Swine Flu May Mean Financial Aches and Pains for Health Plans
By: Health Insurance
Submitted: 2009-09-02 12:37:47 | Word Count: 1300
Once the vaccine becomes publicly available, likely by October, several large health plans tell HPW that they will offer the H1N1 (i.e., swine flu) vaccine to members whose benefits cover vaccinations. The cost of the vaccine (about $10 per dose, similar to that of the seasonal flu vaccine) and the expense of treating members who contract the illness could have a substantial financial impact on plans.
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Case in point: During second-quarter earnings conference calls with investors, several health plan operators said H1N1 already had a financial impact. In UnitedHealth Group’s July 21 conference call, CFO Mike Mikan said services tied to the treatment of members who had, or thought they had, H1N1 cost the company about $50 million in the second quarter. Aetna Inc. CEO Ronald Williams predicted flu-related medical expenses would continue to increase in the third and fourth quarters of 2009; Aetna President Mark Bertolini predicted a “severe fall flu season.” Medicaid operator Molina Healthcare, Inc. said it had seen higher-than-usual numbers of flu cases in the second quarter, and noted that several children who had recently been sent home from overnight summer camps have tested positive for the H1N1 infection. “These cases associated with increased physical proximity may foreshadow an increase in the number of novel H1N1 cases when children return to school next month,” warned Molina Chief Medical Officer Michael Siegel, M.D. He noted that the attack rate for the disease is highest in people under the age of 25, a group that makes up a sizable portion of Molina’s membership.
The CDC is in the process of developing a vaccine after the outbreak earlier this year, and recommends that certain populations — including pregnant women, people who live with or care for children younger than six months and health care and emergency medical services personnel — be vaccinated first. More than 43,000 cases of the flu have been documented so far in the U.S., according to the CDC.
H1N1 Vaccine Is Typically Covered
Here’s a look at what health plans are doing to inoculate and educate their members:
* United: On Aug. 20, the company said it will cover the administration of the H1N1 vaccine for members whose benefit plans cover immunizations, and also cover the administration of the vaccine for members whose plans currently do not include immunizations and do not plan to in the future.
* WellPoint: In its second-quarter earnings call on July 29, executives from WellPoint, Inc. mentioned that the Blues plan operator had seen only a modest increase in medical services utilization. The next day, WellPoint announced that it will cover the administration of the H1N1 vaccine when it becomes commercially available to the general public. According to the plan, the vaccine will be covered for those members with coverage for vaccines. The company also will continue coverage of seasonal flu vaccine. Blue Cross and Blue Shield of Georgia (BCBSGA), a WellPoint subsidiary, said this month that the majority of its 3 million members have vaccine coverage. Spokesperson Cheryl Monkhouse says it’s difficult to predict the demand for the vaccine. She points out that the CDC is encouraging people to get vaccinated for both H1N1 and seasonal flu.
“BCBSGA is currently looking at opportunities to encourage members to get the H1N1 vaccine this season,” she says. “We conduct annual marketing campaigns surrounding the flu season, which include postcard reminders, member newsletter articles, targeted mailings…and we are considering the incorporation of H1N1 messaging into our existing campaigns as well as a variety of other avenues.”
The Georgia Blues plan incorporates seasonal flu costs impact into its annual budget, but Monkhouse says it cannot provide cost estimates for the upcoming flu season. “Anything we provide would be a very rough estimate, which could change from week to week [and] month to month,” she says.
* Molina: In its Aug. 4 call with investors, the Medi-caid plan operator said it was boosting its efforts to educate members about the new flu strain through mail and by automated telephone calls, and is urging members to get their annual flu shot earlier than usual. Siegel said the company also is working with network providers to reach high-risk patients. Molina also has launched its own employee flu prevention education program and will offer work-site flu vaccinations.
* CIGNA Corp.: CIGNA says it will cover the H1N1 vaccine under its preventive care benefit, meaning that about 75% to 80% of the insurer’s membership it will be covered without copayments or coinsurance, says spokesperson Gloria Barone. Given the public’s already high awareness of H1N1, she says, CIGNA expects a high demand for the vaccine, but the financial impact to the company is unclear right now. “While we anticipate higher demand for the vaccine, this is offset by the fact that public health officials are also planning on providing vaccines for free through public health clinics,” she says. The company will communicate with members about H1N1 via its MyCIGNA.com Web portal and through its 24-hour information phone line. Plus, CIGNA says its case-management and Health Advisor nurse teams will educate members and provide up-to-date information. “Individuals will be directed to their physicians/health care providers to discuss their specific care questions in high-risk and complex situations,” Barone says.
* Health Net, Inc.: The California-based health plan expects to cover the vaccine once it is available and approved by the FDA, says spokesman Brad Kieffer. He agrees that the demand for the H1N1 vaccine could end up being higher than that for seasonal flu vaccine because of the media attention it has received. The insurer, however, says it does not expect any unfavorable financial impact by covering the vaccine, he says.
Health Net will communicate with at-risk groups through its newsletters, telephone outreach, partnerships with government agencies and community-based organizations, and through its Web site, Kieffer says.
* Aetna: The company says its members typically have a “a high level of interest” in seasonal flu vaccines, says spokesperson Wendy Morphew. “As a result, we have always been proactive about educating members on the importance of flu shots and alerting members to the variety of convenient locations where they can receive a covered flu shot. We expect a similarly high degree of interest in the availability of the H1N1 vaccine and Aetna’s coverage of its administration.” Aetna also intends to offer the H1N1 vaccine for members whose plans cover vaccinations, she says. In addition, the insurer has an education program on H1N1 that is being made available to members, plan sponsors, brokers and Aetna’s own employees. Resources available on its Web site include fact sheets, Q&As and tips on preventing infection; downloadable posters and flyers on how to avoid the flu; and a video on proper hand-washing technique.
Members also will receive information through the insurer’s password-protected member self-service site. “Our traditional seasonal mailing in September highlights flu vaccines and this year will include additional information on the vaccine,” Morphew says. “Through Aetna’s CareEngine, we will also be able to identify through claims data which members may be at particular risk so that we can proactively reach out to those members to encourage them to be vaccinated,” she adds.
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