Patient volumes at hospitals, doctors’ and dentists’ offices recovered slightly in May but lagged well behind pre-pandemic levels, according to a new analysis from Moody’s Investors Service.
In all, the ratings agency estimated total surgeries at rated for-profit hospitals declined by 55% to 70% in April compared with the same period in 2019. States required hospitals to cancel or delay elective procedures, which are vital to hospitals’ bottom lines.
“Patients that had been under the care of physicians before the pandemic will return first in order to address known health needs,” officials from the ratings agency said in a statement. “Physicians and surgeons will be motivated to extend office or surgical hours in order to accommodate these patients.”
Those declines narrowed to 20% to 40% in May when compared to 2019.
Emergency room and urgent care volumes were still down 35% to 50% in May.
“This could reflect the prevalence of working-from-home arrangements and people generally staying home, which is leading to a decrease in automobile and other accidents outside the home,” the analysis said. “Weak ER volumes also suggest that many people remain apprehensive to enter a hospital, particularly for lower acuity care.”
The good news: The analysis estimated it is unlikely there will be a return to the nationwide decline of volume experienced in late March and April because healthcare facilities are more prepared for COVID-19.
For instance, hospitals have enough personal protective equipment for staff and have expanded testing, the analysis said.
For-profit hospitals also have “unusually strong liquidity to help them weather the effects of the revenue loss associated with canceled or postponed procedures,” Moody’s added. “That is largely due to the CARES Act and other government financial relief programs that have caused hospital cash balances to swell.”
However, the bill for one of those sources of relief is coming due soon.
Hospitals and other providers will have to start repaying Medicare for advance payments starting this summer. The Centers for Medicare & Medicaid Services doled out more than $100 billion in advance payments to providers before suspending the program in late April.
Hospital group Federation of American Hospitals asked Congress to change the repayment terms for such advance payments, including giving providers at least a year to start repaying the loans.
Another risk for providers is the change in payer mix as people lose jobs and commercial coverage, shifting them onto Medicaid or the Affordable Care Act’s (ACA’s) insurance exchanges.
“This will lead to rising bad debt expense and a higher percentage of revenue generated from Medicaid or [ACA] insurance exchange products, which typically pay considerably lower rates than commercial insurance,” Moody’s said.
Over the past months, the country and the economy have radically shifted to unchartered territory. Now more than ever, we must reexamine how we spend health care dollars.
While the COVID-19 pandemic has exposed challenges with health care in America, we see two overarching opportunities for change:
1) the under-delivery of evidence-based care that materially improves the lives and well-being of Americans and
2) the over-delivery of unnecessary and, sometimes, harmful care.
The implications of reallocating our health care spending to high-value services are far-ranging, from improving health to economic recovery.
To prepare for coronavirus patients and preserve protective equipment, clinicians and hospitals across the country halted non-urgent visits and procedures. This has led to a substantial reduction in high-value care: emergency care for strokes or heart attacks, childhood vaccinations, and routine chronic disease management. However, one silver lining to this near shutdown is that a similarly dramatic reduction in the use of low-value services has also ensued.
As offices and hospitals re-open, we have a once in a century opportunity to align incentives for providers and consumers, so patients get more high-value services in high-value settings, while minimizing the resurgence of low-value care. For example, the use of pre-operative testing in low-risk patients should not accompany the return of elective procedures such as cataract removal. Conversely, benefit designs should permanently remove barriers to high-value settings and services, like patients receiving dialysis at home or phone calls with mental health providers.
People with low incomes and multiple chronic conditions are of particular concern as unemployment rises and more Americans lose their health care coverage. Suboptimal access and affordability to high-value chronic disease care prior to the COVID-19 pandemic was well documented As financially distressed providers re-open to a new normal, hopeful to regain their financial footing, highly profitable services are likely to be prioritized.
Unfortunately, clinical impact and profitability are frequently not linked. The post-COVID reopening should build on existing quality-driven payment models and increase reimbursement for high-value care to ensure that compensation better aligns with patient-centered outcomes.
At the same time, the dramatic fall in “non-essential care” included a significant reduction in services that we know to be harmful or useless. Billions are spent annually in the US on routinely delivered care that does not improve health; a recent study from 4 states reports that patients pay a substantial proportion (>10 percent) of this tab out-of-pocket. This type of low-value care can lead to direct harm to patients — physically or financially or both — as well as cascading iatrogenic harm, which can amplify the total cost of just one low-value service by up to 10 fold. Health care leaders, through the Smarter Health Care Coalition, have hence called on the Department of Health and Human Services Secretary Azar to halt Medicare payments for services deemed low-value or harmful by the USPSTF.
