Insurance questions loom

Stephanie Leuck, account executive in the employee benefits division of Holmes Murphy It’s going to take a while to sort out just how 2020’s COVID-19 pandemic and the federal legislation it prompted will affect Iowans’ health care. “We’ll be talking about this year for years,” said Stephanie Leuck, account executive in the employee benefits division of Holmes Murphy. Based in Waukee with offices in Cedar Rapids, the independent insurance brokerage manages insurance plans for employers across the country. That Cedar Rapids office? It’s been pretty quiet since Ms. Leuck and her coworkers began to work from home as the COVID-19 pandemic hit about a year ago. Many of Holmes Murphy’s clients made the same shift, and benefit managers are still figuring out how it will affect not only employees’ health coverage but their well-being. “Mental health is the thing we’ve had more discussions on than ever,” Ms. Leuck said. “Not having that interaction around the water cooler, ‘What happens if I catch COVID?’ is really weighing on people. Even before the pandemic, mental health was on a lot of employers’ radars. They were looking at what they could provide.” As pandemic precautions disrupted workplace dynamics, work-from-home routines may have made people more comfortable with services provided online. “There are solutions that are emerging,” Ms. Leuck said. “There’s been a stigma around mental health, and now people are realizing if you need help, it’s out there.” Health claims plummeted as pandemic precautions took effect in March 2020, and benefit managers are still trying to figure out whether or when “normal” patterns will re-emerge. “Only the people that absolutely had to have care were going” to their doctor or clinic, she said. “We’re trying to make sense of what that would mean.” Holmes Murphy’s analysts and actuaries “were trying to help us to get calculations to help employers,” Ms. Leuck recalled. “As we saw those claims hit, it became more testing and treatment on an outpatient basis. It will be interesting to see how 2021 plays out with utilization. In 2020 we either avoided claims, or we saw those provided, if we could, virtually. Telehealth took off.” What happens as restrictions ease and people seek treatment they’ve put off for a year? “What’s the cost of the claim here in 2021?” Ms. Leuck said. “Has my disease progressed, am I looking at a claim that could be four times it would have been last year? That’s what we’re looking at.” Similarly, employer wellness plans were mostly on hold through 2020. “In recent years, a lot of employers would opt for a lot of on-site training,” Ms. Leuck said. “A lot of them hit pause in the past year, just out of concerns of bringing a lot of people together.” Pharmacy claims weren’t greatly affected as people grew accustomed to drive-through and delivery options. “Not as huge an impact,” Ms. Leuck said. “People were able to go out and get prescriptions.” Drug costs and pricing transparency will be “certainly top of mind” into 2022, Ms. Leuck said. “We have a lot of drugs entering the marketplace that have a specific disease in mind. They offer a significant improvement in quality of life, but a significant price tag, too.” The year bookended by the March 27, 2020, adoption of the CARES Act and the March 11 signing of the American Rescue Plan Act of 2021 saw benefit managers scrambling to keep up. “We’re trying to make sense of it all,” Ms. Leuck said. “We were dealing with the legislation coming to us on a fast and furious basis.” Ms. Leuck expects the ARP’s increased tax relief for child and dependent care will play a role in employees’ health-care decisions. Previously, individuals could set aside up to $5,000 before taxes for dependent care expenses; the new law increases the limit to $10,500 for single taxpayers. “For the 18 years that I’ve been in the industry, those maximums have never been touched,” she said. Federal relief provisions and industry consolidation may deliver more options to Iowans who buy coverage on the Affordable Care Act marketplace, Ms. Leuck said. “Iowa is somewhat limited, but we’ve seen that stabilize from what they were five, 10 years ago,” she said. “Maybe we can get a few more options.” Observers expect traditional insurance carriers to draw on their strengths in assets and in-house knowhow to pursue new revenue opportunities, including mergers and acquisitions, over the next few years. “We’ve seen a lot of marriages,” Ms. Leuck said. “We’ve seen health insurers and pharmacies marry up. It becomes just being more creative with what you can do.” Getting things back to a new normal will likely take most of 2021 and beyond. “A lot of our employers had to hit pause,” Ms. Leuck said. “Some of them had to go into temporary layoffs, to be able to access the federal dollars to keep the paychecks going. At the end of the day their goals were to take care of their employees and do what was in the best interests of the business in an unprecedented time.”