August 10, 2020
Insurance’s “Embarrassment” is a Provider’s Opportunity
With health insurers posting record profits, now is the time to take a hard look at your managed care strategy
Last week, The New York Times ran an eye-popping report on how major U.S. health insurance companies are profiting from the COVID-19 pandemic.
The article led with, “The nation’s leading health insurers are experiencing an embarrassment of profit,” and goes on to note how Anthem, Humana, UnitedHealth Group and Aetna are each reporting quarterly profits double those of last year.
At a time when all but a handful of healthcare providers have taken huge financial hits to prepare for and respond to the pandemic, health insurers are more financially successful than ever. Payers seeing historic profits while providers struggle? That just doesn’t pass the smell test.
A recent national consumer survey commissioned by Jarrard Inc., found the combined public trust of hospitals, doctors and nurses is close to 90%. Trust for health insurance companies hovers at a bit over 50%.
Clearly, this is an ideal time for all healthcare providers to take a hard look at their managed care strategy. Providers can use the goodwill they have earned as leverage for new agreements with health insurance companies. This will give providers the ability to continue confronting the COVID-19 pandemic and other future health challenges.
Preparing for a payer negotiation should begin now – while the stories are hot – not in three months or a year when contracts are up for renewal. Today’s headlines can benefit your organization tomorrow, but action is required now.
So, as you look at the next 6-18 months, consider:
- Payer contracts that are coming up for renewal and could be renegotiated.
- Existing long-term or automatically renewed payer contracts that no longer allow your organization to fulfill its mission.
- Proactive outreach to payers to discuss the ongoing financial burden caused by the pandemic.
After you determine your go-forward managed care strategy, use the power of communication to leverage the goodwill your team of caregivers has earned during the pandemic. Strategic communication with patients, employers, brokers, elected leaders and your employees is essential. As you think about communications, know that:
- Communications should begin months before negotiations become public. Advanced communication will create understanding and build support from brokers, employers and elected leaders. This is vital to putting appropriate pressure on insurance companies.
- Clear and ongoing internal communication is needed for your employees to understand how they can help patients.
- Proactive media outreach will help position your organization as an advocate for patients.
Health insurance companies have long claimed to be controlling costs for patients. That claim won’t hold up as payers collect historically high profits from the pandemic. Now is the time for providers to seize the conversation and make sure health insurance companies are doing their part to support the actual providers of care.