As offices and hospitals reopen with unprecedented clinical unmet needs, we have a unique opportunity to rebuild a flawed system. Payment policies should drive incentives to improve individual and population health, not the volume of services delivered. We emphasize that no given service is inherently high- or low-value, but that it depends heavily on the individual context. Thus, the implementation of new financial incentives for providers and patients needs to be nuanced and flexible to allow for patient-level variability. The added expenditures required for higher reimbursement rates for highly valuable services can be fully paid for by reducing the use of and reimbursement for low-value services.
The delivery of evidence-based care should be the foundation of the new normal. We all agree that there is more than enough money in U.S. health care; it’s time that we start spending it on services that will make us a healthier nation.
Though U.S. hospital staffing companies are slowly beginning to recover from the COVID-19 shutdown and corresponding drop in revenues, that rebound will lag behind hospitals.
Recovery of giants like ER staffing firm Envision and AMN Healthcare, which has the largest network of qualified clinicians in the U.S., will be hindered as hospitals prefer to keep their own staff employed over external contractors amid a recession.
The “pace of recovery will not be linear,” and depends on the mix of service lines and geography, S&P Global analysts said in a Thursday note. Analysts also expect hospitals to aggressively renegotiate rates and terms with staffing companies later in the year, which could depress margins even more in the long-term.
Dive Insight:
The collapse in patient volume following stay-at-home guidelines implemented earlier this year has had a well-documented effect on provider finances. Hospitals and doctor’s offices prepared for an influx of COVID-19 patients as lucrative elective procedures declined and revenues imploded.
At the nadir in April, anesthesiology services were down 70%, radiology down 60% and ER visits down 40%, S&P said. Analysts expect tentative recovery in May and June, but no return to pre-pandemic volume until mid-2021.
The dramatic reduction slashed the revenues and cash flows of staffing companies, though the worst is likely over. At the beginning of the pandemic, staffing companies and hospitals alike took preventive measures like furloughing nonessential and back-office workers, extending vendor payment terms, aggressively collecting old receivables and onboarding doctors to telehealth. Many have kept up adequate frontline capacity too, despite uncertain demand.
The economy saw some small gains in May as furloughed employees began to trickle back to work. But the increase in health services employment that month came largely in dental health workers and physician offices. Hospitals shed another 27,000 jobs.
Hospitals will likely fill staffing needs internally, bringing back furloughed or laid off employees first as operations slowly improve, before turning once again to medical contractors.
“Given the extended disruption, a looming recession, and possible lasting changes to health care providers, credit metrics will be much weaker than what we had previously expected for nearly all staffing companies,” analysts wrote. “Some staffing companies, particularly those that are highly leveraged, may face very significant liquidity pressures for several months. It is possible not all will be able to withstand the sharp decline.”
S&P Global has taken a number of negative rating actions on staffing companies since late March.
Envision and anesthesiology firm ASP Napa, both rated ‘CCC’ with a negative outlook, have the greatest potential for a default. Envision, owned by private equity firm KKR and one of the largest U.S. physician staffing firms, is reportedly considering a bankruptcy filing as it struggles with $7 billion in debt.
Knoxville, Tenn.-based Team Health and clinical practice management firm SCP Health have enough liquidity to chug along for several more months of lower-than-normal volumes, while AMN and Utah-based CHG Healthcare Services are both in more solid positions to weather the pandemic, S&P said.
But professional outsourced staffing businesses, like anesthesiology and radiology, should recover more quickly, and many firms have gotten financial support from lenders and private equity backers. Team Health, for example, approved a senior secured term loan from its PE sponsor, Blackstone, which covers interest payments in April through mid-May.
Liquidity was also helped by the passage of the $2.2 trillion CARES relief legislation late March.
Several staffing companies have reportedly received grants from the $100 billion allocated by the legislation for providers, along with no-interest loans from accelerated Medicare payments, sparking questions over whether companies backed by cash-rich private equity firms need the funds.
