UnitedHealthcare (UHC) this week became the latest major insurer to waive members’ cost sharing for COVID-19 treatments. The health insurer said it would waive the associated costs for members in its fully insured commercial, Medicare Advantage, and Medicaid plans.
added that it’s working with interested self-funded employer plans to offer the
announced similar steps, saying it would cover the cost-sharing for COVID-19
treatment through May 31 for its Medicare, Medicaid, individual market and
fully insured employer plans. The insurer also said it was “strongly
encouraging” its self-funded employers to adopt the waivers.
has also taken other steps similar to its peers in the industry, such as
waiving the cost-sharing for testing and tele-health, and easing prescription limits.
Cigna and Humana all previously announced they would waive members’
cost-sharing for COVID-19 treatment. These insurers also waived copayments and
other cost-sharing for testing and telehealth visits.
health plans are taking similar steps. Florida Blue announced Tuesday it would
waive cost-sharing for treatment, as did Harvard Pilgrim Health Plan.
The spread of the coronavirus and COVID-19 – and how governments, businesses, and individuals are dealing with it – raises many issues relevant to property/casualty insurers and their customers.
Triple-I has launched a webpage
to help readers find what they need from the information we gather and curate.
The issues we track range from operational challenges posed by the virus to
likely impacts on claims and losses to the possible introduction of legislative
and regulatory solutions that might affect insurance underwriting and pricing.
We discuss these multi-faceted issues and impacts from our
position as a trusted source of unique, data-driven insights on insurance. The
page will have links to Triple-I reports and presentations on the topic, and
links to many of our blog posts grouped by the following categories:
compensation claims related to COVID-19 will be paid is a question to be
answered case by case and state by state.
The world has seen numerous epidemics whose impact on public health is well documented, so you might expect to find guidance on compensability from these experiences. But according to the National Council on Compensation Insurance (NCCI), “You would be hard pressed to find meaningful information on how or even if the workers compensation system was affected” by the SARS, H1N1, Ebola, and Zika outbreaks.
Workers comp insurance typically covers employers
for employee claims regarding “bodily injury by accident or bodily injury by
disease.” Many state statutes, however, exclude “ordinary disease of life.”
While some occupations – for example, health care
workers and first responders – might be said to have a higher probability than
others for exposure to COVID-19, whether the disease is compensable under
workers comp is uncertain.
“’Would time away from work during recovery be considered ‘temporary disability’,”’ NCCI asks, “or is it just normal ‘sick time’?”
Guaranteed benefits for some
Workers’ comp insurers in at least two states have said they will guarantee benefits for health workers and first responders.
Kentucky Employers Mutual Insurance Co. said it will
pay wage-replacement benefits for any first responder or employee in the
medical field who is quarantined because of direct exposure to a person
diagnosed with COVID-19. The announcement follows a decision by the Washington State
Department of Labor and Industries to pay wage-loss and medical treatment
expenses for any health care worker or first responder who is quarantined
because of coronavirus exposure. Washington operates a monopoly workers comp
system, so that policy affects every employee covered by the state system.
It remains to be seen if other states will take the
same measures relative to workers comp. For general health insurance, however, NCCI
says at least 10 states have issued mandates to cover COVID-19. The mandates
vary, but they include coverage for testing and visits to emergency rooms or urgent
care facilities either in-network or out-of-network without deductibles or
If expanded to more states, NCCI says, these mandates
could limit workers comp claims in cases where only testing or quarantine are
Cyberattacks on hospitals can lead to increased death rates among heart patients, recent research suggests. This research emerges as attacks on health facilities are reported to have increased 60 percent in 2019.
Researchers at Vanderbilt University‘s Owen Graduate School of Management drilled down into Department of Health and Human Services records on data breaches from more than 3,000 Medicare-certified hospitals. They found that, for facilities that experienced a breach, the time for suspected heart attack patients to receive an electrocardiogram (ECG) increased by more than two minutes.
