Across the world, healthcare facilities have reported an increase in costs as a result of Covid-19. Disinfection, sterilisation, infection control, setting up isolation wards, staff rotations and quarantines, and responsible waste disposal all now involve additional resources – namely time and money; while obtaining sufficient supplies of personal protective equipment (PPE) and ensuring physical distancing have proven to be both a logistical and financial nightmare. 

What’s more, expensive equipment that would typically be used for specialised operations and surgeries has been left gathering dust, until very recently, when some elective surgeries began to restart. But with an international travel hiatus that has lasted many months, hospitals across the world have witnessed a dramatic decrease in the number of international patients, leading to departmental closures and an overall loss in revenue.

Over on the other side of the fence, as reported in the May and June issues of ITIJ, the travel insurance and assistance sector hasn’t been having a particularly easy time of it either. An increase in the number of patients seeking health and wellbeing assistance has meant that companies have had to adapt to a new way of doing things, and very quickly – and a slowdown in medical claims over the past few months has meant that the industry is now preparing for a surge in claims as the global lockdown begins to ease.

First and foremost, the increased cost of PPE, medical goods and specialised equipment has caused pandemonium the world over. Private hospitals in India and Malaysia recently made headlines for charging inflated treatment rates due to having to incorporate these costs into their everyday operations, Egypt imposed a daily cap on costs for treating coronavirus patients at private hospitals, and numerous countries around the world reported insufficient stocks of PPE and ventilator equipment in their hospitals as levels of infection began to reach worrying heights.
Indeed, Lynne Fung, Executive Director of Business Development at Matilda International Hospital in Hong Kong, told Hospitals & Healthcare that costs of procurement have increased, especially on consumables and resources to implement preventative measures. “Our outbreak response plans were well established, so we have been able to maintain adequate supplies,” she said, “but costs rose exponentially for PPE where global supply chains were so highly stretched.”

Aetna International’s Vice-President of Population Health Dr Sneh Khemka detailed that the healthcare provider has witnessed increased utilisation of tests both for the Covid antigen and antibodies: “In some circumstances, these can add up to higher costs because of the need for repeat testing.” 

Covid-19 tests are also affecting operations at healthcare facilities, and the knock-on effect on cost is palpable. PK Rao, President of INF Visitor Care, told Hospitals & Healthcare that the US-based insurer is seeing an uptick in Covid-19 claims – primarily related to testing for Covid-19, but also cases of those infected with the virus itself. “We’re seeing the average hospitalisation is about 10 days, and even longer if you have a pre-existing condition,” he said. “What we’re finding is that members who have pre-existing conditions like diabetes and hypertension are resulting in complications like acute renal failure and cardiac arrhythmias.” As such, PK Rao notes that the amount of costs associated with ICU and hospital room charges have increased as of late.
PK Rao adds that as most of the new Covid-19 cases that INF Visitor Care has experienced have been from recent travellers coming from India, the onus is now on the Trump administration to start mandatory health insurance for visitors to the US. “The stress uninsured visitors are placing on US healthcare is quite large,” he said.

Jane Priestley of the International Department at Clínica Bofill in Girona, Spain, told Hospitals & Healthcare that the clinic has had the same problems as hospitals all over the world while trying to get enough supplies to keep our staff safe, adding that since Covid-19 tests were made available to health workers, quite a few have tested positive, many with no symptoms. This has led to the clinic struggling with a lack of staff on numerous occasions.

Speaking to Priestley further, it becomes clear that some hospitals have been forced to close their international patient departments due to a massive decrease in patient footfall. 
“Obviously, there are no tourists,” she said, “and although we do see a few expats, it wasn’t worth keeping [the international department] open for a few doctor visits a month.” She added, though, that Clínica Bofill is still open for national clients – and even as Spain’s borders have begun to open up to international travel, she explains that of the small numbers of tourists they are now seeing, most of them are nationals, and many of the hotels on the Costa Brava will not open at all this year. 

She also notes that local campsites have very low occupancy and some of the private medical centres along the coast will also not open. “Of course, this could all change at any moment, although, realistically, with the recent outbreaks in the area, probably unlikely,” she said.

Departmental closures may have been key to helping healthcare facilities minimise the economic blow that suspended travel has had for providers, but Gigi Galen Grobstein, President of Star Healthcare Network, an international cost containment company, ponders that if international patient departments are closed, then who will help expedite claims, schedule appointments and provide international patients with services for their specific needs? While there may be considerably fewer leisure travellers, there is still a global community of expatriates that require healthcare services.

Fung said that while the percentage of international patients has dropped for the facility in Hong Kong, the hospital’s focus during Covid-19 has been on local patients and international families based there – offering them a safe environment for their medical needs – something that Fung expects will continue to be the case throughout 2020. “We have been able to minimise the impact to our operations through flexibility in rescheduling, actively communicating with patients, stepping up preventative measures and catering services to newly emerging needs,” said Fung.

It probably wouldn’t be a surprise for anyone reading to learn that both Dr Khemka and Priestley say that while specialists are keen to return to work, patients are wary of setting foot in a hospital and risking infection. Indeed, PK Rao asserts that most of INF Visitor Care’s members in the US have postponed their regular sickness care.
As such, these ‘newly emerging trends’ that Fung identifies include virtual healthcare consultations and services that patients can access from the convenience of their home or workplace.

And these virtual/digital healthcare solutions, including the much-heralded telemedicine, offer cheaper, more accessible modes of delivery, explains Dr Khemka. So, in actual fact, providers that have been utilising these will likely have been saving money (see ITIJ’s recent telemedicine feature in the July issue for the full scoop on that).