A Moody’s Investors Service report on Thursday suggests that the U.S. healthcare industry is on the rebound from COVID-19, but recovery will likely to slow and uneven. Moreover, the report expressed concerns that regional flareups of coronavirus could majorly set back the return to normal volumes.
Investment firm Jefferies affirmed those worries in hospital traffic data shared Friday, noting “a sharp reversal” in hotspot state Arizona. Analysts tracked “record lows” in Arizona’s hospital traffic last week, down from what was thought to be the trough in April and sagging below May recovery amid a significant uptick in COVID-19 cases and protests.
“Whether states can continue their recovery even as cases increase, as we’ve seen in [Texas] and others, or if the recent reversals in [Arizona, Illinois,] etc. become more widespread is a trend to watch in coming weeks,” Jefferies analysts wrote.
Dive Insight:
Large sections of the healthcare sector all but shut down during the spring as the coronavirus led to nationwide shelter-in-place orders. However, as states and municipalities slowly reopen, so are the doors for hospitals, ambulatory surgical centers, clinics and other integral components of healthcare delivery.
As a result, Moody’s reported “considerable sequential improvement” during May. For example, while for-profit hospitals saw surgery volumes drop as much as 70% in April compared to the same period in 2019, May volumes were down about 20% to 40% compared to last year’s. Hospital-operated ambulatory surgical centers saw an 80% to 90% drop in April volumes, but only a 30% to 40% drop in May.
However, Moody’s noted that the “path to normalized volumes are not linear.” It also pointed out that emergency room care volumes, which dropped as much as 60% in April, have yet to really rebound, as they still appeared depressed as much as 50% in May.
“This could reflect the prevalence of working-from-home arrangements and people generally staying home, which is leading to a decrease in automobile and other accidents outside the home. Weak ER volumes also suggest that many people remain apprehensive to enter a hospital, particularly for lower acuity care,” the Moody’s report said.
The firm also noted that “the shape of recovery will vary by state, region and service line, reinforcing the importance of diversification for credit quality among healthcare service providers.”
However, Moody’s believes that the darkest days of March and April are behind much of the healthcare sector. It noted that most providers have stockpiled appropriate personal protective equipment and have reconfigured their offices, waiting rooms and other infrastructure to protect the health of both patients and employees.
Traffic data from 3,300 U.S. hospitals, tracked by Jefferies via mobile device pings, indicates that compared to January 2019 levels, national traffic lows of 43.7% in mid-April improved to 63.3% by early June.
But state-by-state analysis reveals some parts of the country are trending backwards. Arizona fell to a new low of 28.5% last week after hitting 51.5% on May 20. The analysts also reported Illinois hit its own new low on June 7.
While Moody’s did express some concern about regional outbreaks, it concluded that the precautions already taken “make it less likely that the U.S. would once again shut down all non-elective care across the nation if there is a second wave of coronavirus infections.”
Moody’s did express some concerns about hospital finances, but noted that for-profit hospitals “have unusually strong liquidity” due to payouts from the CARES Act and other government-sponsored financial relief programs.
Medical device firms should be prepared for a long and uneven recovery, according to Moody’s. The dental and orthopaedic sectors “will see a greater than average impact from consumers’ inability to pay for procedures or their unwillingness to engage with the healthcare system.” Moody’s forecast “a gradual, uneven pace of recovery,” with pre-tax earnings to decline as much as 30% in 2020 compared to 2019, while revenues will shrink around 10%. It expects that earnings will rebound in 2021 to 2019 levels.
Companies that operate in discretionary sectors will be hit harder as they rely on patients able to meet large deductibles or co-payments or to pay for related procedures entirely on their own. Moody’s noted that a large number of these procedures are performed in acute care hospitals with the assistance of robotics, but hospitals may be more conservative in their robotics investments given new budget constraints.
ProPublica deputy managing editor Charles Ornstein wanted to know why experts were wrong when they said U.S. hospitals would be overwhelmed by COVID-19 patients. Here’s what he learned, including what hospitals can do before the next wave.
The prediction from New York Gov. Andrew Cuomo was grim.
In late March, as the number of COVID-19 cases was growing exponentially in the state, Cuomo said New York hospitals might need twice as many beds as they normally have. Otherwise there could be no space to treat patients seriously ill with the new coronavirus.
“We have 53,000 hospital beds available,” Cuomo, a Democrat, said at a briefing on March 22. “Right now, the curve suggests we could need 110,000 hospital beds, and that is an obvious problem and that’s what we’re dealing with.”
