While 2020 has seen the drastic uptake of telehealth solutions, which provide a more efficient way for insureds to access healthcare than more traditional methods of care, the ‘true impact’ of delayed elective treatments will begin to surface in 2021, says Cedric Luah, Willis Tower Watson (WTW) Asia and Australasia Head of Health and Benefits.
Separate reports from WTW and Milliman predict an increase in employee-sponsored benefits costs next year due to deferred care and increased demand, as well as Covid-19 treatment and testing. WTW’s report revealed that employee-sponsored benefits costs are expected to increase substantially in the Asia-Pacifc (APAC) region in 2021 – close to half of the insurers (49 per cent) surveyed in APAC expect that medical cost increases will remain constant over the next three years, while 40 per cent expect costs will continue to increase. In April, the Integrated Benefits Institute warned that the total cost to US employee benefit plans from Covid-19 could exceed US$23 billion.
Employers won’t make cost-shifting changes
However, employers won’t make the necessary cost-shifting changes, such as raising deductibles or copays to the healthcare benefit plans in 2021, said HR consulting firm Mercer.
Still, Mercer’s survey also revealed that employers have placed a heavy focus on digital offerings, with over one-fourth of respondents asserting that their organisations are adding or improving telemedicine, virtual office visits and similar resources.
“Many employers are avoiding health plan changes that impact employees this year, but they know managing cost must remain a priority,” Tracy Watts, Senior Consultant at Mercer, said. “Plan member stress and care avoidance in 2020 may result in higher utilisation in 2021 and struggling health systems may seek to recoup lost revenue through higher prices. On the plus side, the momentum behind digital health innovation is driving towards greater efficiency, better health management and greater member satisfaction.”
Utilisation of virtual health continues to rise, despite cost concerns
WTW’s Luah reasoned that while the accelerated adoption and use of telehealth could help provide patients with a more convenient way of accessing healthcare, ease of access leading to higher utilisation could also boost overall costs.
But Hospitals & Healthcare also notes that the increased access to preventative care that these virtual health employee benefits offer will likely also drive down the instance of preventable chronic diseases – which will no doubt help drive down the cost of healthcare over time too.