When seconds count
The study focused on the impact of remediation efforts on health care outcomes following a data breach. It found that common remediation approaches, such as additional verification layers during system sign-on, can “delay the access to patient data and may lead to inefficiencies or delays in care.”
“Especially in the case of a patient with chest pain,” the report says, “any delay in registering the patient and accessing the patient’s record will lead to delay in ordering and executing an ECG.”
The researchers found that “a data breach was associated with a 2.7-minute increase in time to ECG three years after the breach.”
A bit over two minutes may not seem like much – but during a coronary or a stroke it can be the difference between life and death.
Vanderbilt’s research was based on data collected before ransomware attacks against health care facilities became common. The authors caution that such attacks – in which systems or data are held hostage until a ransom can be paid – “are considered more disruptive to hospital operations than the breaches considered in this study.”
The medical sector is the seventh-most targeted industry, according to a report by internet security firm Malwarebytes, based on data gathered between October 2018 and September 2019. But Malwarebytes warns that attacks on this sector are on the rise.
“Threat detections have increased for this vertical,” the report says, “from about 14,000 healthcare-facing endpoint detections in Q2 2019 to more than 20,000 in Q3, a growth rate of 45 percent.”
Comparing all of 2018 against the first three quarters of 2019, Malwarebytes said it has observed a 60 percent increase in such attempted intrusions.
“If the trend continues,” Malwarebytes reports, “we expect to see even higher gains in a full year-over-year analysis.”
You’re more likely to die from being attacked by a dog than in an airline accident (see chart).
And yet, according to a recent Allianz Global Corporate & Specialty (AGCS) report, the aviation sector’s insurance claims continue to grow in number and size.
The report – Aviation Risk 2020 – says 2017 was the first in at least 60 years of aviation in which there were no fatalities on a commercial airline. The year 2018, in which 15 fatal accidents occurred, ranks as the third safest year ever.
Of more than 29,000 recorded deaths between 1959 and 2017, the report says, fatalities between 2008 and 2017 accounted for less than 8 percent – despite the vast increase in the number of people and planes in the air since 1959.
So, what gives?
Safety is expensive
Some of the reasons for the increased claims are good ones: Safer aircraft cost more to repair and replace when there are problems.
The report analyzed 50,000 aviation claims from 2013 to 2018, worth $16.3 billion, and found “collision/crash incidents” accounted for 57 percent, or $9.3 billion. Now, this may sound bad, but the category includes things like hard landings, bird strikes, and “runway incidents.”
The AGCS analysis showed 470 runway incidents during the five-year period accounted for $883 million of damages.
Engine costs more than the plane
Today’s aircraft contain far more sophisticated electronics and materials than those flying in the 1960s. When they bump into each other or come down too hard, they cost more to repair.
“We recently handled a claim where a rental engine was required while the aircraft’s engine was repaired,” said Dave Watkins, regional head of general aviation, North America, at AGCS. “The value of the rental engine was more than the entire aircraft.”
When entire fleets have to be grounded – the report cites the 2013 grounding of the Boeing Dreamliner for lithium-ion battery problems and the more recent fatal crashes involving the Boeing 737 Max – costs can really soar. Boeing reportedly has set aside about $5 billion to cover costs related to the global grounding of the 737 Max.
Even after a fix is found, the task of retrofitting a fleet takes considerable time – and, in the aviation industry, time truly is money.
Liability awards take off
Compounding the claims associated with the costs of safer flight, the report says, liability awards have risen dramatically.
“With fewer major airline losses,” Watkins said, “attorneys are fighting over a much smaller pool and are putting more resources into fewer claims, pushing more aggressively for higher awards.”
Today’s aircraft carry hundreds of passengers at a time. With liability awards per passenger in the millions, a major aviation loss could easily result in a liability loss of $1 billion or more.
