The medical cases that are bad news to self-funded plans are also bad news to stop-loss insurers. So the latest report by stop-loss insurer Sun Life Financial on the top 10 catastrophic health conditions it sees is instructive for self-funded plans. Two categories of cancer, end-stage renal disease and two categories complications related to newborns together constituted 42 percent of all stop-loss claim payments that Sun Life Financial paid from 2010 through 2013, the payer reported.
The most costly three conditions — malignant neoplasm, ESRD and leukemia/ lymphoma/multiple myeloma — represented 33.5 percent of all stop-loss claims payments that Sun Life Financial made from 2010 to 2013. Reimbursements for those three were $671 million out of a total of $2 billion in total stop-loss claims Sun Life Financial paid in those four years. Conditions six through 10 comprised about 11 percent of claim payouts.
1) malignant neoplasm (cancer), 17.5 percent;
2) chronic/ESRD (kidneys), 8.2 percent;
3) leukemia/lymphoma, and/or multiple myeloma (cancer), 8 percent;
4) congenital anomalies (conditions present at birth), 4.3 percent;
5) disorders relating to short gestation and low birth weight (premature births), 3.5 percent;
6) cerebrovascular disease (brain blood vessels), 2.5 percent;
7) complications of surgical and medical care, 2.5 percent;
8) congestive heart failure, 2.3 percent;
9) pulmonary collapse/respiratory failure, 2.3 percent; and
10) septicemia (infection), 2.1 percent.
Million-dollar Claims Spurred by Health Care Reform
The payer reported a significant increase in claims that $1 million or more. Such claims went from just two in 2010 to 22 in 2013. 2013 saw a 144-percent rise in million-dollar claims over 2012.
Sun Life Financial predicts this trend will continue, because health care reform requires that dependents be covered to age 26, it reported. Reform’s shorter waiting-period rules; its removal of annual and life-time limits and guaranteed reissue provisions also are likely to ensure $1-million claims remain high. Perhaps as a result, in 2013, 71 percent of the million-dollar stop-loss claimants were dependent children.
Most expensive conditions
The conditions with the most $1-million claims were premature deliveries/congenital conditions with nearly 29.3 percent; transplants with 12.2 percent; and leukemia with 7.3 percent. Hemophilia was another condition that generated very expensive reimbursements.