Zoomed in a a big bolt holding chains together.

How Health Plans Can React to the ‘Now’ and Prepare for the Aftermath of the COVID-19 Pandemic

By Richard Merino

April 16, 2020

“Everybody has a plan until they get punched in the mouth,” famously uttered by championship boxer, Mike Tyson, when asked about his opponent’s fight plan, prior to a bout, has great relevance today as the entire world is defending itself against the COVID-19 outbreak that has strained our collective healthcare systems to their breaking point.

In the U.S., since the declaration of a national public health emergency on January 31, 2020, by the Department of Health and Human Services, all aspects of the healthcare continuum have been forced to enter a quasi-wartime footing. This act has required a quick and strong response from the health plan community. Operations are being forced to balance the need for responsiveness to their panicked members and overwhelmed providers while still maintaining a sense of operational and financial stability. How a health plan adjusts and conforms to this reality will be the difference in whether they get “KO’d” or win the fight.

Like all successful plans, one must look to and cure short-term challenges while also preparing for the future. In the case of a health plan’s reaction to the COVID-19 outbreak, both aspects must be considered as time is of the essence. As the following sections detail, a time period phased approach may be the best means to consider this crisis and enable the health plan to advance deftly in the aftermath of COVID-19.

Phase I: Work in Process

Several leading practices are vital to the success of the health plan’s program for its COVID-19 response. As such, many of the following actions must be made mission critical to allow for the marshalling of necessary resources.

  1. COVID-19 Task Force

Health plan senior leadership should identify and gather their most trusted individuals from the clinical, operational, compliance, and finance areas. Once gathered, the task force will serve as the health plan’s “face” to the internal staff, as well as to the external market as to how the health plan is going to react to the COVID-19 crisis.

The task force should immediately work on a COVID-19 action plan. This plan will address vital functions such as utilization management, claims, care management, corporate communications, and premium finance. Further, the plan should address the anticipated resource, volume, communication, and clinical needs for the member population using available plan and external data, including projections of service volumes, inpatient hospital utilization, COVID-19 testing availability, membership risk profiles, and pharmacy needs.

For each aspect of the action plan, there should be contingencies for unanticipated surges and unfortunate circumstances of key resources becoming infected and unable to work. As this plan is implemented, affected staff should be made aware of upcoming challenges that will be vital to its collective success.

  1. Operational Staffing and Projections

There should be an understanding from plan leadership that, barring something unforeseen, there will be a tremendous uptick in volumes of service requests, customer/member service calls, especially claims. This understanding should translate into a surge staffing and resource plan that evaluates the current state of resource allocation and allows for the availability of additional resources to assist in the anticipated surge. This surge can be accomplished through existing resources, if enough, or through the contracting of delegated entities, temporary agencies, or alternative avenues of staffing.

Staffing considerations should include that most of the country is under a “stay at home” or “shelter in place” order. Therefore, virtual workforce concepts, remote workstations, and home connectivity must be addressed in any staffing plan. Strong policies and procedures must be developed and followed as most work will be done beyond the scope of direct managerial control. As such, there needs to be strong job aids, process documents, and training to ensure quality. Here, the important consideration is time. The plan cannot afford to be caught flat footed without adequate ramp up of resources when the surge of activity commences. A resource gap will prove disastrous.

  1. Utilization Management

The Coronavirus infection often has a long incubation period before attacking the patient with severe symptoms including the onset of Acute Respiratory Distress Syndrome, high fever, extreme fatigue, and adverse organ involvement. Since these symptoms and the patient’s condition can turn severe quickly requiring acute inpatient admission, health plans should adjust their utilization management rules to account for the unique aspects of this outbreak and the associated strain on hospitals.

Common rules around prior authorization to network or contracted facilities, pre-admission clinical review, notification of inpatient admission, and concurrent review should be relaxed in those cases that are suspected to be COVID-19 related. It is not in the member’s or the plan’s best interest to cling tightly to existing utilization management rules that cause potential access to care issues.

  1. Care Management

Many health plans, particularly those in the Medicare Advantage market space, have established care management programs that track, plan, and coordinate services for certain member populations. These populations are often compromised either socioeconomically, institutionally, or have a history of chronic conditions such as diabetes or chronic obstructive pulmonary disease (COPD). Particularly important in these subpopulations are acute risk profiles in the context of the COVID-19 virus. Members of advanced age with underlying comorbidities, including many established chronic conditions, sit squarely in the highest risk categories for hospitalization, ICU placement, intubation, and ventilator utilization.