The governor required all hospitals to submit plans to increase their capacity by at least 50%, with a goal of doubling their bed count. Hospitals converted operating rooms into intensive care units, and at least one replaced the seats in a large auditorium with beds. The state worked with the federal government to open field hospitals around New York City, including a large one at the Jacob K. Javits Convention Center.
But when New York hit its peak in early April, fewer than 19,000 people were hospitalized with COVID-19. Some hospitals ran out of beds and were forced to transfer patients elsewhere. Other hospitals had to care for patients in rooms that had never been used for that purpose before. Supplies, medications and staff ran low. And, as The Wall Street Journal reported on Thursday, many New York hospitals were ill prepared and made a number of serious missteps.
All told, more than 30,000 New York state residents have died of COVID-19. It’s a toll worse than any scourge in recent memory and way worse than the flu, but, overall, the health care system didn’t run out of beds.
“All of those models were based on assumptions, then we were smacked in the face with reality,” said Robyn Gershon, a clinical professor of epidemiology at the NYU School of Global Public Health, who was not involved in the models New York used. “We were working without situational awareness, which is a tenet in disaster preparedness and response. We simply did not have that.”
Cuomo’s office did not return emails seeking comment, but at a press briefing on April 10, the governor defended the models and those who created them. “In fairness to the experts, nobody has been here before. Nobody. So everyone is trying to figure it out the best they can,” he said. “Second, the big variable was, what policies do you put in place? And the bigger variable was, does anybody listen to the policies you put in place?”
So, why were the projections so wrong? And how can political leaders and hospitals learn from the experience in the event there is a second wave of the coronavirus this year? Doctors, hospital officials and public health experts shared their perspectives.
The Models Overstated How Many People Would Need Hospital Care
The models used to calculate the number of people who would need hospitalization were based on assumptions that didn’t prove out.
Early data from the U.S. Centers for Disease Control and Prevention suggested that for every person who died of COVID-19, more than 11 would be hospitalized. But that ratio was far too high and decreased markedly over time, said Dr. Christopher J.L. Murray, director of the Institute for Health Metrics and Evaluation at the University of Washington. IHME’s earliest models on hospitalizations were based on that CDC data and predicted that many states would quickly run out of hospital beds.
A subsequent model, released in early April, assumed about seven hospitalizations per death, reducing the predicted surge. Currently, Murray said, the ratio is about four hospital admissions per death.
“Initially what was happening and probably what we saw in the CDC data is doctors were admitting anybody they thought had COVID,” Murray said. “With time they started admitting only very sick people who needed oxygen or more aggressive care like mechanical ventilation.”
A patient with COVID-19 is taken into Mount Sinai Hospital in New York on May 3. (Alexi Rosenfeld/Getty Images)
A model created by the Harvard Global Health Institute made a different assumption that also turned out to be too high. Data from Wuhan, China, suggested that about 20% of those known to be infected with COVID-19 were hospitalized. Harvard’s model, which ProPublica used to build a data visualization, assumed a hospitalization rate in the United States of 19% for those under 65 who were infected and 28.5% for those older than 65.
But in the U.S., that percentage proved much too high. Official hospitalization rates vary dramatically among states, from as low as 6% to more than 20%, according to data gathered from states by The COVID Tracking Project. (States with higher rates may not have an accurate tally of those infected because testing was so limited in the early weeks of the pandemic.) As testing increases and doctors learn how to treat coronavirus patients out of the hospital, the average hospitalization rate continues to drop.
New York state’s testing showed that by mid-April, approximately 20% of the adult population in New York City had antibodies to COVID-19. Given the number hospitalized in the city and adjusting for the time needed for the body to produce antibodies, this means that the city’s hospitalization rate was closer to 2%, said Dr. Nathaniel Hupert, an associate professor at Weill Cornell Medicine and co-director of the Cornell Institute for Disease and Disaster Preparedness.
Dr. Ashish Jha, director of the Harvard Global Health Institute, and his team also assumed that between 20% and 60% of the population would be infected with COVID-19 over six to 18 months. That was before stay-at-home orders took effect nationwide, which slowed the virus’s spread. Outside of New York City, a far lower percentage of the population has been infected. Granted, we’re not even six months into the pandemic.
