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Payer Experiences with COVID-19

Summary

New Avalere research featuring payer views of COVID-19 finds a heightened concern about the clinical effectiveness of related future vaccines and therapeutics, a substantial reduction in preventive services due to the COVID-19 public health emergency, and a significant uptick in telehealth adoption.

In early September 2020, Avalere conducted an online survey of 40 payers, including 39 US health plans and 1 PBM, representing roughly 48 million covered lives. Participants reflect the payer landscape in membership, type, and geo-distribution.

This survey considers key areas regarding COVID-19:

  • Payer considerations for vaccines and therapeutics
  • The pandemic’s impact on care delivery
  • Short- and long-term impacts on telehealth

Payer Perspectives on Future COVID-19 Vaccines and Therapeutics

For nearly half of the payers surveyed, clinical effectiveness was the chief concern regarding future COVID-19 vaccines and therapeutics. The remaining half was broadly divided, citing issues with cost, patient access, and distribution (Figure 1).

Figure 1. Top Payer Concerns for COVID-19 Vaccines & Therapeutics
Figure 1. Top Payer Concerns for COVID-19 Vaccines & Therapeutics

Seventy-eight percent of payers expect to begin reimbursing for COVID-19 vaccines within 4 months of Food & Drug Administration (FDA) approval or Emergency Use Authorization (EUA) (Figure 2). Although the Coronavirus Aid, Relief, and Economic Security Act requires commercial insurers and employer-sponsored plans to cover a COVID-19 vaccine with 15 days of an Advisory Committee on Immunization Practices recommendation, providers will not need to be reimbursed for US government-purchased doses. Reimbursement for administration fees are still being finalized. Medicare set the rate at $28.39 for administering single-dose vaccines. For vaccines requiring a series of 2 or more doses, the initial dose(s) will be reimbursed at $16.94, and the final dose in the series will be reimbursed at $28.39. The reimbursement rates for private insurers and Medicaid are still unclear.

Figure 2. Payer Expectations of Vaccine Reimbursement Timeline Following FDA Approval or Authorization
Figure 2. Payer Expectations of Vaccine Reimbursement Timeline Following FDA Approval or Authorization

COVID-19 Impact on Care Delivery

The survey revealed a substantial decrease in preventive care. Over 80% of payers cited decreases in screenings for cancer, hypertension, and diabetes—as well as child and adult immunizations—since the start of the pandemic (Figure 3).

Payers are generally more focused on the short-term economic impacts of COVID-19, including the costs of hospitalizations, vaccines, and therapeutics. For the payers surveyed, deferred or forgone care of patients did not rank among the top concerns.

Figure 3. Percentage of Plans Reporting Reduction in Preventive Services, by Service Type
Figure 3. Percentage of Plans Reporting Reduction in Preventive Services, by Service Type

Changes in Telehealth Utilization

According to a report released by Health and Human Services in August, 44% of Medicare primary care visits were delivered via telehealth in April 2020, compared to 0.1% in February. Consistent with these findings, almost half of survey respondents reported substantial increases in telehealth encounters this year, with 80% of those being audio and video. Eighty-eight percent of payers surveyed plan to increase telehealth investment, integrating it into the 2021 plan year and beyond. Most payers (73%) expect up to 30% of future primary care visits to be conducted via telehealth (Figures 4–5).

As for barriers to long-term telehealth adoption, technology access was the top concern, followed by provider reimbursement. In recent months, state and federal policy makers have worked to further telehealth use with greater access to broadband internet technology. Additionally, all 50 states and DC have expanded telehealth coverage and reimbursement through Section 1135 waivers and executive actions. The Centers for Medicare & Medicaid Services has provided additional telehealth flexibilities in Medicare, waiving cost sharing, allowing mid-year plan changes, and relaxing requirements.

Figure 4. Anticipated Changes in Telehealth Utilization After PHE vs. 2019 (Shown: Payers)
Figure 4. Anticipated Changes in Telehealth Utilization After PHE vs. 2019 (Shown: Payers)
Figure 5. Anticipated Share of Future Primary Care Visits Provided via Telehealth (Shown: Payers)
Figure 5. Anticipated Share of Future Primary Care Visits Provided via Telehealth (Shown: Payers)

In summary, payers are more concerned with short-term pandemic impacts (e.g., COVID-19 hospitalizations and therapeutics) than with the reduction in preventive services utilization. In preparation for a future COVID-19 vaccine, payers’ primary concerns are clinical effectiveness and overall cost. While payers will not need to reimburse providers for government-purchased vaccine doses, questions remain regarding who will cover vaccine administration fees under an EUA. Looking to the future, most payers anticipate long-term adoption of telehealth services.

The research featured in this Insight comes from Avalere Federal Policy 360™.

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