sep 9-Oct 23-Oct 6-Nov 20-Nov 4-Dec 18-Dec - - 2/7 2/21 3/6 3/20 4/3 4/17 5/1 5/15 5/29 6/12 6/26 7/10 7/24 8/7 8/21 9/4 9/18 2/7 2/21 3/6 3/20 4/3 4/17 5/1 5/15 5/29 6/12 6/26 7/10 7/24 8/7 8/21 9/4 9/18 Week Number Source: IQVIA Weekly Sales Perspectives (WSP), February – June 2020; Note: Data reflects sales to clinic channel as defined by IQVIA – No methodology has been applied to determine VACCINE USE BY AGE; Source: IQVIA NPA Weekly, Week ending Oct 02, 2020 10

Delayed Cancer Screenings

Pediatric Immunizations Drop in the Wake of COVID-19

Trends in Overall and Non-COVID- 19 Hospital Admissions

COVID-19 Racial Disparities in Testing, Infection, Hospitalization, and Death: Analysis of Epic Patient Data

Contact Information and Additional Resources Ashley Joyce Communications Associate, DC Email: ajoyce@kff.org Phone: (202) 654-1348 An archived version of the webinar will be posted online later today. We will notify attendees by email when it is available. For the latest information and analysis of trends, drivers and issues that impact the performance of the U.S. system, visit the Peterson-KFF Health System Tracker: healthsystemtracker.org