Tag Archives: Tom Murawski

COVID-19 and the future cost of coverage in the commercial health insurance market

Although pricing actuaries are trained to project future costs in environments of heightened risk, COVID-19 has introduced unprecedented disruption and uncertainty. The pandemic has affected all aspects of the healthcare industry and the American economy, altering the landscape in ways that may both increase and decrease expected costs. This volatile and uncertain environment also presents an extraordinary challenge for health plans developing rates for 2021 commercial coverage.

This paper by Milliman’s Jeff Milton-Hall, Tom Murawski, and Doug Norris is intended to help commercial health plans navigate this evolving environment. The authors discuss key considerations for how the pandemic and its aftermath could affect the cost of health insurance coverage in 2021.

Dental utilization adversely affected by coronavirus

The economic ramifications of the COVID-19 pandemic are just starting to be felt and will likely intensify for some time to come. For dental offices, whose production is closely tied to consumer disposable income, an economic recession can cause major changes in patient traffic and the types of services sought.

While an economic downturn alone affects demand for dental services, this time the downturn is preceded by a period of depressed demand for services due to provider-driven, patient-driven, and broader community-driven efforts to limit the spread of COVID-19. As such, there is the potential for two phases of utilization impact, each with unique characteristics.

In this article, Milliman’s Joanne Fontana and Tom Murawski explore the potential effects of the COVID-19 pandemic on the dental industry, considering changes in utilization of dental services that could result from the pandemic and its containment efforts as well as the economic ramifications that are already starting to occur and may last for some time.

Insurers need to brush up their dental care rate manual

Compared with medical lines of business, dental products typically have more predictable claim patterns, lower overall claim dollar amounts, and much lower risks and severities of catastrophic claims. This predictability can foster complacency in dental rate-setting. Some companies go several years without a robust dental rating manual review or refresh. Companies instead may choose to focus on rating manual updates for higher-risk lines of business, and insurers may simply “trend forward” their dental rating manuals year after year without taking a critical look at what they should change.

It’s important to periodically review dental rating methodologies for actuarial soundness and to maintain competitive rates. If the starting claim costs and pricing factors in a rating manual are stale, premiums likewise will be stale and competitive positioning in the market could suffer as a result.

In this paper, Milliman’s Tom Murawski and Sean Hilton discuss why actuarially sound rating manuals are essential to adequate and competitive pricing of dental insurance rates.

Introducing the SSIP: Provisions for market stabilization in the Better Care Reconciliation Act

On June 22, the U.S. Senate released its draft of a bill to amend portions of the Patient Protection and Affordable Care Act (ACA), called the Better Care Reconciliation Act (BCRA). The State Stability and Innovation Program (SSIP), part of the BCRA, is a grant program that provides funds directly to insurers as well as to states with the primary goal to stabilize and support the individual market. The SSIP is composed of two distinct parts. The first provides funds for short-term market stabilization programs that will go directly to insurance carriers in the first four years of the program. The second provides funds for the “Long-term SSIP,” which will be allocated to states starting in 2019 to fund various programs.

This paper by Milliman’s Thomas Murawski discusses elements of the SSIP and outlines the details from the draft bill released on June 22.

Considerations for Patient and State Stability Fund stakeholders

As the healthcare reform debate continues in Washington, D.C., it is worth revisiting one of the key components of the proposed American Health Care Act (AHCA). The Patient and State Stability Fund (PSSF) is a grant program included in AHCA intended to stabilize individual and small group state insurance markets and lower patient costs. The PSSF would appropriate a total of $100 billion to states over the period 2018 through 2026. In this paper, Milliman’s Paul Houchens, Kathleen Ely, and Thomas Murawski discuss elements of the PSSF as proposed by the American Health Care Act (AHCA) on March 6, 2017. The authors also explore the following considerations for stakeholders.

• Value of reinsurance option
• Short application window
• State-specific impact of AHCA provisions
• High-risk pools
• State-run cost-sharing subsidies
• State-run premium subsidies
• Reduced Medicaid enrollment and benefits
• PSSF grant allocation methodology
• Promotion of and payment for preventive care
• Impact to healthcare providers