Elevanta Health Focused on Helping Your Business Navigate Unexpected Challenges

Two years after life in the U.S. and around the world was disrupted by the coronavirus pandemic, we can still be surprised by the rippling effects it created.

At the start of the pandemic, as businesses and other institutions scaled back or closed operations, few people foresaw how the labor market and supply chains would be so drastically affected. Now, it’s clear that the ongoing threat of COVID-19 made an already acute shortage of labor even worse, and that the supply chains ensuring the flow of materials and products throughout the world were not designed to withstand the strain of a dangerous virus with global spread. Untangling the kinks is not easy and takes time and effort.

The basic law of supply and demand dictates that when products and services are plentiful, their price is low. As they become scarcer, their prices increase, and we are seeing that with consumer inflation levels rising higher and faster than at any point in the last 40 years. Employers are finding it necessary to boost salaries to attract workers, and they are finding the prices they pay for the supplies they need to operate getting higher. As a result, it’s no shock that prices for the goods and services they produce are rising as well.

The pandemic’s economic ripples have now reached the health care industry, which is suffering an acute labor shortage, particularly among nurses. The exodus of people from the profession due to stress and burnout has created a crisis. As health care companies struggle to staff their facilities, they are increasingly relying on travel nurses, who work in short-term roles at hospitals and clinics around the world, to fill the gaps. Travel nursing grew 35% in 2020 and is expected to grow 40% more in the future, according to The Washington Post. Typically, travel nurses are employed by independent staffing agencies contracted by health care companies, and they can earn between $5,000 and $10,000 per week, far more than the average staff nurse salary of $73,300 per year, or $1,400 per week.

This combination of an increase in salaries and higher costs for medical equipment and supplies means that the health care industry is not immune to the inflationary pressures affecting the economy nationwide. Because of the unique features of the health care industry – in which services, prices, reimbursement rates, labor contracts and other input factors are set in contracts years in advance – higher rates are just now being felt by health insurance companies and their customers.

In addition to increased health care costs, it is estimated that four of 10 Americans delayed medical care during the COVID-19 pandemic. Preventive cancer screenings dropped 86% for colon cancer and 94% for breast and cervical cancer following the pandemic. This delay in medical care has led to a generally unhealthier population with conditions that are more serious and costly than they would have been had they been treated in a timelier fashion.

Those of you who rely on Elevanta Health to provide your employees with health insurance options have seen that we are not immune to these economic waves. This year, our average annual health insurance renewal rate increase was 9%, a figure much higher than what we have typically experienced. For instance, in 2021 Elevanta Health had an overall average increase of 1%. In fact, 68% of our members had no increase to their rates last year, giving them a two-year average of just 4.5% per year.

As our economy and the health care industry struggle with the inflationary challenges caused by the pandemic along with increased costs due to the deferral of care, this year’s increase is an unfortunate side effect. However, the Elevanta Health program remains financially stable and will withstand these headwinds. Elevanta Health continues to offer a large menu of high-quality medical plans – all using the national Blue Cross Blue Shield network of providers – that can meet the unique needs of most businesses, and we also continue

by CHRISTY WILLIAMS

to provide the back-office support that removes the burden of program administration from franchisees suffering their own labor shortages.

Navigating the turbulent waves of the pandemic hasn’t been easy, but we’ve done so with the financial condition of our members as our No. 1 priority. In May of 2020, at the height of pandemic shutdowns, we demonstrated our commitment to Elevanta Health clients as we offered $2 million in participation refunds and premium deferrals. We have also developed many programs, such as Teladoc, Livongo Diabetes Management and PaydHealth, that can decrease costs while providing high-quality services to your employees. The more that your employees use these services, the more everyone’s total costs, including premiums, are reduced over time.

If we’ve learned anything over the last two years, it’s that there will always be unexpected challenges requiring us to adapt and grow to overcome them. Rest assured that Elevanta Health will always be your partner in this journey, focused on keeping your business on track and moving forward. n