A number of factors go into disease models, including the attack rate (the percentage of the entire population that eventually becomes infected), the symptomatic rate (how many people are going to show symptoms), the hospitalization rate for different age groups, the fraction of those hospitalized that will need intensive care and how much care they will need, as well as how the disease travels through the population over time (what is known as “the shape of the epidemic curve”), Hupert said.
Before mid-March, Hupert’s best estimate of the impact of COVID-19 in New York state was that it would lead to a peak hospital occupancy of between 13,800 to 61,000 patients in both regular medical wards and intensive care. He shared his work with state officials.
David Muhlestein, chief strategy and chief research officer at Leavitt Partners, a health care consulting firm, said one takeaway from COVID-19 is that models can’t try to predict too far into the future. His firm has created its own projection tool for hospital capacity that looks ahead three weeks, which Muhlestein said is most realistic given the available data.
“If we were held to our very initial projection of what was going to happen, everybody would be very wrong in every direction,” he said.
Hospitals Proved Surprisingly Adept at Adding Beds
When calculating whether hospitals would run out of beds, experts used as their baseline the number of beds in use in each hospital, region and state. That makes sense in normal times because hospitals have to meet stringent rules before they are able to add regular beds or intensive care units.
Workers prepare dozens of extra beds that were delivered to Mount Sinai on March 31. (Spencer Platt/Getty Images)
But in the early weeks of the pandemic, state health departments waived many rules and hospitals responded by increasing their capacity, sometimes dramatically. “Just because you only have six ICU beds doesn’t mean they will only have six ICU beds next week,” Muhlestein said. “They can really ramp that up. That’s one of the things we’re learning.”
Take Northwell Health, a chain of 17 acute-care hospitals in New York. Typically, the system has 4,000 beds, not including maternity beds, neonatal intensive care unit beds and psychiatric beds. The system grew to 6,000 beds within two weeks. At its peak, on April 7, the hospitals had about 5,500 patients, of which 3,425 had COVID-19.
The system erected tents, placed patients in lobbies and conference rooms, and its largest hospital, North Shore University Hospital, removed the chairs from its 300-seat auditorium and replaced them with a unit capable of treating about 50 patients. “We were pulling out all the stops at that point,” Senior Vice President Terence Lynam said. “It was unclear if the trend was going to go the other way. We did not end up needing them all.”
Northwell went from treating 49 COVID-19 inpatients on March 16 to 3,425 on April 7. “I don’t think anybody had a clear handle on what the ceiling was going to be,” Lynam said. As of Wednesday, the system was still caring for 367 COVID-19 patients in its hospitals.
As hospitals found ways to expand, government leaders worked with the Army Corps of Engineers to build dozens of field hospitals across the country, such as the one at the Javits Center. According to an analysis of federal spending by NPR, those efforts cost at least $660 million. “But nearly four months into the pandemic, most of these facilities haven’t treated a single patient,” NPR reported. As they began to come online, stay-at-home orders started producing results, with fewer positive cases and fewer hospitalizations.
Demand for Non-COVID-19 Care Plummeted More Than Expected
Hospitals across the country canceled elective surgeries, from hip replacements to kidney transplants. That greatly reduced the number of non-COVID-19 patients they had to treat. “We generated a lot more capacity by getting rid of elective procedures than any of us thought was possible,” Harvard’s Jha said.
Northwell canceled elective surgeries on March 16, and over the span of the next week and a half, its hospitals discharged several thousand patients in anticipation of the coming surge. “In retrospect, it was a wise move,” Lynam said. “It just ballooned after that. If we had not discharged those patients in time, there would have been a severe bottleneck.”
What’s more, experts say, it’s clear that some patients with true emergencies also stayed home. A recent report from the CDC said that emergency room visits dropped by 42% in the early weeks of the pandemic. In 2019, some 2.1 million people visited ERs each week from late March to late April. This year, that dropped to 1.2 million per week. That was especially true for children, women and people who live in the Northeast.
In New York City, emergency room visits for asthma practically ceased entirely at the peak, Cornell’s Hupert said. “You wouldn’t imagine that asthma would just disappear,” he said. “Why did it go away? … Nobody has seen anything like that.”
Undoubtedly some people experienced heart attacks and strokes and didn’t go to the hospital because they were fearful of getting COVID-19. “I didn’t expect that,” Jha said. A draft research paper available on a preprint server, before it is reviewed and published in an academic journal, found that heart disease deaths in Massachusetts were unchanged in the early weeks of the pandemic compared to the same period in 2019. What that may mean is that those people died at home.