Plans with this member subpopulation have the unique ability to pinpoint their highest risk members and perform proactive outreach, coordinate care, establish service needs such as testing or telehealth, and work with associated providers to reduce the incidence of acute COVID-19 infection.

Plans should immediately analyze the member demographic and clinical data to identify at risk members and accelerate care management activities, including education and outreach, to help prevent adverse events due to COVID-19 infection.

  1. Government Program Adjustments

Health plans that are contracted with federal or state governments through the Medicare Advantage or Medicaid programs have conditions considering the COVID-19 outbreak. On March 10, 2020, CMS released a memorandum[1] that instructed Medicare Advantage plans to make certain adjustments to their plan administration. These requirements include:

  • Cover Medicare Parts A and B services and supplemental Part C plan benefits furnished at non-contracted facilities subject to §422.204(b)(3), which requires that facilities that furnish covered A/B benefits have participation agreements with Medicare
  • Waive, in full, requirements for gatekeeper referrals, where applicable
  • Provide the same cost-sharing for the enrollee as if the service or benefit had been furnished at a plan-contracted facility
  • Make changes that benefit the enrollee, effective immediately, without the 30-day notification requirement that includes waiving of utilization management requirements and co-payment reductions
  • Allow for the expansion of telehealth benefits

Health plans with existing Medicare Advantage contracts, to the extent that operational adjustments have not been made, must implement these changes and demonstration execution should CMS request such support. These requirements are logical extensions of plan benefit schema given the current environment and should be adopted through system update, staff training, and policy revision as soon as possible.

  1. Corporate Communications

In such trying times as these, health plan senior leadership, in concert with the Board of Directors, must develop and coalesce around a message of service and comfort for their internal stakeholders, membership, and community. The public-at-large is understandably apprehensive about the situation and this is particularly true of the members of the health plan. Since the health plan is a vital cog in the healthcare service available during this crisis, it is essential for the plan to communicate its commitment to working with membership, providers, and the community. This message should also provide specifics on the steps that the health plan is taking in response to the outbreak, and set the expectations of members when utilizing their benefits, such as a waiver of co-pays for COVID-19 services.

A similar message of solidarity to the plan’s internal stakeholders and staff is equally important. Every member of the plan’s family should know that their sacrifices of time, availability, and effort will be recognized and rewarded by the plan that employs or contracts with them. This unifying message from the top of the organization serves to bring calm and provide assurance that the plan recognizes the severity of the situation and will be there for support. This communication can be developed and communicated in various forums, but the strength of the message must be clear and powerful.

This communication cannot just be an instance. Periodic communications of support, updating of status, and continued commitment must be re-emphasized throughout the crisis. Members rely on their health plan in many ways, and understanding the conviction of the plan is a powerful message indeed.

  1. Pharmacy Services

As most health plans work with Pharmacy Benefit Managers (PBMs) to administer the drug components of their various plan designs, the PBM must be briefed on the relevant aspects of the COVID-19 action plan. As most have witnessed in the past few weeks, several drug regimens have surfaced as possible therapeutic responses to the COVID-19 virus. These identified drugs include an anti-malarial such as Hydroxychloroquine, a retroviral such as Leronlimab, and established antibiotics like Azithromycin. These drugs have been in market for some time and have had some level of coverage for most health plans for other therapeutic indications such as Lupus or Ebola.

It is essential for the plan and its PBMs to strictly follow the CDC or FDA guidelines related to off-label usage and other guidance as they request or dispense these drugs. As many or most of these drugs are dispensed in the inpatient hospital setting, PBM control may be somewhat limited, but to the extent that any drug approved for off-label usage in the treatment of COVID-19 is dispensed in an outpatient setting, including long term care or retail, accommodations for coverage must be considered.  This can include relaxation or waiver of prior authorization rules that would otherwise apply.

Not only for drugs used for treatment of COVID-19, plans and PBMs should evaluate and implement appropriate measures to limit disruption in enrollee access to drugs which may reasonably be expected to occur for enrollees who are displaced or unable to obtain drugs through typical channels, such as visiting a retail pharmacy. These measures can include lifting of “refill too soon” or formulary edits restricting dispensation of drugs and co-payment or co-insurance reduction or waiver programs.

It is also important to remain informed of any guidance or restrictions issued by local state boards of pharmacy or medical boards regarding dispensing of drugs used in the treatment or prophylaxis of COVID-19.

Phase II: Surge in Activity

With a COVID-19 task force, action plan, and resources ready for a surge in activity, the health plan must react to the initial wave of demand. We advise that plans stay their course but remain flexible.

