Health Plan Weekly

✦ UnitedHealthcare will expand its presence on the Affordable Care Act exchanges by offering plans in at least one additional state in 2021. Maryland Gov. Larry Hogan (R) said on May 12 that the insurer will join two other carriers — CareFirst BlueCross BlueShield and Kaiser Permanente — in offering coverage through the state’s individual marketplace. As of 2020, UnitedHealthcare offers exchange plans in parts of Massachusetts, Nevada and New York, but back in 2016 it participated in 34 states, Credit Suisse analyst A.J. Rice pointed out in a May 12 note to investors. In response to a query from AIS Health regarding whether UnitedHealthcare will sell plans in any more state exchanges in 2021, a spokesperson said it is “premature for us to provide any further details.” However, he added that “we intend to offer exchange plans in those states where we can provide an efficient network and competitive product capable of driving sustainable value for consumers and our state and federal partners.” Read Hogan’s press release at https://bit.ly/2T4NstH.

✦ In sharp contrast to the nearly $3.2 billion in net income it reported in the first quarter of 2019, Kaiser Permanente posted a $1.1 billion net loss for the same period in 2020, Modern Healthcare reported. Still, the integrated health system didn’t see a revenue decrease when elective and non-emergency care was put on hold, since its model requires membership fees to be paid at the beginning of each month and California’s stay-at-home order was put into place on March 19. Kaiser’s revenue grew 5.9% in the quarter to $22.6 billion, and its expenses grew by 7.8% to $21.4 billion — a result that executives attributed to an intentional focus on keeping memberships affordable. Read more at https://bit.ly/2xZzim6.

Credit ratings firm S&P Global Ratings Inc. is mildly confident about the financial health of the health care industry. On May 13, S&P analysts gave health insurance companies a stable outlook, and graded payer debt with an A rating. Meanwhile, for-profit and not-for-profit providers both received negative outlooks.

S&P has not downgraded any health insurance firms this year. Those ratings are in line with a consensus across Wall Street that sees health insurance firms as a safe investment bet despite the COVID-19 pandemic and economic crisis. Publicly traded payers’ first-quarter earnings were all in line with their pre-COVID-19 guidance, and many firms exceeded their projected first-quarter results (HPW 5/4/20, p. 1).

Employers are aiming to enhance certain health care benefits — particularly virtual mental health care and wellness solutions — as they look for innovative ways to support their workers during the COVID-19 pandemic, a recent Willis Towers Watson (WTW) survey found.

The survey, conducted in late April to examine the business impact of the coronavirus pandemic, reports that more than three in four employers are offering or expanding access to virtual mental health services. Others say they want to address work-from-home challenges, such as employee loneliness and caregiving needs.

The COVID-19 pandemic is proving especially challenging for the primary care business, but as a result of the crisis, the head of one primary care trade group says her membership is open to working with insurers to leave behind fee-for-service, visit-based billing and enter value-based payment agreements.

However, that requires the survival of primary care practice groups. According to primary care provider trade group Primary Care Collaborative (PCC), an April 24 survey of its membership found that eight in 10 responding PCPs were in “severe” or “close to severe” financial trouble because of COVID-19.