Health insurers are creating a new kind of plan that makes it cheaper for patients to see doctors online, and it shows how the coronavirus pandemic is reshaping the future of healthcare

  • New England insurer Harvard Pilgrim Health Care is partnering with Doctor on Demand to launch a new kind of health plan that encourages members to get virtual primary care. 
  • The new Harvard Pilgrim plan will be offered to large employers in Connecticut and will cost about 5% to 10% less than other plans with similar designs.
  • Humana, Walmart and other health insurers have previously launched virtual primary-care plans and programs for their members or employees.
  • The COVID-19 pandemic has increased the appetite among insurers, employers and patients for virtual primary care.
  • Visit Business Insider's homepage for more stories.

A major New England health insurer is rolling out a new type of health plan with telemedicine company Doctor on Demand that encourages people to get primary care virtually instead of going to a brick-and-mortar doctor's office.

Starting in January, Wellesley, Massachusetts-based Harvard Pilgrim Health Care, which covers roughly 1.1 million people across four states, will allow large employers in Connecticut to offer their workers the new health plan, which is expected to have premiums that are 5% to 10% lower than plans with similar designs.

Members who choose the "SimplyVirtual" plan would see a physician in the Doctor on Demand network for most of their primary care needs and would be referred to in-person specialist care or lab tests, if needed. The out-of-pocket cost for a virtual care visit would vary depending on the employer, but cost-sharing amounts would likely be lower in the virtual plan compared to traditional health plans.

Harvard Pilgrim wanted to offer the new health plan to give people more options and allow them to choose a plan that best fits their lifestyle and needs. While the plan was in the works before the COVID-19 pandemic hit, the insurer expects that more of its members will take advantage of virtual primary care now that many have become comfortable with seeing a doctor through a screen during the coronavirus crisis.

"Once the pandemic started back in March and April, it certainly became very apparent to us that the time was ripe for that particular type of plan," Paul Bartosic, vice president of Harvard Pilgrim's Connecticut market, said in an interview. 

Humana and Oscar Health led the virtual primary care trend

Harvard Pilgrim follows in the footsteps of other big insurers that launched virtual primary-care plans.

National health insurer Humana was the first to partner with Doctor on Demand to create a virtual primary-care plan in mid-2019. Doctor on Demand also launched virtual primary care for some Walmart employees and their families in January this year. Grand Rapids, Michigan-based insurer Priority Health also partnered with the telehealth company to create a similar health plan.

And in July, health insurance startup Oscar Health announced a program to allow members in certain states to get all of their primary care virtually, beginning next year. That program does not involve Doctor on Demand.

Robin Glass, president of San Francisco-based Doctor on Demand, told Business Insider that the company started working with health insurers to launch virtual primary care after telehealth patients began asking to see the same doctor with each visit. Since the pandemic, the interest among health plans and employers in providing virtual primary care has increased.

"The pandemic has been a really catalyzing event for thinking about virtual primary care and these virtual first health plans," Glass said in an interview. "It has just created this huge acceleration in the adoption of virtual care. Even beyond that, it has changed the perspective of a lot of stakeholders in healthcare, probably most significantly consumers, to understand that the care that they get in a virtual platform can actually be just as good as care that they might get in person."

COVID-19 prompted a surge in telehealth visits

Like other telehealth providers, Doctor on Demand has seen a major increase in the use of telehealth during the pandemic, as hospitals closed their doors to non-urgent services and patients stayed home to comply with social distancing recommendations. Glass said the company's telehealth visits as of November are up 75% compared to last year, while behavioral health therapy visits have increased 300%.

Glass said Doctor on Demand physicians working with the virtual-first health plans provide preventive care and chronic disease management, as well as behavioral health care. Many members in the plans would get a remote care kit that includes a blood pressure cuff, thermometer and other tools that allow the patient to take their vitals. They would see the same doctor each time, if they want to.

The plans are often cheaper for patients, insurers and employers because Doctor on Demand can deliver care at a lower cost, as virtual physicians don't have the overhead associated with running and brick-and-mortar practice, Glass said. Plus, the company makes sure to refer its patients to high-quality specialists that deliver the best outcomes and save costs, she said.

How Harvard Pilgrim's virtual primary-care plan will work

Harvard Pilgrim's plan will be available to employers with more than 51 eligible employees in Connecticut. The insurer currently covers about 13,000 members through large employers in the state. 
 
Bartosic said he expects employers to offer the SimplyVirtual plan alongside other traditional health plans. Members that enroll in the plan would choose a Doctor on Demand physician as their primary-care doctor. Some members, such as those younger than 19, would choose a doctor at a brick-and-mortar location, however. 

Doctor on Demand would send the new member a welcome kit and educate the patient on how to use the plan, Bartosic said. Then, whenever the patient needed to see a doctor, the patient would do that via a video visit using the Doctor on Demand app, he said.

Harvard Pilgrim's plan is a health maintenance organization, or HMO, plan, which means that members must see doctors within a specific network. To enroll in the virtual primary-care plan, a member would have to choose a primary care doctor through Doctor on Demand, Bartosic explained.

Members would likely pay a copay for their virtual visits. The cost of those will vary by employer, but generally are less expensive than copayments offered in traditional plans, he said. Bartosic said he expects younger people and those more comfortable with technology to take advantage of the new plan. Members who travel frequently may also prefer virtual primary care, as they could access it it anywhere in the country, he said.
 
So far, Bartosic said Harvard Pilgrim has seen a lot of interest. It has quoted the plan for "dozens" of employers, representing between 2,000 and 3,000 potential members, he said.

Harvard Pilgrim wants to expand the plan to small employers in Connecticut in 2022. It will evaluate whether it will expand the program to employers beyond Connecticut, Bartosic said.

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