Electronic cigarettes have been marketed as a healthier alternative to smoking tobacco, but a recent outbreak of lung disease linked to e-cigarettes shows that smoking is unsafe in any form, and insurers are cautioned to review their books of business for exposures to e-cigarettes.
The Centers for Disease Control (CDC) has reported 12 deaths and 805 cases of lung injury linked to e-cigarettes (or vaping) as of this week. Of the 373 cases where data on the patients was available, about three-quarters were male, two-thirds were 18 years to 34 years old and 16 percent were younger than 18 years
The cause of the illnesses has not been linked to any specific ingredients or devices. And while health officials continue to investigate, people are cautioned to refrain from using e-cigarettes altogether, and particularly to stay away from vaping liquids or devices sold on the street.
And if the outbreak of lung disease is not bad enough, e-cigarette batteries have been known to explode, causing serious injuries and a few deaths. A study from George Mason University estimated there were more than 2,000 visits to U.S. emergency rooms from 2015 to 2017 for e-cigarette burns and explosion-related injuries.
In a recent blog post, Tim Fletcher, Senior Emerging Issues Specialist at Gen Re suggests that in response to the situation insurers should review their small commercial retail book to determine whether any are selling e-cigarettes. Such retailers could include convenience stores, gas stations, and liquor stores. The blog lists several forms and ISO exclusions for e-cigarettes.
The Gen Re blogger reminds insurers that the duty to defend exists in all standard CGL occurrence forms with the potential to incur uncapped defense costs.
In a previous article, we discussed how personal insurance policies address communicable diseases and epidemics. In this article, we’ll look at how commercial insurance policies handle these issues.
Between 1918 and 1919 the so-called Spanish influenza pandemic* killed at least 50 million people worldwide and infected about 500 million people – or about 1/3 of the entire world’s population at the time.
While the Spanish flu’s destructiveness has been an outlier over the last several decades, epidemics and pandemics on a smaller scale do still happen (avian flu, swine flu, Ebola, etc.).
How could disease outbreaks impact commercial property and general liability insurance?
In this article, we discuss how personal insurance policies address communicable diseases and epidemics. In a later article, we’ll look at how commercial insurance policies address these issues.
Measles are back with a vengeance. It’s gotten so bad in one New York county that the local government tried to ban unvaccinated children from public spaces.
Little known fact to people outside the insurance world: many personal insurance policies address communicable diseases and epidemics. Let’s walk through some of them.
Homeowners liability insurance: probably not covered
If you crack open your handy HO-3 standard homeowners policy and flip to Section II – Liability Coverages, you’ll notice that the transmission of a communicable diseases that causes any bodily injury or property damage is not covered by the policy. What this basically means is that if you (the insured) cause someone to get hurt (i.e. sick) via a communicable disease, whether you knew you were sick or not, then the policy won’t cover you for any liability if you get sued.
So if someone without a measles vaccination throws a party and ends up getting several guests sick, that person’s homeowners policy probably won’t cover any liability arising out of their actions. Doubly so if the person did this purposely: intentional acts are excluded from pretty much every insurance policy on earth.
Personal liability umbrella: probably not covered, but it depends
A personal liability umbrella policy is basically an extra layer of liability insurance. It will cover some types of liability your homeowners insurance excludes – and will also cover higher payments, sometimes up to $1 million (homeowners is often limited to $300,000).
Personal umbrella policies will also often exclude liability arising out of the transmission of a communicable disease. But not always, since what constitutes a communicable disease often depends on the specific policy. Some policies only exclude sexually transmitted diseases; others will exclude any communicable disease.
Travel insurance: could be covered, depending on the situation
Travel insurance policies can vary dramatically, depending on the insured’s needs. Two of the more common coverages are for trip cancellation and emergency medical treatment.
Will travel insurance cover you if a trip gets cancelled due to an epidemic or pandemic? Again, depends on the policy, but probably not. Many travel policies will exclude losses caused by disease outbreaks.
