Minnesota health insurers are passing more COVID care costs onto patients as health plans begin to treat certain pandemic disease-related expenses like those with other conditions.
The move means a growing number of Minnesotans sick with the virus are joining patients across the country in paying for some of their pandemic health care out of pocket.
As of January 1, state not-for-profit insurers require patients covered by individual health plans and some employer-sponsored group plans to make co-pay, deductible, and coinsurance payments when they seek care for COVID-19.
The wide availability of vaccines, which are proven to help people avoid serious illnesses and hospitalizations, has prompted the recent shift, according to health plans.
“COVID vaccinations are a good way for Minnesotans to protect their health, stay out of the hospital, and avoid the potentially large bill,” said the Minnesota Council of Health Plans, a trade group for insurers at nonprofit, in a press release.
These fees were previously waived due to an April 2020 agreement between the state and insurers. These fees are referred to as “cost sharing” by the insurance industry.
The change does not mean the pandemic is over.
Those enrolled in the health plan continue to receive COVID-19 testing without cost sharing. The industry trade group says some people in Medicare and Medicaid health plans will continue to have cost-sharing fees waived for acute COVID-19 treatment and hospitalizations until the emergency ends. public health. And there’s no cost sharing for patients in any plan who receive certain monoclonal antibody treatments that can prevent the worst of the disease.
Even so, the move by Minnesota health plans aligns with the national trend to restore cost sharing in several areas, said Cynthia Cox, vice president of the California-based Kaiser Family Foundation.
“Only a relative handful of insurers were still waiving costs at the end of 2021, so I would be surprised if there are many left who are still waiving these costs now,” Cox said in an email.
“The question of cost sharing during the pandemic raises questions of equity,” she added. “On the one hand, if so many people are at risk of contracting a potentially serious viral infection, is it fair for insurers to impose a deductible on patients? On the other hand, why should a cancer patient pay his frankness if a COVID-19 not the patient?”
The cost-sharing waiver was necessary at the start of the pandemic to remove barriers to treating patients, said Lucas Nesse, chief executive of the Minnesota Council of Health Plans. Now that vaccines are widely available, it makes sense to reinstate co-pays, deductibles and coinsurance fees because they help moderate the cost of monthly premiums, he said.
“The lower the premiums, the more registrations there will be,” Nesse said. “Broader enrollment leads to stable insurance pools and broader access to care.”
Also, by continuing to forgo cost-sharing, insurers might fear creating “moral hazard,” said Sayeh Nikpay, a health economist at the University of Minnesota.
If patients know that health insurers won’t charge them out of pocket for COVID-19 care, Nikpay said, they might be less motivated to get vaccinated.
Although this moral hazard does not apply to everyone, she said.
“There will be people who will continue to get seriously ill when they get COVID, even though they have been fully vaccinated and given a booster because they have underlying comorbid conditions,” Nikpay said in a statement. E-mail. “So this policy is kind of a blunt instrument – some people might be pressured into getting vaccinated, but others will face increased financial risk due to sharing the cost of COVID-related treatment.”
Early in the pandemic, the Kaiser Family Foundation estimated that people with employer coverage who were admitted for COVID-19 treatment in hospitals could routinely face out-of-pocket expenses exceeding $1,300. At the time, insurers had several possible motivations for eliminating that financial risk, Cox said.
Some probably saw it as the right thing to do, she said, while others saw that some excess profits at the time should be returned to consumers in the form of rebates anyway.
COVID-19 can cause a wide range of expenses depending on the severity of the illness.
From 2020 to 2021, the Minnesota estimate of the median amount paid by health plans for outpatient treatment of COVID-19 was about $975, according to an analysis by FAIR Health, a New York-based nonprofit group. York. The estimate takes into account laboratory, physician and emergency care services for patients diagnosed with COVID-19 that do not require hospitalization, according to a December report.
Medical bills skyrocket as cases become more serious. In Minnesota, the median for COVID-19 patients requiring non-complex hospital care was $17,906. For patients hospitalized with complex cases, the statewide median jumped to $87,451.
Complex hospital care for the most severe cases of COVID-19 refers to patients admitted to a hospital and requiring a ventilator and/or intensive care unit stay, according to FAIR Health. The group uses claims data to estimate what insurers pay health care providers for medical services.
At Minnetonka-based Medica, hospitalizations generated about $83 million in COVID-19-related expenses between October 2020 and September 2021. On average, Medica pays about 92% of the cost of medical claims, while patients pay the remaining 8% through cost. share payments directly with healthcare providers.
Thus, the decision to waive cost-sharing by COVID-19 patients resulted in an expense for the health insurer, since Medica paid the fees of doctors, clinics and hospitals, said Dr. John Piatkowski, medical director of the health plan. Medica does not yet have complete data on its COVID-19-related costs for 2021.
Medica began requiring patients to pay cost-sharing on Oct. 1 given the widespread availability of vaccines, he said.
“[We] I really felt that as it was controllable and we saw the different populations being able to control their risk, it really started to look more like some of our other medical conditions,” Piatkowski said. “We just wanted to be consistent between our policyholders. “
Eagan-based Blue Cross says it has paid about $200 million in COVID-19 treatments, the vast majority for hospital care.
“Because vaccines are now widely available and have been proven to significantly reduce the risk of severe illness, we felt the time was right to move COVID-19 treatment coverage to standard coverage” , Blue Cross said in a statement to the Star Tribune. “While the omicron variant has led to more breakthrough infections, vaccines are still proving highly effective in preventing serious illness – including hospitalization and death – from the COVID-19 virus.”
The six Minnesota’s nonprofit health plans — Minnesota’s Blue Cross and Blue Shield, HealthPartners, Hennepin Health, Medica, Sanford Health Plan, and UCare — are taking different approaches to COVID-19 cost-sharing in Medicare and Medicaid health plans .
Patients with questions should contact their insurer.
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