Tenet Healthcare, a 65-hospital network based in Dallas, received federal grants and loans to help offset financial damage caused by the COVID-19 pandemic, according to the company’s presentation at the UBS Global Healthcare Conference on May 19.
Like other hospital networks across the nation, Tenet took a financial hit from canceling non-emergent and elective procedures to save capacity and supplies to treat COVID-19 patients. The company estimates that COVID-19 negatively impacted its adjusted earnings before interest, taxes, depreciation and amortization by about $125 million in the last few weeks of March.
To help navigate the financial pressures, Tenet has received funds from the $175 billion in relief aid Congress has allocated to hospitals and other healthcare providers to cover expenses or lost revenues tied to the COVID-19 pandemic. As of May 19, Tenet said it had received about $517 million in federal grants, which do not have to be repaid as long as the company meets the terms and conditions of receiving the relief aid.
Tenet also applied for and received approximately $1.5 billion in advance Medicare payments, which it must begin repaying in August.
For the first quarter of this year, which ended March 31, Tenet reported net income of $94 million on revenues of $4.52 billion. In the same period a year earlier, the company posted a net loss of $20 million on revenues of $4.55 billion.
In a week that saw reopening activity pick up across the country, drawing even more attention to the need for sufficient testing to give employers and workers confidence in returning to work, a new study from researchers at New York University (NYU) suggested that a widely-hailed rapid testing machine from Abbott Labs may be unreliable.
The Abbott ID NOW COVID-19 test produced false negatives a third of the time using nasopharyngeal swabs, and 48 percent of the time with less-invasive “dry nasal swabs”, according to the study, which has not yet undergone peer review. The five-minute, point-of-care test received emergency use authorization from the Food and Drug Administration (FDA) in late March and has been touted as a “great test” by President Trump, whose White House relies on it to test the President and those around him.
On Thursday, the FDA issued a warning about the potential for false negative results using the Abbott test. The company disputes the findings and sent a list of questions to the NYU researchers for clarification. Meanwhile, two White House staffers—an aide to the President and the Vice President’s press secretary—tested positive for coronavirus, causing the White House to mandate masks for all employees starting this week.
The uncertainty around test results, and the ensuing concern about safety at the White House, provides a foretaste of the difficult road ahead for thousands of employers nationwide as stay-at-home orders are lifted, and companies consider when and how to reopen workplaces.
If the White House is struggling, how will ordinary businesses fare?
US coronavirus update: 1.46M cases, 87K+ confirmed deaths, 10.2M total tests conducted.
Even after hearing dozens of reports from health systems about how steep their COVID-related volume losses have been, we were still floored by this analysis from healthcare analytics firm Strata Decision Technology, documenting a 55 percent drop in patients seeking hospital care across the country.
The report, which analyzed data from 228 hospitals in 51 health systems across 40 states, found that no clinical service line was immune from steep volume losses. The graphic below shows volume loss by service line in March-April 2020 compared to the same period in 2019.
Unsurprisingly, ophthalmology, gynecology, ortho/spine and ENT—all specialties with a high portion of elective cases, and heavily dependent on procedures—saw volume declines of greater than 70 percent. But even obstetrics and neonatology (which we expected to be “pandemic proof”) and infectious disease (which we thought might be busier in the throes of COVID-19) saw losses of 20-30 percent.
Looking at specific procedures, complex elective surgeries like spinal fusion and hip and knee replacements were almost completely obliterated. Precipitous declines in encounters for chronic diseases like coronary heart disease and diabetes (down 75 and 67 percent, respectively) and cancer screenings (a 55 percent decline in breast health and a 37 percent decline in cancer care overall) point to the likelihood of worrisome disease exacerbations, and a future full of more complex patients.
The volume losses, plus a 114 percent rise in uninsured patients, led to average two-week losses of $26.5M per health system across the study’s cohort. Strata will continue to track and publish volume changes, but this early snapshot paints a bleak picture of staggering financial hits, and “lost” patient care that will carry lasting ramifications for the health of communities nationwide.