Health insurance execs assure investors business is good while asking government for aid

Morgan Haefner

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Executives at large national insurers have told investors that COVID-19 isn’t negatively affecting business, and could actually boost earnings in some aspects. However lobbyists representing the insurance industry are seeking assistance from the federal government as costs associated with COVID-19 remain uncertain, according to ProPublica

In recent calls with investors, executives at Cigna have indicated while higher medical claims for COVID-19 are expected, the costs will likely be offset by the cancellation of elective services. According to ProPublica, which cites a UBS analyst report from the conversations, Cigna executives told investors that they did “not see COVID-19 having a material financial impact” on business. So far, this has been evidenced in commercial payers’ first quarter earnings, which reflected minimal effects from the COVID-19 pandemic.

Despite assurance to investors, America’s Health Insurance Plans, an influential trade group that represents Cigna and other big payers like Anthem and Humana, are asking lawmakers for assistance during the pandemic. In an April 8 letter to Congress cited by ProPublica, AHIP told federal lawmakers its members are expecting “extraordinary” cost increases related to COVID-19 treatment. Many insurers have waived copays and cost-sharing for COVID-19 treatment. According to ProPublica, the letter did not mention potential savings from postponed elective surgeries. AHIP added that the costs are coming as premium dollars from employers are decreasing as newly unemployed Americans struggle to pay their bills.

AHIP asked federal officials to assist by providing subsidies to employers and individuals so they can keep their health plans. They also asked for funding for a program that would help commercial payers who face “extraordinary, unplanned costs” due to COVID-19. Other asks included relief programs for Medicare Advantage and Medicaid plans managed by private payers.

In a statement to ProPublica, AHIP spokesperson Kristine Grow said the effect COVID-19 will have on payers’ business remains uncertain, especially as elective procedures ramp back up. She said the policy proposals are meant to ensure people maintain their health benefits and to abate future price increases.

Read the full report here

More articles on payers:
Insurers extending prior authorizations for elective services
Insurers entitled to billions in risk corridors payments, SCOTUS says
These 7 top payer CEOs collectively made $151M in 2019

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