If there’s one thing we know about payers, it’s they hate surprises. That’s why they consume data, seek precedents, and absorb historic trends as they manage care for thousands or even millions of Americans.

So the unprecedented nature of COVID-19 is wreaking havoc with their plans. In the past 100 years, the U.S. has not experienced anything like this. There were no models. There wasn’t even collective knowledge. What’s the way forward for healthcare?

It sparked our curiosity: How are payers responding? What’s their new norm? Is it changing their outlook? Our team at Syneos Health Value and Access talked to 20 pharmacy and medical directors representing national and regional payers, insurers, IDNs, and hospitals. We wanted to understand what this pandemic means to payers and, ultimately, how manufacturers may be able to help.

1. Different Payers, Different Impacts

For national and regional health plans, there’s been little disruption to their 2020 planning. Currently, they do not plan to delay any 2021/2022 formulary decisions, including inclusion/exclusion lists. P&T committees will continue to meet and evaluate therapies and categories.

However, it’s dramatically different for hospitals, integrated networks, or other closed systems. Day in and day out, their resources are dedicated to the challenges of COVID-19. When and how they will make formulary decisions isn’t top of mind. Unless a manufacturer can help them right now, meetings seem to be on hold.

2. Seeking Answers for the Unknown

So payers, who love modeling and actuarial tables, are seeking answers. How many members will be tested? How many will be hospitalized? What are the costs? What are the long-term health implications?

All they know right now is that COVID-19 has and will continue to put a tremendous strain on their financials. They are already experiencing a loss of revenue, just like many other industries. More unemployment and jobless claims may mean less people are insured, so there’s a concern of reduction in premiums.

In addition, payers have a finite amount of money to care for thousands or millions of members, so funds typically earmarked for other care will be redirected in the short- and mid-term, and possibly into 2021.

From a reimbursement standpoint, we’re seeing that the reimbursement for a Medicare patient is not likely to cover the cost of COVID-19 hospitalization, so most hospitals are going to lose money on every elderly COVID-19 patient they treat. In addition, there are many elective surgeries and other types of interventions that have been postponed or delayed, and hospitals and IDNs will miss that revenue as well.

3. What Other Ways Will Members be Affected?

Beyond the immediate implications of COVID-19, the three topics that are most worrisome to payers are all connected to the other health issues their members may be dealing with:

  • Potential shortages in the supply chain—is distribution or manufacturing being interrupted?
  • The overall well-being of members—are members neglecting their care at this time because they’ve lost their job or can’t see their doctor or have elective surgery?
  • Pharmacy utilization and refills—are members getting their medications as often as they should? Are they rationing their medication, going without, or potentially stockpiling?

How should manufacturers respond? It can be as simple as reinforcing to a payer that your medications will be as accessible as ever. Or help them understand if there may be other medications that are going to be needed more because of COVID-19. What are the other comorbidities that are exacerbated or more worrisome when patients are treated in the hospital at this time?

4. What Value are Manufacturers Bringing?

Payers also told us they want to know how manufacturers are going to respond. We know that 2020 is not going to be a stellar year for any payer. So they will increase their scrutiny on what drugs are covered, how they’re covered, and at what price. It’s too early to identify the therapeutic areas where payers will put pressure on manufacturers, but payers are looking for manufacturers to be proactive. Manufacturers who wait to have conversations, share information, and show value will experience additional tension in the coming months.

We’ve seen payers eliminate some cost sharing to ease the burden on members. Some employers are extending insurance for furloughed and out-of-work employees. What are manufacturers doing? How are you helping with or eliminating co-pays? Are you offering more assistance?

Now is the time to reinforce value. It’s your narrative to share; better to be proactive with it.

5. Overcome the Obstacles of Work-at-Home Orders

Initially, one of the most surprising results of the survey was the large number of payers who said the cancellation of conventions was having a significant impact on their work. Before COVID-19, we’d heard that many conventions were not good uses of time. But now that they’ve been cancelled, they’re missed. Our respondents are realizing how much they rely on events like AMCP, Asembia, and other big industry gatherings.

It’s just one example of how the information flow that is critical to decision-making has been disrupted. As a result, payers:

  • Want more peer interaction to share ideas and learnings.
  • Seek updates on new products and technology.
  • Miss the access to information and resources that they’re used to in the office.

6. Are You Prepared?

As payers work remotely, they are relying heavily on the technology applications that many of us are using, such as WebEx, Zoom, and Skype. They are willing to continue to meet with manufacturers. But are manufacturers ready to use the technology?

Ask yourself:

  • Is every page of every presentation built to be engaging without an account manager in the room?
  • How do your data-heavy tools, such as BIMs, cost calculators, or HEOR presentations, come across on a small screen?
  • How can you include the experts that payers want to hear from and make the dialogue helpful and valuable?
  • Can you share portions of your story in ways that are engaging and memorable?

When we’re on the other side of COVID-19, what will payers remember your company for? How will you use this time to partner with payers to care for their members and provide continuity of care? What value are you bringing now?

(For full survey results click here.)

  • Adrian Garcia

    Adrian Garcia is Senior Vice President, Managed Markets at Syneos Health. Adrian has spent 18+ years overcoming the challenges associated with the payer customer. As the head of Payer & Integrated Health Strategy for GSW, part of Syneos Health Communications, he leads a team focused on supporting both in-market and pre-launch brands.

    • Katherine Seay

      Katherine Seay is EVP, Managing Director, Managed Markets Communications at Syneos Health. Katherine is a dynamic agency leader with expertise in developing integrated payer marketing strategies and tactics. With over 20 years of experience in the pharmaceutical industry, she has encountered many of the access and reimbursement challenges facing marketers today.


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