Cartoon – Sign of the Times (Blockchain Technology)
Author Archives: henrykotula
Cartoon – Catch a Wave
Cartoon – A Brief History of Healthcare
Cartoon – Patient Centered Care
Tweet of the Day (Healthcare Disruption)
Healthcare and the Proposed Infrastructure Legislation
One of the most important initiatives for President Biden since
taking office in 2021 has been to pass a sweeping infrastructure
bill to improve roads, bridges, water systems, and to make
affordable housing more available to Americans in need, to name a few key
components. While a bill has not yet been passed, initial estimates range from $2.5 –
3.5 Trillion in total spending across all sectors. How will the proposed infrastructure bill
affect healthcare for Americans? Healthcare remains the largest component of
household spending in the U.S. In 2019, Americans spent approximately $3.8 Trillion on
healthcare, or about 18% of the Gross Domestic Product. More importantly, we learned
from the pandemic that healthcare service providers are a critical infrastructure support
network to our nation. What does the infrastructure bill provide to assist with this going
forward?
The largest healthcare components in the infrastructure bill are estimated to be:
- $400 Billion for Home and Community Based care for the disabled and elderly.
According to census, an estimated 20% of the U.S. population will be over 65 by
- Caring for elderly relatives or living independently will become a top concern
for most Americans. Home care is projected to grow by 22.6% in the next decade.
- Lowering the Medicare eligibility age from 65 to 60. If it passes, this will increase the
participants in the Medicare program by an estimated 20 million. - $18 Billion for needed upgrades to VA hospitals. The average age of a VA hospital is
58 years. The private-sector hospitals median age is 11 years old. There are 1,700
VA hospitals and clinics with 69% are more than 50 years old. Additionally, nearly
100 VA sites, mostly in the western part of the country, need seismic correction.
Other President Biden Healthcare Priorities
There are several other healthcare topics that President Biden has added to his Agenda.
• Expand coverage to Medicaid at the state level to provide access to almost 5
million additional individuals
• Lowering drug costs for consumers by requiring drug companies to negotiate
with Medicare, limiting drug price increases and import drugs to save costs
• Ending surprise billing - Expand funding for mental health care through the ACA and bring parity between mental health and other healthcare services
- Tax credits for eligible families who enroll in coverage through the Marketplace
- Unfortunately, while these estimates may continue to change between now and when a final bill is passed, healthcare is not a meaningful part of the infrastructure bill. Given our recent experience during the pandemic with hospital capacity being overloaded, one would have thought that the infrastructure bill would have addressed this critical shortfall.
Americans’ medical debt tops $140B, study finds
Collection agencies held $140 billion in unpaid medical debt in 2020, according to a study published July 20 in JAMA.
Researchers examined a nationally representative panel of consumer credit reports between January 2009 and June 2020. Below are four other notable findings from their report.
- An estimated 17.8 percent of Americans owed medical debt in June 2020. The average amount owed was $429.
- Over the time period studied, the amount of medical debt became progressively more concentrated in states that don’t participate in the Affordable Care Act’s Medicaid expansion program.
- Between 2013 and 2020, states that expanded Medicaid in 2014 experienced a decline in the average flow of medical debt that was 34 percentage points greater than the average medical debt flow in states that didn’t expand Medicaid.
- In the states that expanded Medicaid, the gap in the average medical debt flow between the lowest and highest ZIP code income levels decreased by $145, while the gap increased by $218 in states that did not expand Medicaid.
Pay cut forces Health Partners to lay off 560 workers
Health Partners, one of the largest home healthcare providers in Michigan, laid off 560 employees at the beginning of July, including nurses, nursing assistants, therapists and direct care workers, according to Crain’s Detroit Business.
The layoffs occurred July 1 and happened as the Bingham Farms-based company is winding down business. The job losses are attributed to a 2019 state law capping Health Partners’ payment rates at 55 percent of what it bills insurance companies to care for injured motorists, said Chad Livengood, a senior editor at Crain’s Detroit Business.
Health Partners owner John G. Prosser II, who has been in the home health business for decades, said the company couldn’t absorb the losses from the new fee schedule, which cuts payments by 45 percent, according to Crain’s.
Other home healthcare companies in Michigan haven’t met the same fate as Health Partners because they rely more heavily on Medicaid, workers’ compensation insurance or private payers, according to the report.
Read more here.
18 health systems with strong finances
Here are 18 health systems with strong operational metrics and solid financial positions, according to reports from Fitch Ratings, Moody’s Investors Service and S&P Global Ratings.
1. Altamonte Springs, Fla.-based AdventHealth has an “Aa2” rating and stable outlook with Moody’s and an “AA” rating and a stable outlook with Fitch. The system has strong profitability, solid liquidity and presence in several high growth markets, Fitch said.
