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Category Archives: Economy
Cartoon – Economic Stimulus vs. Leadership
If the White House is struggling, how will ordinary businesses fare?
https://mailchi.mp/f4f55b3dcfb3/the-weekly-gist-may-15-2020?e=d1e747d2d8
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.
Quantifying the massive blow to hospital volumes
https://mailchi.mp/f4f55b3dcfb3/the-weekly-gist-may-15-2020?e=d1e747d2d8
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.
Putting a pillar of the community in jeopardy
https://mailchi.mp/f4f55b3dcfb3/the-weekly-gist-may-15-2020?e=d1e747d2d8
It’s easy to become numb to the numbers we’re bombarded with on a daily basis—case counts, deaths, financial losses, unemployment claims, bailout funding. An article from the Washington Post this week put a very human face on how the coronavirus crisis is playing out on the ground, profiling the experience of 115-bed Griffin Hospital in Derby, CT.
We first got to know Griffin, and its CEO Patrick Charmel, years ago in the course of work for our former employer. It’s a remarkable, fiercely independent organization—recognized as the flagship hospital of the “Planetree” patient-centered care model, and a decade-long fixture on Fortune’s list of Top 100 Best Companies to Work For. But the COVID-19 wave hit Griffin hard, as it did much of Connecticut.
With the high cost of caring for COVID patients, and lost revenue from cancelled procedures, Griffin has had to make hard decisions about furloughing and redeploying staff—incredibly difficult for a small facility that has been a pillar of the community for a century. Charmel has been able to secure some relief in the form of advance payment from Medicare, but his efforts to lobby for a share of the state’s allocation of CARES Act grant funding for hospitals proved unsuccessful, and so the future of the hospital—or at least its continued viability as an independent organization—is in jeopardy.
In the words of Griffin’s chief financial officer, “This could be devastating for us.” As the recovery begins, and questions begin to be asked about the billions of dollars of “bailouts” paid to “greedy hospitals”—an easy narrative for the media to latch onto—it’s worth remembering what’s happening to Griffin Hospital, and to hundreds of other similar organizations across the country.
Countless communities rely on these hospitals, and their survival is worth safeguarding.
Trump faces criticism over lack of national plan on coronavirus
Trump faces criticism over lack of national plan on coronavirus
The Trump administration is facing intense criticism for the lack of a national plan to handle the coronavirus pandemic as some states begin to reopen.
Public health experts, business leaders and current administration officials say the scattershot approach puts states at risk and leaves the U.S. vulnerable to a potentially open-ended wave of infections this fall.
The White House has in recent days sought to cast itself as in control of the pandemic response, with President Trump touring a distribution center to tout the availability of personal protective equipment and press secretary Kayleigh McEnany detailing for the first time that the administration did have its own pandemic preparedness plan.
Still, the White House lacks a national testing strategy that experts say will be key to preventing future outbreaks and has largely left states to their own devices on how to loosen restrictions meant to slow the spread of the virus. Trump this week even suggested widespread testing may be “overrated” as he encouraged states to reopen businesses.
The Centers for Disease Control and Prevention (CDC) on Thursday night issued long-awaited guidance intended to aid restaurants, bars and workplaces as they allow employees and customers to return, but they appeared watered down compared to previously leaked versions.
Some experts said the lack of clear federal guidance on reopening could hamper the economic recovery.
“A necessary condition for a healthy economy is a healthy population. This kind of piecemeal reopening with everyone using different criteria for opening, we’re taking a big risk,” said Mark Zandi, chief economist at Moody’s Analytics.
The lack of coherent direction from the White House was driven home this week by damaging testimony by a former top U.S. vaccine official who claims he was ousted from his post improperly.
“We don’t have a single point of leadership right now for this response, and we don’t have a master plan for this response. So those two things are absolutely critical,” said Rick Bright, who led the Biomedical Advanced Research and Development Authority until he was demoted in late April.
The U.S. faces the “darkest winter in modern history” if it does not develop a more coordinated national response, Bright said. “Our window of opportunity is closing.”
From the start, the White House has let states chart their own responses to the pandemic.
The administration did not issue a nationwide stay-at-home order, resulting in a hodgepodge of state orders at different times, with varying levels of restrictions.
Facing a widespread shortage, states were left to procure their own personal protective equipment, ventilators and testing supplies. Trump resisted using federal authority to force companies to manufacture and sell equipment to the U.S. government.
Without clear federal guidance, state officials were competing against each other and the federal government, turning the medical supply chain into a free-for-all as they sought scarce and expensive supplies from private vendors on the commercial market.