Taking a macro view of the situation, Dr Khemka notes that the role of the primary care physician – whom Dr Khemka says is critical – has been drastically improved by the introduction of virtual primary care (which has increased substantially due to the conditions created by Covid-19).
“For the delivery of value and quality for healthcare, two things are very important,” Dr Khemka explained. “One is co-ordination; the second is lack of duplication. And the problem is that if you don’t have a primary care doctor, you’ll often see multiple specialists, and potentially have the same tests and investigations. In some cases, one GP will not realise what another doctor is prescribing, running the risk of poor drug interactions for the patient. During the pandemic especially, delivering this care virtually has had the dual benefits of keeping costs down and allowing people to access healthcare from the safety of their home.” He added: “Health systems around the world with very strong primary care infrastructure generally have a lower overall spend on healthcare. That’s because primary care physicians act as a first port of call, functioning as a gatekeeper to avoid unnecessary referrals into secondary care.”

Following a wealth of cancelled elective surgeries, as identified by Grobstein, and figures showing that the number of heart attack and stroke patients seen in A&E are down, as detailed by Priestley, there are clearly a large number of patients who are not receiving much-needed care during this time, so Dr Khemka’s logic should be applied when it comes to deciding on the best healthcare approach for these individuals. 

Not only that, but Dr Khemka also notes that around 60 per cent of primary care can be done virtually: “Especially when you have physical infrastructure to take bloods and other tests, and refer onto specialist care when a patient needs it.” By reducing unnecessary referrals into secondary care, the extra costs of PPE and overall operating costs in general could also be counteracted.

“Across the insurance industry, we’ve seen a temporary slowdown in medical claims because people have not been seeking elective care in the same way as before,” asserted Aetna’s Dr Khemka. 

PK Rao relays the same intelligence: “We are seeing a decrease in claims for routine sickness visits,” he said, “most of our members are preferring to use our $0 co-pay telemedicine service for things like coughs, joint pains, prescription refills, etc.”

Grobstein warned that this drastic change in claims volume could sometimes lead to providers cutting negotiations during this period, explaining that while many hospitals that Star Healthcare Network works with are being more generous with discounts due to a lack of money flow, there are rare occasions where providers are choosing not to discount claims during the pandemic. “It depends on their staffing, monetary situation and other factors,” she added.

“Providers are expecting timely payments/expedited payments especially now to help keep a constant flow, and international payors are pushing to get this done,” she continued. “This has been quite difficult depending on the geographic area of the international insurance.” She explains that some countries have a hard time paying with timeframes that are 15 days or less, especially during Covid-19.

But Dr Khemka reasons that with restrictions now easing, those who have held off on medical care during the pandemic are returning to hospital. “So, we’re preparing for a rebound,” he said. “I wouldn’t be surprised if we saw a potentially much higher rate of medical claims over the coming months than we would normally experience.”

For now, however, Grobstein says that having steadfast relationships between payers and providers has been key to maintaining the balance. “Having good solid relationships with providers and collection companies can help the preferred provider organisation (PPO) networks with continuing to discount claims that do come in and strategically work with providers on helping with outstanding claims,” she said.

At the same time, PK Rao detailed that Covid-19 has caused many travel insurance companies to revisit their policy provisions, perhaps adjusting actuarial tables. “Most providers in the travel space have abandoned coverage, leaving their clients scrambling to find new coverage during their stay in another country,” he told Hospitals & Healthcare.

However, Dr Khemka reassured that for at Aetna at least, the relationship with treating hospitals and clinics hadn’t really changed at all. “There has been a lot to cope with and there’s no doubt that we’ll be going through many phases of adaptation and challenge as we navigate our way in a world with Covid-19, but we’ve seen an absolute focus on the patient during this pandemic,” he said.

“Trying to contain costs year on year is always a tricky balancing act, and it’s possible we’ll see specific increases now as hospitals implement special measures due to Covid-19,” Dr Khemka told Hospitals & Healthcare. “As these rises can result in employers bearing more costs, it’s incumbent on the healthcare industry to try and find ways to tackle them wherever possible.”

From an insurance point of view, PK Rao reasons that whereas before Covid-19 there was ‘a race to the bottom of premiums’, now Covid-19 has ‘stabilised’ the market in that people are no longer looking for the cheapest plan – rather, ‘we see in the market a flight to quality plans during these uncertain times’. “Plans that offer only acute onset of pre-existing condition coverage are not cutting it for people who are looking for security in their plans,” he said, adding: “Travellers are looking not just for Covid-19 coverage, but also coverage for pre-existing complications related to coronavirus – which actually ends up being a much larger portion of the medical bill.”

Elsewhere, Priestly noted that taking a long-term approach, it was likely that hospitals would need to ensure that waiting rooms were not full to allow for social distancing while customers wait for their appointments, but it also seems paramount that a shift from reactive to proactive care is adopted. If anything, the challenges brought about by Covid-19 have shone a bright light on many of the inefficiencies that had long been affecting the healthcare system: patients that haven’t been encouraged to take a more proactive role in the management of their health; a shortage of healthcare professionals; and a geographical disparity in healthcare access across the world.

“Longer-term, I think the industry view of cost containment and case management will be revolutionised in the light of coronavirus,” said Dr Khemka. “We’ve recognised for quite some time that once a treatment path has been decided on, it is often difficult and sometimes inappropriate for an insurer to intervene and manage the case remotely.” 

He concluded that we will begin to see more and more insurers realising that it’s much better to be at a customer’s side before they go into hospital in order to try and help them to stay healthy and well: “Then, if they do experience an emerging condition, I think the uptake of virtual health services such as vHealth will continue to expand, to gain primary care advice and then to help manage both the journey for the patient and the associated costs.”