2. St. Louis-based BJC HealthCare has an “AA” rating and stable outlook with S&P and an “Aa2” rating and stable outlook with Moody’s. The health system has a leading market share and a highly regarded reputation, particularly for its flagship hospitals that are affiliated with Washington University School of Medicine in St. Louis, S&P said. The health system has consistently produced stable earnings and cash flow, even during the COVID-19 pandemic, according to the credit rating agency.
3. Dallas-based Children’s Health System of Texas has an “AA” rating and stable outlook with Fitch. The system has robust operating profitability, good expense management and strong EBITDA margins, according to Fitch.
4. Cleveland Clinic has an “Aa2” rating and stable outlook with Moody’s. The system’s international brand will allow it to grow revenue outside of the northeast Ohio market and offset the effects of the pandemic on patient volume, Moody’s said. The credit rating agency expects the system to maintain good cash flow margins.
5. Evansville, Ind.-based Deaconess Health System has an “AA” rating and stable outlook with Fitch. The health system has strong operating performance and an expanding footprint in a stable and economically diverse service area, Fitch said. Investments in core service lines should help support patient volume growth, according to the credit rating agency.
6. Durham, N.C.-based Duke Health has an “AA” rating and stable outlook with Fitch. The system has a strong clinical reputation and a solid balance sheet with substantial liquidity reserves, Fitch said.
7. Pinehurst, N.C.-based FirstHealth of the Carolinas has an “AA” rating and stable outlook with Fitch. The health system has a strong financial profile and stable operating performance, despite disruption from the COVID-19 pandemic, Fitch said. The health system’s revenue in the first quarter of fiscal 2021 rebounded to levels close to historical trends, according to the credit rating agency.
8. Milwaukee-based Froedtert Health has an “AA” rating and stable outlook with Fitch. The system has a solid market position and a robust liquidity position, Fitch said. The credit rating agency expects Froedtert to maintain robust operating cash flow levels.
9. Indianapolis-based Indiana University Health has an “Aa2” rating and stable outlook with Moody’s and an “AA” rating and positive outlook with Fitch. Cost controls and patient volume will help the system sustain strong margins and liquidity, Moody’s said.
10. IHC Health Services, the borrowing group of Salt Lake City-based Intermountain Healthcare, has an “Aa1” rating and stable outlook with Moody’s. Intermountain has a leading statewide market position, low debt levels and strong cash levels, Moody’s said. The credit rating agency expects Intermountain will sustain strong margins and cash levels.
11. Falls Church, Va.-based Inova Health System has an “Aa2” rating and stable outlook with Moody’s. The system has a strong financial profile, and Moody’s expects Inova’s balance sheet to remain exceptionally strong.
12. Rochester, Minn.-based Mayo Clinic has an “Aa2” rating and stable outlook with Moody’s. The health system has strong balance sheet measures, an excellent market position and strong patient demand at its three academic campuses in Minnesota, Arizona and Florida, Moody’s said. The credit rating agency expects strong patient demand and steps taken by management to allow Mayo to maintain adequate cash flow and strengthen balance sheet measures.
13. Traverse City, Mich.-based Munson Healthcare has an “AA” rating and stable outlook with Fitch. The system has strong leverage and liquidity, Fitch said. The credit rating agency expects Munson to maintain solid operating cash flow margins.
14. Tupelo-based North Mississippi Health Services has an “AA” rating and stable outlook with Fitch. The system has a leading market share in a large 20-county service area and strong adjusted leverage metrics, Fitch said.
15. Chicago-based Northwestern Memorial HealthCare has an “Aa2” rating and stable outlook with Moody’s and an “AA+” rating and stable outlook with S&P. The health system had strong pre-COVID margins and liquidity, Moody’s said. The credit rating agency expects the system to maintain strong operating cash flow margins.
16. Columbus-based OhioHealth has an “Aa2” rating and stable outlook with Moody’s and an “AA+” rating and stable outlook with S&P. The system has a leading market position and opportunities for service line expansion, Moody’s said. The credit rating agency expects the system’s strong liquidity to provide ample cushion for volatility in investment returns.
17. Stanford (Calif.) Health Care has an “AA” rating and stable outlook with Fitch. The system has broad reach and is a clinical destination for high acuity services, Fitch said. The credit rating agency expects the system to sustain strong EBITDA margins.
18. Iowa City-based University of Iowa Hospitals & Clinics has an “Aa2” rating and stable outlook with Moody’s. The credit rating agency expects the system to maintain strong operating performance and cash flow. The system benefits as the only academic medical center in Iowa, according to Moody’s.
A Fourth Wave of COVID-19 Is Brewing in the U.S. Is There Enough Time to Stop It?