“The fact that we had questions about our ability to have enough mechanical ventilators, and you had states basically bidding against each other, trying to secure personal protective equipment … it shouldn’t be happening during a pandemic,” said Amesh Adalja, a senior scholar at the Johns Hopkins University Center for Health Security.
Internally, the administration struggled to mount a unified front as various agencies jockeyed for control. Multiple agencies have been providing contradictory instructions.
At first, Department of Health and Human Services (HHS) Secretary Alex Azar led the White House coronavirus task force.
Roughly a month, later he was replaced by Vice President Pence. The Federal Emergency Management Agency (FEMA) was later tasked with leading the response to get supplies to states, while senior White House adviser Jared Kushner led what has been dubbed a “shadow task force” to engage the private sector. Now, FEMA is reportedly winding down its role, and turning its mission back over to HHS.
The CDC has been largely absent throughout the pandemic. Director Robert Redfield has drawn the ire of President Trump as well as outside experts, and he has been seen infrequently at White House briefings.
“I think seeing the nation’s public health agency hobbled at a time like this and looking over its shoulder at its political bosses is something I hoped I would never see, and I’ve been working with the CDC for over 30 years,” said Lawrence Gostin, a professor of public health at Georgetown University.
“I think that people will die because the public health agency has lost its visibility and its credibility and that it’s being politically interfered with,” he added.
The administration recently has taken some steps to improve on the initial response to the pandemic.
Ventilator production has increased, and the U.S. is no longer seeing a shortage of the devices.
Testing has improved dramatically as well, though experts think the U.S. needs to be testing thousands of more people per day before the country can reopen.
The administration also unveiled plans to expand the Strategic National Stockpile’s supply of gowns, respirators, testing supplies and other equipment, after running out of supplies early in the pandemic.
Adalja said the administration’s positive steps are coming way too late.
“It’s May 15, we should have been in this position January 15,” he said.
McEnany on Friday for the first time detailed the White House’s preparedness plan that replaced the Obama-era pandemic playbook, an acknowledgement that Trump’s predecessor did leave a road map, despite claims to the contrary from some of the president’s allies.
She did not give many specifics on the previously unknown plan. Instead, McEnany declared the Trump administration’s handling of the virus had been “one of the best responses we’ve seen in our country’s history.”
Yet as states look to reopen businesses and get people back to work, the White House is taking a back seat as governors set their own guidelines for easing stay-at-home orders and restrictions on social activities.
The White House in April issued a three-step plan for states to reopen their economies, but it has largely been ignored by states and by the president.
Dozens of governors have begun easing restrictions on businesses and social activities without meeting the White House guidelines. Trump has been urging them to move even faster, backing anti-lockdown protesters in Michigan, Virginia, Minnesota and Pennsylvania.
Even scaled-down guidance from federal agencies is critical for providing a road map for state and local leaders, and for businesses considering how best to resume operations, said Neil Bradley, chief policy officer with the U.S. Chamber of Commerce.
“We need guidance because it helps instill confidence about the right types of approaches to take, but when you begin to move away from guidance and into either regulations or very strict approach, then that’s increasingly going to be unworkable in lots of different locations,” Bradley said.
Seven weeks into coronavirus lockdowns, Fed has a new, darker message
https://www.yahoo.com/news/seven-weeks-coronavirus-lockdowns-fed-182614531.html
One Thursday morning seven weeks ago, Federal Reserve Chair Jerome Powell made a rare appearance on NBC’s “Today Show” to offer a reassuring message to Americans dealing with economic fallout from measures to contain the coronavirus outbreak.
There is “nothing fundamentally wrong with our economy,” Powell told viewers, while pointing out the U.S. central bank’s outsized ability to take on lending risk and provide a financial “bridge” over the temporary economic weakness the country was experiencing.
Speaking after the Fed cut interest rates to near zero and rolled out a plan to backstop credit for small- and mid-sized companies, Powell emphasized the first order of business was to get the virus under control.
“The sooner we get through this period and get the virus under control, the sooner the recovery can come,” said Powell, echoing remarks made the day before by Anthony Fauci, a top U.S. health official helping to coordinate the federal government’s response to the coronavirus crisis.
At the time, Powell said he expected economic activity would resume in the second half of the year, and maybe even enjoy a “good rebound.”
But on Wednesday, he offered a much more sober outlook.