  1. Customer/Member Service Call Spikes

In a public health crisis, members of a health plan need information and guidance on conditions, coverage, access to services, and the status of claims. Members’ first point of contact will be the services call center. With this knowledge, the health plan must ramp staffing levels to adjust for the higher than normal call volume. Health plans should look at this period like open enrollment either through reserve resource availability or vendor assistance.

Responding to call volume through staffing adjustments is not enough. Representatives must be trained and knowledgeable of the plan’s benefits, adjustments, resources, and information to help the caller during a crisis. This qualitative action must be in lock step with the quantitative maneuver of increasing member service call center staff.

  1. The Rush of Claims

With healthcare providers swamped with COVID-19 cases in addition to other non-elective inpatient services, claims characterized as emergent/urgent in nature, with very high acuity and high billed charges, will surge. To address the influx of these claims, health plans must prepare their claims processing systems and personnel to address peak demand.

From a systems perspective, most claims processing systems can be configured with a rules engine that allows for certain claim blocks or “edits” to be customized or removed. It is likely in the best interest of the health plan and the provider to address these edits to allow for auto-adjudication of certain claims related to services provided for a COVID-19 infected member. In a normal process, these claims may stop processing for medical review or utilization management reasons but under the circumstances health plans should consider lifting these stops.

Another system update will need to involve claims pricing. As the concept of in-network and out-of-network claims are blurred, or the distinction removed altogether, health plans should adjust pricing for out-of-network claims at established Medicare fee schedule rates, regardless of plan type.

Hopefully, these steps allow for more auto-adjudication of COVID-19 related claims; however, if there are volumes of claims that require manual claims processing, the health plan should have its experienced claims processing staff ready to address these claims with speed. Providers, especially hospitals, will need quicker claims processing turnaround times including reimbursement; the health plan should accelerate back-end claims payment processes.

Continuous monitoring of the claims process for timeliness and accuracy is essential and should be reported as a metric through the COVID-19 action plan. As the metrics dictate, changes to the staffing model or system configuration should be considered.

  1. What about Networks?

One of the major advantages in being a health plan is the ability to contract with an established network of providers that have rates negotiated at set amounts and follow particular rules around utilization management and quality. Health plan members access these preferred providers at reduced cost sharing. With the onset of COVID-19, that paradigm should necessarily shift, to a completely open network model. Members that encounter a COVID-19 infection cannot be penalized for utilizing an out of network provider, particularly an inpatient hospital facility.

Policy changes that can be enacted include, making member cost sharing the same regardless of provider network status for COVID-19 services, suspension of network protocols, and suspension of denials for out of network claims.

Phase III: Stabilization

As the worst of the crisis appears past, the health plan must remain consistent in the execution of the COVID-19 action plan. This period of stabilization is not the time to pivot back to normal operations, but some protocols may be reviewed to determine their continuing effectiveness.

  1. Lagging Claims

Providers, especially hospitals, are on the front lines of this pandemic and some of the geographic hotspots may not peak until later in the cycle. As such, health plan claims operations should expect there to be a gradual slowing of the rate of claim submission and should not draw down staffing or change system parameters for COVID-19 claims.

It may be possible, however, that more non-COVID-19 related claims start to enter the processing stream, at which point they should be processed and handled consistent with established policy. Specifically, as more elective or non-emergent covered services present, the claims processing rules including network, utilization management, and member cost sharing may be reinstated iteratively.

Close monitoring of the claims process must be maintained, however, to make sure that COVID-19 related claims are not mistakenly made subject to the pre-pandemic rules. At this point, review of claims denials will be vital to assure no mismatch.

  1. Continued Care Management

High-risk members for infection, or those members identified as having the COVID-19 virus in the past 90 days, should be tracked closely by the care management operation of the health plan. This management should include outreach to the member to check health status, evaluation of admission or readmission events, changes or updates to the member’s care plan, or communication with the member’s primary care and/or specialty providers.

As we do not yet know how possible reinfection may occur, or the length or strength of antibody resistance to the virus, follow-up care management that minimally identifies readmission risk should be undertaken. This practice will serve to prevent gaps in care from an access or quality standpoint.

Phase IV:  Beyond the Pandemic

The health plan must assess its response to the pandemic, identify areas of weakness where the action plan was ineffective, and address operational deficiencies that need to be shored up. This situation is a stress test of a health plan’s ability to quickly adapt its operations to address an urgent public health need, while maintaining a sense of operational stability that will prevent any lasting negative impacts to the plan.


[1] March 10, 2020 Memorandum to All Medicare Advantage Organizations, Part D Sponsors and Medicare-Medicaid Plans regarding Information Related to Coronavirus Disease 2019 – COVID-19