Experts are concerned that coronavirus patients might cause an unprecedented increase in insurance claims. If the coronavirus outbreak reaches a certain point of severity in the U.S., health insurance providers could end up with roughly $90 billion in medical claims. Under this scenario, insurance companies would need to use reserve funds to pay out those claims.       

According to analysts at S&P Global, an estimated 50 million insured Americans will contract COVID-19 eventually – it’s just a matter of time. However, even if the coronavirus outbreak remains moderate and in line with a strong flu season, outpatient claims for visits and testing will likely exceed $12.75 billion. In this case, insurance companies will see profits drop, but won’t experience a devastating loss. Still, the impact on health insurance companies will be huge.

Healthcare Organizations Are Overwhelmed; Claims Are Multiplying

Hospitals, doctors’ offices, and clinics are seeing an exponential influx of new coronavirus patients. As such, the number of insurance claims is rising, whether it’s for testing or treatment related to the COVID-19 disease. The influx of patients is financially straining the insurance companies as well as the healthcare organizations. The healthcare system just wasn’t ready for a pandemic.

Some healthcare companies are protecting themselves against the financial impact of the pandemic by working with healthcare data consultants. For instance, data consulting firm AArete has been leading many healthcare organizations through the COVID-19 pandemic through data-driven strategies. For health insurance companies that want to mitigate the potential for an overwhelmed system clogged with claims, data consultants are essential.

Coronavirus Testing Now Has A Unique Code For Billing

When the COVID-19 pandemic first hit the United States, medical tests and treatment related to the novel coronavirus weren’t being covered under most health insurance plans. Many patients were walking away from hospitals and clinics thousands of dollars in debt for testing that should have been covered.

At first, healthcare facilities weren’t coding coronavirus tests and treatment in a manner that would be covered by insurance providers. Thankfully, that’s changed since the CDC and the WHO released guidelines on using ICD codes for COVID-19. This includes a newly created test code for COVID-19 used specifically for CDC testing labs to test for SARS-CoV-2.

Now that testing is almost universally covered, people who suspect they have coronavirus symptoms aren’t hesitating to get tested.

As More Testing Is Encouraged, Claims Will Continue To Increase

Getting tests covered is just one part of the equation. Those tests need to be readily available. Thankfully, COVID-19 test kits are being rapidly deployed to medical facilities across the U.S. and the need for more testing can finally be fulfilled.

A growing number of institutions and organizations are calling for more coronavirus testing, including researchers at Harvard University. Researchers at Harvard suggest that it won’t be safe to reopen the U.S. until testing triples. Currently, an average of 146,000 people are being tested each day. The Harvard researchers say daily tests need to reach 500,000-700,000 to effectively identify and isolate infected individuals before it will be safe to reopen the economy. 

If this model is followed, the number of insurance claims will skyrocket. The insurance companies will see more claims than they’ve ever handled at once. 

It’s safe to say that nearly all patients will file claims for the coronavirus test, but those who test positive will also file claims for necessary treatment. This is where insurance claims will begin to grow exponentially.

Hospitalizations Will Further Increase Insurance Claims

S&P Global analysts warn that if the pandemic turns severe, the U.S. will see nearly 8 million people hospitalized. This will undoubtedly overwhelm the hospital system, but will also overwhelm the insurance companies. Even though most insured Americans have high deductibles, covering even a portion of hospitalization bills for 8 million Americans will create devastating revenue losses for insurers.

We Need Our Insurance Companies

Nobody knows when the pandemic will truly be over, nor how long we’ll feel the economic impact of the damage already done. Although many complain about the high cost of insurance, we can’t afford to let our insurance companies fold. 

No insurance provider will escape this pandemic unscathed. However, a greater advantage will be provided to companies that make data-driven decisions in the face of uncertainty.