In an interview webcast by the Peterson Institute for International Economics, Powell warned of an “extended period” of weak economic growth, tied to uncertainty about how well the virus could be controlled in the United States. “There is a sense, growing sense I think, that the recovery may come more slowly than we would like,” he said.
Fauci, the director of the National Institute of Allergy and Infectious Diseases, was similarly somber when he told lawmakers earlier this week that the country was by no means in “total control” of the outbreak.
“There is a real risk that you will trigger an outbreak that you may not be able to control and, in fact, paradoxically, will set you back, not only leading to some suffering and death that could be avoided, but could even set you back on the road to try to get economic recovery,” Fauci said.
The pandemic has killed more than 83,000 people in the United States so far, and many epidemiological models now point to a death toll that will surpass 100,000 in a matter of weeks.
Overall new cases of the virus continue to climb as well, as states end lockdowns and reopen local economies without the widespread, uniform testing and contact tracing policies that helped stamp out initial outbreaks in South Korea and Germany.
UNCERTAIN FUTURE
Powell’s remarks on Wednesday mirrored warnings this week from a clutch of regional Fed presidents who outlined the country’s uncertain future.
U.S. central bank officials, and especially the Fed chief, historically choose their words carefully, to avoid alarming or exciting investors or causing swings in financial markets, making their universally dour outlook more remarkable.
St. Louis Fed President James Bullard said the situation could lead to a new Great Depression, with millions of so-far temporary job losses becoming permanent, and businesses failing “on a grand scale.”
“We have to get better at this and get more risk-based with our health policy,” Bullard said.
The U.S. economy can return to growth in the second half of the year, Cleveland Fed President Loretta Mester said on Tuesday, with more testing and contact tracing. If that happens, she said, “as some of the stay-at-home restrictions are lifted, the economy will begin to grow again in the second half of this year and unemployment will begin to move down.”
However, a more pessimistic scenario, in which a surge in infections requires businesses to shut down again or the crisis leads to more bankruptcies or instability in the banking sector, is “almost as likely,” she said.
Amid reports of White House clashes with CDC, experts raise alarms about lack of coronavirus screening at airports
https://www.yahoo.com/news/coronavirus-screening-airports-144105500.html
As the nation begins to reopen amid the coronavirus pandemic, some people are looking to the skies — and experts don’t necessarily like what they see, arguing there are not enough safeguards in place to protect passengers and crew.
While air travel has fallen sharply due to the virus, the airports are open and planes are flying both domestically and internationally. The Centers for Disease Control and Prevention has issued travel guidelines encouraging air passengers to wear face coverings, “keep 6 feet of physical distance from others” and only board planes for essential travel. However, these guidelines are merely suggestions.
There is no requirement for masks, and there have been multiple reports of crowded conditions in airports and on planes, which have left passengers alarmed. The Transportation Security Administration, which screens passengers and luggage at airports, has also experienced over 560 confirmed cases of COVID-19, the disease caused by the coronavirus, and six deaths from the illness.
Despite these concerns, there are currently no coronavirus screening procedures for domestic air travelers, and a congressional investigation has also raised questions about the level of screening being conducted for international passengers. Speaking in the Oval Office on April 28, President Trump told reporters his administration is working on implementing a procedure for temperature checks and COVID-19 tests for air travelers.
“We’re also setting up a system where we do some testing, and we’re working with the airlines on that,” Trump said.
According to a May 6 government document reviewed by Yahoo News, the CDC was “developing a tool for predicting risk of importation of COVID-19 among international travelers” and meeting with the White House National Security Council “to discuss strategies for screening arriving international passengers from countries with substantial COVID-19 transmission.”
However, there have been reports of discord between the CDC and the White House. On May 9, USA Today reported CDC officials were overruled by the White House after they raised concerns about a potential plan to establish temperature checks at the airports. While some COVID-19 patients do have high fevers, many do not and others are entirely asymptomatic.
USA Today’s report included an email Dr. Martin Cetron, the CDC’s director of global mitigation and quarantine, sent to officials with the Department of Homeland Security criticizing the temperature checks as “a poorly designed control and detention strategy.”
Cetron, the CDC and DHS did not respond to requests for comment. The White House did not respond to questions about the reported disagreements from the CDC or whether the Trump administration believes temperature checks are an adequate screening measure for airports.
Rep. Raja Krishnamoorthi, the chairman of the House oversight subcommittee on economic and consumer policy, has investigated coronavirus screening procedures at airports. Earlier this week, the Illinois Democrat told Yahoo News he was concerned by the report that the White House is pursuing a temperature screening plan over the objections of CDC officials.
