Disaster Looms As Millions Of Americans Set To Lose Employer-Sponsored Health Insurance

With a record 3.3 million people filing for unemployment due to the Chinese coronavirus pandemic - the largest number of claims ever recorded in a single week since October, 1982 - millions of Americans stand to lose their employer-sponsored health insurance when they might need it the most, according to Bloomberg.

According to the Kaiser Family Foundation, almost half of Americans receive healthcare coverage through their employer - forcing those who have been laid off to scramble for alternatives. Anyone suffering from a lack of income who has been covering their own plans, including small business owners and self-employed individuals, are also undoubtedly feeling the heat right now as well.

A test is required to determine whether a person has Covid-19, the disease the new coronavirus causes. Serious cases can send people to the emergency room and in some cases to the intensive care unit, a costly out-of-pocket expense.

There are fallbacks for people who find themselves out of work. A program known as Cobra allows some to continue to purchase the insurance they had through their employer, though typically at a much higher out-of-pocket cost. Some may be eligible for Medicaid. And the Centers for Medicare and Medicaid Services is considering reopening the Affordable Care Act exchanges; generally, those health plans can be purchased only during an open-enrollment period late in the year. -Bloomberg

The sword cuts both ways as well - as private insurers who carefully calculate premiums based on anticipated annual expenses are about to get slammed with a spike in expenses out of left field, according to the report.

CVS Health Corp, which acquired insurer Aetna in 2018, described the oncoming train in a Thursday regulatory filing - saying that the situation is developing rapidly and that the damage to their business will depend on the severity and duration of the pandemic, as well as its effect on the economy and how state and local governments respond.

"Those primary drivers are beyond our knowledge and control, and as a result, at this time we cannot reasonably estimate the adverse impact COVID-19 will have on our businesses, operating results, cash flows and/or financial condition, but the adverse impact could be material," the company said.

Meanwhile, Blue Cross Blue Shield Association and America's Health Insurance Plans sent recommendations to Congress last week aimed at boosting enrollment and covering costs which insurers currently don't handle. The proposal was not included in Wednesday's stimulus bill.