This week we bring a variety of newsworthy notes that may have been overlooked with today’s news moving so quickly. Enjoy!
When COVID-19 first hit the US, Oscar Health called some customers with a simple question: Do you have enough to eat? Food and nutrition have become a bigger focus for health insurance companies as they look to expand their coverage beyond the care that happens in the health care system. More plans are paying for temporary meal deliveries and some are teaching people how to cook and eat healthier foods. Insurers are treating food as a form of medicine that can help patients reduce blood sugar or blood pressure levels and stay out of expensive hospitals. This concept is still relatively small and happening mostly with government-funded programs like Medicaid or Medicare Advantage. We believe this trend will continue to grow.
With this announcement, the company is exiting a business it entered in 1957.
This transaction represents the next step in the process of deploying capital out of spreadbased risks
Said CEO Tom Wilson. The most significant impact of this move is to reduce and simplify Allstate’s investment portfolio. Some may recall that it was this life insurance unit, and riskier investments that come with it compared to the auto and home insurance, that led to massive losses during the financial crisis of 2008. Since the financial crisis, private-equity, asset-management and other types of financial firms have bought up blocks of life-insurance policies and annuities. Ultralow interest rates have prompted much of the activity, hurting insurers’ profits.
Earlier this year, the Equal Employment Opportunity Commission issued proposed wellness program rules. If the proposed rules become effective, they will significantly restrict the ability of employers to provide incentives to participate in wellness programs. While the proposed rules may change before they are finalized, employers maintaining wellness programs should pay close attention and be prepared to redesign their wellness strategies.