“The White House has been ignoring and sidelining America’s public health experts at the CDC, instead relying on nonexpert political appointees to make public health decisions,” Krishnamoorthi said. “I am troubled by reports that officials at the Centers for Disease Control and Prevention could raise this public health concern and be essentially overruled by presidential aides. The desire to lure Americans back into traveling by making them feel like they are safe cannot outweigh the need to actually keep this country safe.”
Krishnamoorthi has previously raised concerns about what he described as “lax” screening procedures for international travelers coming into the United States from coronavirus hot spots in March as the pandemic exploded around the globe. Trump has repeatedly pointed to restrictions he imposed on travelers from China — where the virus originated — on Jan. 31 as evidence of his strong efforts to curb its spread in the United States.
However, the restrictions on China contained exemptions that allowed over 400,000 people to subsequently travel from that country to the United States. And on May 7, Krishnamoorthi’s subcommittee released the results of an investigation that focused on two other early coronavirus hot spots — Italy and South Korea. Krishnamoorthi said he believes Trump has focused on “rhetoric and bluster rather than actually effective screenings.”
“Just from what we found with Italy and South Korea, there was no border closing. There was no screening. Unfortunately, the lack of screening probably had some very serious consequences at a time when cases were exponentially rising in the United States.”
Krishnamoorthi’s investigation, which included extensive briefings from officials, found that the White House National Security Council’s Policy Coordination Committees decided in March to rely on South Korean and Italian officials to screen passengers in those countries who were headed to the United States. The probe further found the U.S. had “limited” oversight for those screenings in Italy and that only 69 passengers were prevented from coming to the U.S. from those two countries in March. Once they arrived, the investigation found passengers entering from the two countries did not receive additional health screenings.
“Potentially thousands and thousands of people came across without screenings” from what were two of the leading coronavirus hot spots at the time, Krishnamoorthi told Yahoo News. “It doesn’t take a lot to believe that folks came over and seeded further outbreaks here in this country.”
Jonathan Ullyot, a spokesperson for the White House National Security Council, responded to questions about Krishnamoorthi’s investigation with a statement touting the government’s steps to screen international arrivals earlier this year.
“The reality is that the United States government took early and decisive action to mitigate the risk from global hot spots, including China, Iran, South Korea, and the Schengen area of Europe,” Ullyot wrote. “After restricting travel from China on January 31 … the security directive put forth by the administration required enhanced medical screenings for all passengers before they departed on flights to the United States from Northern Italy and South Korea.”
According to Ullyot, the screenings in Italy and South Korea “included checking the passenger’s temperature, visual observations to detect signs of illness, and questionnaires.” While Ullyot did not dispute Krishnamoorthi’s contention that the U.S. relied on officials in those countries to conduct the screenings and that few passengers were denied boarding, he said “U.S. mission staff visited airports” in both countries to “observe these screening procedures.”
A senior Trump administration official, who requested not to be named, said all international arrivals to the United States are subject to Customs and Border Protection (CBP) screenings that are following CDC guidelines. The official explained that those guidelines require CBP officers to refer travelers “to the CDC, DHS contract medical screeners, or local health authorities for health screening” if they are exhibiting symptoms or have traveled from countries that have experienced major outbreaks.
According to the official, the CBP has “established processes to identify travelers who have traveled to the United States directly or indirectly from areas that are experiencing COVID-19 outbreaks.”
Domestic air passengers, however, are treated differently.
“With regard to domestic travel, there’s not more screening beyond what TSA normally does,” Krishnamoorthi said.
He said that lack of screening for domestic travelers is particularly worrisome as areas of the country are beginning to lift lockdown restrictions. He suggested this could lead to a situation where business people “go back and start traveling” and then “transport these cases everywhere.”
“We have to look at the science of it more closely, and we have to develop a more precise way of screening,” Krishnamoorthi said.
Randy Babbitt, a former administrator of the Federal Aviation Administration, said the lack of new screening procedures is not as much of a problem right now since “nobody’s flying.” However, he said it will become a pressing issue as the country reopens and airports become more crowded.
“People are going to start flying and as it ramps back up, that becomes a different question,” Babbitt told Yahoo News.
Babbitt further explained that one difficulty with establishing comprehensive procedures for airports is that so many different government agencies are involved in air travel. However, he pointed to proposals generated by Stonebriar Strategy Group Thought Leadership Initiative, a nonprofit consultancy, as a realistic potential road map.
