Health Insurance in post-COVID-19 world

Novel Coronavirus has disrupted every aspect of our lives. No industry is spared & no business untouched. One of the most impacted areas is the Health Insurance Ecosystem.

There are so many uncertainties & no clear answers to how things will change for health insurance. So here are my thoughts on what every insurance & benefits professional should watch out for in the near future.

Short Term Impact: 

1. Deferment of Planned Surgeries: Most of the non-urgent, planned surgeries have been postponed during this lockdown. This has improved the loss ratios in the short run, but this cost is bound to hit the insurers soon after restrictions are lifted. Further, the health status of some individuals - especially the ones with co-morbidities - may have worsened during this period - owing to lack of proper medical attention & monitoring. So the eventual cost of treatment could be much higher as more tests & medications will be needed, leading to longer recovery time.
2. Delayed Realization of Claims: Submission and processing of claims may have got delayed due to challenges of accessibility. Insurers may not disclose this upfront, hence it's important to keep an eye on the quantum of outstanding & IBNR (incurred but not received) claims.
3. Increase in Chronic Conditions: Lack of mobility, additional mental stress & unmonitored diets during the lockdown could lead to a rise in lifestyle conditions like diabetes & hypertension. For the diagnosed individuals, even a short disruption in their condition management efforts could lead to breaking of hard-earned healthy habits & behaviours. And people in borderline risk category could now suffer irreversibly. Another concern would be Cancer cases gone undiagnosed or diagnosed late - since health outcomes of cancers are directly related to timely diagnosis & intervention. 
4. Impact on Mental Health: It's an evident fact that our collective mental health has suffered during this crisis. The economic outlook, changes in work pattern & uncertainty about employment are causing much anxiety, depression and in some cases substance abuse. Some countries have witnessed an increase in domestic violence. 
5. Demand for Telehealth: This pandemic has given a huge boost to Telemedicine services. Many employers have provided such services as a stop-gap arrangement during the lockdown. But now, there would be an increased demand from employees for the continuation of these services. So, watch out for the cost of out-patient & pharmacy.
6. Maternity: The earliest COVID-impacted countries are reporting a spike in maternity intimations after lifting the restrictions. Whether this trend will follow in other goes remains to be seen.
7. Dental procedures: Cental services will be down to emergencies alone for the near foreseeable future. Since dental procedures require close proximity and lead to particulate matter suspension (through drills & jets), there could be concerns of around spread of respiratory infections. So the dental care industry will possibly have to undergo a radical change in treatment delivery soon.  

Long term impact: 

1. Technology in Insurance: One huge positive expected out of this crisis is that ‘Insurtech' will get a boost. Insurers have already started engaging with technology partners to improve their process efficiency, reduce cost & enhance customer engagement. The future of insurance could be fascinatingly different.
2. Healthcare Inflation: Pent-up demand for healthcare & subsequent demand-supply gap could increase medical inflation in the long run. This may translate into higher premiums, which in turn will lead to adverse selection & unstable risk pools. 
3. Preventive Care & Alternative Medicine: There will be a higher demand for vaccination, prophylactics & alternative systems of medicines. Benefit designs will need to be more accommodative.
4. Fertility Rates: Economic instability has historically been followed by a decline in fertility rates & higher age at conception. How will this particular crisis impact fertility trends, remains to be seen. 
5. Travel insurance: As the volume of business trips decreases, premium & scope of coverage for travel insurance is bound to be affected.
6. Underwriting for Pandemic Cover: Some employers & individuals got lucky by having pandemic coverage already included in the scope at a negligible premium. But now that the risk is realized, insurers are sure to change the scope of pandemic underwriting & pricing. 
7. Will insurers be more cautious in underwriting Rare Risks going forward? Climate change-related events are lurking on the horizon & we have no clue what health risks & impacts they will bring.