COVID-19: Q&A on the importance of modeling for payers during the pandemic

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March 31, 2020

HRI spoke with Thom Bales, a principal with PwC’s strategy practice, Strategy&, about the firm’s health capacity planning model and the importance of modeling for payer planning needs during a pandemic like the SARS-CoV-2 viral outbreak responsible for COVID-19.

PwC Health Research Institute (HRI)

Payers need to engage members even more during a pandemic. How can this model help direct their resources?

Thom Bales, PwC Strategy& Principal

As health plans are continuing to respond to the crisis, we believe they have an immediate opportunity to drive even greater impact in the next two to three weeks, and this model can help. We are still weeks away from a peak in COVID-19, and our health systems are already short on critical equipment.

Our capacity planning model analyzes the potential impact of COVID on vulnerable populations by geographies—which suggests that if payers adapt their medical management and service practices now, both the rate of transmission and the ability to provide treatment could improve with a few discrete actions:

  1. Identifying the populations and individuals with highest potential severity impact.
  2. Proactively intervening with those individuals through education, social determinant assessments and care management.
  3. Coordinating with providers on intensive care capacity and directing members to right sites of care.

The model is built on a dataset that is a digital twin of the US population. Within that digital twin, we understand the different conditions and disease states of the population at the ZIP code level that create the potential for severe response to COVID-19, such as age, COPD, smoking and so on.

Additionally, the model overlays intensive care capacity (and expanded capacity). Together this creates an understanding of individual ZIP-code-level impacts—who is most likely to have a severe response to COVID-19 and local health systems’ abilities to treat those infected.

Payers can then coach individuals on prevention. They can coach hospitals on whether to think about adding capacity and other sites of care or telehealth. Payers can use their whole toolkits to make this happen—direct calls, emails, emergency notifications and so on—making sure they’re reaching the most vulnerable. Not only do we think there is community benefit to this, but the cost is not great and the impact could be significant.

Also, with this model, we’re overlaying other transmission models, such as the Imperial College London model and the Columbia University model, to understand where we see the peaks and when they might occur.

If you’re a national payer, you can think about how you prep different regions at different times to support that progression. You can consider how you might run interventions in an urban versus a rural area.

If you’re a regional payer, what perhaps is more important is how you bring together the total health network, which is really multiple networks—community, state and so on—to direct resources. Any better understanding of the transmission and severity of COVID-19 can help payers manage the business they are in, which is providing patients access to care.

A third area that payers can support is internal operations planning. They must plan for whether there will be a surge in calls, a surge in nurse support, or folks calling in sick because they have a fever. How do they staff relative to that? Modeling will also help them think about when they will see an ebb and flow of service and claims?

The healthcare capacity model was developed as a response to the COVID-19 pandemic and is intended to help healthcare stakeholders make better decisions for their members and patients. It takes a broad view of understanding what is known about social determinants of health to help guide population health decisions. Through those variables, it creates more personalized experiences for consumers and members based on who they are.

HRI: What is the role for payers in the information loop to redirect capacity and resources? How can they help labs and pharmaceutical companies?

Thom Bales: There’s a lot of information out there hitting different stakeholders—providers, members, governments, employers. A lot of rapid decisions are being made. Here, payers can be a trusted source of information.

They can quickly understand and put into plain language what the local governments are requiring, help eliminate confusion and direct resources in the right way. Payers to some extent already direct patients to the right resources and can serve as the first point of triage to resources in the region.

In terms of labs and pharmaceutical companies, payers can use the model to help communicate when they expect to see spikes, reducing potential shortages at the pharmacy for medicines or tests. They can also solve for the ongoing challenges in information gaps on patients.

HRI: How can predictive model insights help with community planningespecially with the interplay between pandemic repression and economic effects?

Thom Bales: On the community planning front, you can start understanding the actions the community has to take. Is the community likely to need additional ICUs? Additional ventilators? The model can help with that.

Also, health systems are in a vicious cycle right now because they have delayed nonessential surgeries. We’re going to see health systems with fixed costs not seeing reimbursement, creating liquidity crises for them.

For payers, we don’t yet know the balance of realized claims during this period and delays in premiums or shifts in product or segment mix. The impact will vary by payer. Those with the greatest small group exposure may be most at risk from deferred payments or lost membership.

The model can help them make decisions that could impact the revenue cycle: premiums and coverage, and access and delivery to nonessential care. We can optimize access to care and optimize around the revenue cycle.

The healthcare capacity model was developed as a response to the COVID-19 pandemic and is intended to help healthcare stakeholders make better decisions for their members and patients. It takes a broad view of understanding what is known about social determinants of health to help guide population health decisions. Through those variables, it creates more personalized experiences for consumers and members based on who they are.

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Thom Bales

Principal, Strategy&, PwC US

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