With every passing day, the United States appears more likely to be on the cusp of a dreaded fourth wave of COVID-19 infections, even as the percentage of fully vaccinated Americans inches toward 50%. In the past two weeks, the number of average new daily cases has more than doubled, from 13,200 on July 4 to more than 32,300 on July 18, a surge that harbors grim reminders of the fronts of the second and third waves in the summer and fall of 2020.
But on closer inspection, this surge looks significantly different than those we have seen in the past—and may very well be worse than it looks on the page.
The coronavirus pandemic has never, even in its worst heights last winter, struck the U.S. uniformly. Instead, it has wandered from eruptions in specific urban areas to suburban and rural counties and then back again, like a persistent hurricane. Now, as the gap between states’ completed vaccination rates widens—Alabama has vaccinated just 33.7% of residents, compared to nearly 70% in Vermont—the per capita rate of new cases has clustered in a handful of regions where a majority of adults remain unvaccinated even as reopening continues apace.
To draw on my amateur oceanography, the current crest resembles less a wave than a rip tide, with surges of current inundating several hotspots while the remainder of the country remains blissfully unaware (or unwilling to admit) that the pandemic is not remotely over. The upshot is that local data, rather than state- or nationwide-level figures, now paint the most accurate picture of the current state of the outbreak.
“State-wide cases don’t tell the entire story. We need a finer-toothed comb,” says Jennifer Nuzzo, the lead epidemiologist for the Johns Hopkins University Testing Insights Initiative.
As Nuzzo notes, the most recent documented outbreaks are more concentrated in rural areas than those of the worst spikes over the past 16 months (though the virus didn’t spare any corner of the country). What appears to be different now, even within more rural regions, is a blossoming of outbreaks that are at the moment highly clustered, particularly along the border between Arkansas and Missouri as well as northeast Florida and southeast Georgia.
But any such observation comes with the same caveat that we on the Numbers Beat have been striving to communicate since the beginning: The number of cases is contingent on the number of people being tested for the virus, a figure that can only underestimate the true picture, not exaggerate it.
Let’s recall: A year ago, COVID-19 skeptics, including then-Vice President Mike Pence, were attributing a spike in cases at the time to an increase in testing, a claim that was easily debunked. Now we face the opposite question: As the number of weekly tests has plummeted, taking a back seat to vaccination, and with the sense of urgency abating (for now), is the situation in fact worse than it appears?
“I don’t worry that we are missing the severe cases,” including when a patient is hospitalized, Nuzzo says. “It’s everybody else I worry about. We have turned our telescope to a different part of the sky.”
Murray Côté, an associate professor of health policy and management at Texas A&M University, agrees. “I still think we’re missing a chunk” of positive cases, he says. “It’s a confluence of things. We don’t have the testing facilities we used to have [earlier in the pandemic].” That chunk, both Côté and Nuzzo say, is likely made up of people who are experiencing mild or no symptoms, but can still be part of a transmission chain.
I last spoke with Côté in June 2020 when unwinding Pence’s claim that the summer surge was a product of more testing. Our conversation this time felt both reversed, as we were discussing a possible under-calculation of reality, as well as strangely familiar, because a year ago, we were seeing a new surge amid a widespread relaxation of safety measures—not unlike the freedom from safety measures like maskless dining we currently enjoy.
“We’re behaving exactly the same way as we did last year,” Côté says. To refresh your memory: Around this time in 2020, the U.S. had a brief moment where cases began to drop. Some Americans started to ease their social distancing and mask wearing, and it led to both a summer surge and, after another lull, the massive winter spike that turned out to be the worst stretch of the global outbreak to hit any country in the world. What’s different now is that this time we have highly effective vaccines—but, while inoculation can protect individuals, vaccination rates in many communities across the U.S. remain too low to prevent fresh outbreaks.
In the heady days of spring, 2021, many states began reducing the frequency of their reports on new cases to every few days or once a week. That was a foolish mistake when, even with a massive reduction in testing, the seven-day rolling average of new cases never dipped below 10,000 at the national level. Given that the best-case scenario—even before the emergence of the Delta variant—was a reduction of cases and deaths to endemic levels for years to come, states must pair their desperate attempts to vaccinate more individuals with a renewed focus on surveillance and contact tracing.
For now, the best way to prevent the current spikes from becoming a proper fourth wave is vaccination (which, even if cases continue to rise, can help prevent hospitalizations and deaths), increased surveillance, and a return to mitigation measures. Indeed, Los Angeles County on Sunday reinstituted mandatory mask-wearing in businesses and public areas, a major rollback after the U.S. Centers for Disease Control and Prevention said on May 13 that fully vaccinated individuals could shed their masks in many scenarios. Unless states can rapidly revive widespread and easily available testing, L.A. will be far from the last county to ask residents to mask up once again.
HENRY KOTULA 