Howard Thrall, the president and senior partner of the group, said the organization is comprised of multiple retired consultants and executives who have worked in the industry. According to Thrall, a veteran executive who has worked for multiple aviation and aerospace companies, the group came together because they were “totally amazed” a coronavirus airport screening system has not yet been established.
“This is really a pro bono exercise for a bunch of old graybeards,” Thrall said.
The Stonebriar Strategy Group’s proposal calls for screening perimeters to be established outside airports, where rapid COVID-19 tests, questionnaires and temperature checks could be administered to travelers and workers. Setting up a screening perimeter would mean that even if passengers ended up in close proximity during boarding or on planes, they could have a higher degree of confidence those around them were not contagious.
Along with addressing safety concerns, Thrall said implementing these screenings could help the economy since aviation is a substantial part of the nation’s gross domestic product and boosting consumer confidence is crucial to returning the industry to normal levels. He pointed to the aftermath of the Sept. 11 attacks, when the TSA was formed and security screening procedures were transformed, as evidence that airport procedures can quickly be revamped.
The Stonebriar Strategy Group’s detailed proposal estimated it would cost approximately $6.8 million per airport, per year, to establish coronavirus screening perimeters. With approximately 5,000 public airports in the country, that would mean a total cost of about $34 billion.
However, Thrall argued that cost is realistic relative to the urgent need and the trillions of dollars the government is spending to address the coronavirus.
“That’s why we wrote it up. It wasn’t happening and it could happen. This is not a big deal,” Thrall said. “I mean, it’s not going to be free by any means, but this is very, very manageable.”
Window of Opportunity is Closing for Coronavirus Response
A top vaccine doctor who was ousted from his position in April is expected to testify Thursday that the Trump administration was unprepared for the coronavirus, and that the U.S. could face the “darkest winter in modern history” if it doesn’t develop a national coordinated response, according to prepared testimony first obtained by CNN.
The big picture: Rick Bright, the former head of the Biomedical Advanced Research and Development Authority (BARDA), will tell Congress that leadership at the Department of Health and Human Services ignored his warnings in January, February and March about a potential shortage of medical supplies.
- He will testify that HHS “missed early warning signals” and “forgot important pages from our pandemic playbook” early on — but that “for now, we need to focus on getting things right going forward.”
- Bright’s testimony also reiterates claims from a whistleblower report he filed last week that alleges he was ousted over his attempts to limit the use of hydroxychloroquine — an unproven drug touted by President Trump — to treat the coronavirus.
What he’s saying: Bright will testify he urged HHS to ramp up production of
masks, respirators and medical supplies as far back as January. Those warnings were dismissed, Bright says, and he was “cut out of key high-level meetings to combat COVID-19.”
- “I continue to believe that we must act urgently to effectively combat this deadly disease. Our window of opportunity is closing. If we fail to develop a national coordinated response, based in science, I fear the pandemic will get far worse and be prolonged, causing unprecedented illness and fatalities.”
Bright will call for a national strategy to combat the virus, including “tests that are accurate, rapid, easy to use, low cost, and available to everyone who needs them.”
- “Without clear planning and implementation of the steps that I and other experts have outlined, 2020 will be darkest winter in modern history.”
Read Bright’s prepared statement.
Fed chair Powell warns of “lasting” economic damage without more stimulus
Federal Reserve Chairman Jerome Powell said Congress may need to do more to prevent a worse economic downturn triggered by the coronavirus pandemic, in an interview with the Peterson Institute’s Adam Posen on Wednesday.
Why it matters: Powell warned of dire economic consequences without additional stimulus. While the Fed has responded to the pandemic with the most aggressive policy actions in the central bank’s history, it doesn’t have the power to get money directly in the hands of Americans and businesses in the form of grants like Congress does.
The backdrop: The coronavirus has pushed the economy into a downturn not seen since the Great Depression, with a record number of Americans out of work.
- Congress and the Fed have unleashed trillions of dollars in coronavirus aid to support the economy.
- House Democrats proposed another $3 trillion in stimulus this week, but more spending is facing resistance from Republican members of Congress.
What they’re saying: “Additional fiscal support could be costly, but worth it if it helps avoid long-term economic damage and leaves us with a stronger recovery,” Powell said.
- “It’s not the time to prioritize” concerns about fiscal spending, Powell said.
Powell warned about the long-lasting damage a steep, prolonged downturn could have on the economy, including permanent scarring to the most vulnerable workers in the labor force.
- In a Fed survey set to be released tomorrow, Powell said 40% of people making less than $40,000/year who were employed in February, lost their job in March.
HENRY KOTULA 