COVID-19 has been linked to dramatic shifts in demand and extreme uncertainty within payer functions, which in turn could lead to bloated administrative spending in 2021. Executives seeking to right size and create variability in their budgets may want to consider a tried-and-true formula that has not gained traction in the healthcare world: zero-based budgeting.These materials are being provided on an accelerated basis in response to the COVID-19 crisis. These materials reflect general insight based on currently available information, which has not been independently verified and is inherently uncertain. Future results may differ materially from any statements of expectation, forecasts or projections. These materials are not a guarantee of results and cannot be relied upon. These materials do not constitute legal, medical, policy, or other regulated advice and do not contain all the information needed to determine a future course of action. Given the uncertainty surrounding COVID-19, these materials are provided “as is” solely for information purposes without any representation or warranty, and all liability is expressly disclaimed. References to specific products or organizations are solely for illustration and do not constitute any endorsement or recommendation. The recipient remains solely responsible for all decisions, use of these materials, and compliance with applicable laws, rules, regulations, and standards. Consider seeking advice of legal and other relevant certified/licensed experts prior to taking any specific steps.The upcoming budget cycle, due to start or in the works with many payers this month, is likely to be particularly challenging. Chief financial officers potentially have less information on which to base their budgets due to shifts in “drivers of work,” which are the units of demand on payer functions. This shift is a problem created by the COVID-19 crisis. For example, ambulatory claims have dropped (and since risen) significantly, and the volatility in claims and call volumes may continue through 2021. 1 1. Mehrotra A et al., “The impact of the COVID-19 pandemic on outpatient visits: A rebound emerges,” The Commonwealth Fund, May 19, 2020, commonwealthfund.org....