What if you get sick and need to cancel your trip? Unfortunately, you’re probably not covered if you got sick because of an epidemic. But for other diseases, you could be covered, depending on the insurer and a whole laundry list of conditions. For example, a sickness that would be covered often requires that the sick person be so ill that they can’t travel (a mild cough won’t pay out); the sick person is also often required to have a medical professional confirm that they were, in fact, too sick to travel.
If you have emergency medical treatment coverage, then you’ll be covered for any covered medical care, including illness. However, these kinds of policies can get very complicated; it’s important to talk to your agent to make sure you are getting the coverage that you need.
Most recently, New Jersey legislators reportedly announced a bill that would permit recreational marijuana. If signed into law, New Jersey would join ten other states and D.C. that currently permit recreational marijuana. More than 30 states and D.C. also permit medical marijuana programs of some kind.
But as legalization spreads, concerns about driving under the influence of marijuana continue unabated.
Today, the I.I.I. has published a report that examines the current state of the issue.
“A rocky road so far: Recreational marijuana and impaired driving” dives into the hazy questions surrounding marijuana impairment: its effects on driving abilities, how traffic safety might be impacted, and how states are grappling with the issue of “stoned driving.” (Download the report here.)
Unfortunately, there are still many unknowns when it comes to stoned driving. Marijuana impairment degrades cognitive and motor skills, of course – but marijuana-impaired driving is an evolving issue with many questions and few concrete answers. Legalization is still relatively recent. Data are still being gathered. How to understand and measure marijuana impairment are still open questions.
Do the rates of marijuana-impaired driving increase following recreational legalization? Answer: probably. Does marijuana-impaired driving increase crash risks? Answer: probably, but we still don’t concretely know to what degree. What about traffic fatalities – do those increase after legalization? There’s evidence that traffic fatalities could increase following legalization, but there is still quite a bit of discussion about this issue.
There is active research, discussion and debate being conducted to answer these and other questions. As more states legalize recreational marijuana, forthcoming answers will become ever more critical to help best guide public policy and traffic safety initiatives.
A friend of mine likes to say that New York City is so expensive that just leaving your apartment will cost you $20. It cost me $100 to leave my apartment the other day – in fines for leaving a piece of furniture by the curb on a day not designated for “bulk trash removal.”
I get it: leaving bulky trash all over the sidewalk for days on end is an antisocial thing to do, especially in a crowded city. I wouldn’t have felt great about myself if a kid had somehow tripped and hurt herself on my discarded garbage.
My landlord could also have landed in legal trouble had that happened. That’s because NYC law makes property owners responsible for keeping sidewalks “reasonably safe” and clear of debris (with some exceptions). “Reasonably safe” also includes shoveling snow and ice – something I’m always grateful for after the occasional NYC blizzard.
New York is not alone. Many jurisdictions across the country put the onus on property owners for maintaining sidewalks, including clearing snow and ice (even if the sidewalks are city property).
If you’re a property owner, it’s important to check your city or homeowner’s association codes to see who is responsible for what. If you rent, you should also check your lease. Some leases make tenants responsible for clearing snow from sidewalks.
Let’s say you do live in a city where you’re responsible for keeping the sidewalk safe. What happens if someone slips and suffers injuries on your sidewalk?
Homeowners insurance could provide some coverage. Depending on the case, there could be coverage for liability and for some medical payments to the injured person. But an insurance company could deny coverage if the homeowner knew about an unsafe sidewalk and did nothing to fix it.
And liability payments can get expensive quickly. That’s why some people will also buy optional “personal umbrella liability coverage,” which has a higher payment cap than standard homeowners.
Renters insurance also provides liability coverage. But whether the tenant or landlord is responsible for a slip and fall on a sidewalk would depend on the terms of the lease and local ordinances.
The upshot is: check if you’re responsible for the sidewalks outside your home. It’s also a good idea to chat with your insurance agent to see if you have the appropriate coverage to protect you from liability costs.