An increasing number of health insurers are supporting healthcare providers during the COVID-19 pandemic by speeding up claims payments or offering loans to bolster their finances, which have been weakened by stay-at-home orders and the deferral of elective procedures.
Highmark, the Pittsburgh-based Blue Cross and Blue Shield insurer, announced this week that it would provide $30 million in advance payments to more than 1,700 local primary care practices participating in its value-based reimbursement program. The payments would normally be made in June but will begin going out this week.
UnitedHealth Group said it would speed up $2 billion in claims payments to medical and behavioral health providers for fully insured commercial, Medicare Advantage and Medicaid members. The company said it would also provide up to $125 million in small-business loans to clinics partnered with its subsidiary OptumHealth.
The CMS ealier this week said it had given out $34 billion in loans to Medicare providers. On Thursday afternoon, it said that figure is now more than $51 billion. "Amid a public health storm of unprecedented fury, these payments are helping providers and suppliers—so critical to defeating this terrible virus—stay afloat," CMS Administrator Seema Verma said.
While hospitals and other healthcare providers in some parts of the country are struggling to meet the demand of a rising number of COVID-19 patients, providers in other places are idle, bracing for a potential surge of coronavirus-stricken patients in their own communities. In the meantime, they've called off nonessential procedures to free up protective gear and other resources.
Patients are canceling routine office visits to comply with orders to practice social distancing, which is meant to stem the spread of the coronavirus that has infected 430,000 and killed nearly 15,000 in the United States. Dwindling patient visits and procedures have sapped providers' revenue, prompting many to furlough workers, cut pay and benefits, or even close their doors temporarily.
The American Hospital Association this month sent letters to the largest health insurers asking them to "support stable cash flow" by offering accelerated payments or periodic interim payments during the pandemic.
On Monday, Blue Shield of California said it would provide up to $200 million in loans and advance payments to cover anticipated healthcare costs. The insurer said it plans to offer favorable repayment terms to help providers over the next six months.
Blue Cross of Idaho in March said it would begin providing advance payments to independent physicians once per month in April, May and June, and would recover the interest-free payments during the fourth quarter of 2020.
At least one other insurer—L.A. Care—has indicated it is mulling providing advance payments or loans, but is waiting to see where more help is needed after Congress' $100 billion relief funds for providers are distributed.
Health insurers initially responded to the pandemic by pledging free coronavirus lab tests to certain plan members. A growing number have since promised to waive cost-sharing for COVID-19 treatment and hospitalizations.
Beyond speeding up reimbursement, insurers say they are helping clinicians by easing prior authorization requirements and removing other administrative burdens. Some are donating funds to address shortages of respirator masks and allowing the licensed clinicians they employ to take paid leave to volunteer for providers in the COVID-19 response.
Health insurers' bottom lines could be squeezed by the pandemic if they end up shouldering the cost of a large number of COVID-19 hospitalizations, but they could also benefit from the postponement of expensive elective procedures, like knee and hip replacements. Industry analysts expect insurers to raise premiums in 2021 to cover any COVID-19 losses from this year.