The Coronavirus Attacked Every Region at a Different Pace
Some initial models forecast that COVID-19 would hit different regions in similar ways. That has not been the case. New York was hit hard early; California was not, at least initially.
In recent weeks, hospitals in Montgomery, Alabama, saw a lot of patients. Arizona’s health director has told hospitals in the state to “fully activate” their emergency plans in light of a spike in cases there. The Washington Post reported on Tuesday that hospitalizations in at least nine states have been rising since Memorial Day.
St. Luke’s, a closed hospital in Phoenix, is prepared to receive overflow patients on April 23. Arizona initially wasn’t hit hard, but cases are now spiking. (Ross D. Franklin/AP Photo)
Dr. Mark Rupp, medical director of the Department of Infection Control and Epidemiology at the University of Nebraska Medical Center in Omaha, said his region hasn’t seen a tidal wave like New York. “What we’ve seen is a rising tide, a steady increase in the number of cases.” Initially that was associated with outbreaks at specific locations like meatpacking and food processing plants and to some degree long-term care facilities.
But since then, “it has just plateaued,” he said. “That has me concerned. This is a time when I feel like we should be working as hard as we can to push these numbers as low as possible.”
Rupp’s hospital has been caring for 50 to 60 COVID-19 patients on any given day. The hospital has started to perform surgeries and procedures that had been on hold because “elective cases stay elective for only so long.”
The hospital’s general medical/surgical beds are 70% to 80% filled, and its ICU beds are 80% to 90% full. “We don’t have a big cushion.”
Even in New York City, the virus hit boroughs differently. Queens and the Bronx were hard hit; Manhattan, Brooklyn and Staten Island less so. “Maybe we can’t even model a city as big as New York,” Hupert said. “Each neighborhood seemed to have a different type of outbreak.”
That needs further study but could be attributable to both social and demographic conditions and the type of jobs residents of the neighborhoods had, among other factors.
What We Can Learn From Coronavirus “Round One”
While hospitals were able to add beds more quickly than experts realized they could, some other resources were harder to come by. Masks, gowns and other personal protective equipment were tough to get. So were ventilators. Anesthesia agents and dialysis medications were in short supply. And every additional bed meant the need for more doctors, nurses and respiratory therapists.
In early February, before any cases were discovered in New York, Northwell purchased $5 million in PPE, ventilators and lab supplies just in case, Lynam said. “It turned out to be a wise move,” he said. “What’s clear is that you can never have enough.”
Northwell has spent $42 million on PPE alone. “We were going through 10,000 N95 masks a day, just a crazy amount,” he said. “One of the lessons learned is you have to stockpile the PPE. There’s got to be a better procurement process in place.”
If there’s one thing the system could have done differently, Lynam said, it’s bringing in more temporary nurses earlier. Northwell brought in 500 nurses from staffing agencies. “They came in a week later than they should have.”
Dr. Robert Wachter, chair of the department of medicine at the University of California, San Francisco, agreed. “I’ve helped run services in hospitals for 25 years,” he said. “I’ve probably given two minutes of thought to the notions of supply chains and PPE. You realize that is absolutely central to your preparedness. That’s a lesson.”
Experts and hospital leaders agree that everyone can do better if another wave hits. Here’s what that entails:
Having testing readily available, as it now is, to more quickly spot a resurgence of the virus.
Stocking up now on PPE and other supplies. “We definitely have to stockpile PPE by the fall,” Gershon of NYU said. “We have to. … [Hospitals and health departments] have to really get those contracts nailed down now. They should have been doing this, of course, all the time, but no one expected this kind of event.”
Being able to quickly move personnel and equipment from one hot spot to the next.
Planning for how to care for those with other medical ailments but who are scared of contracting COVID-19. “We have to have some sort of a mechanism by which we can offer people assurance that if they come in, they won’t get sick,” Jha said. “We can’t repeat in the fall what we just did in the spring. It’s terrible for hospitals. It’s terrible for patients.”
Providing mental health resources for front-line caregivers who have been deeply affected by their work. The intensity of the work, combined with watching patients suffer and die alone, was immensely taxing.
Coming up with ways to allow visitors in the hospital. Wachter said the visitor bans in place at many hospitals, though well intentioned, may have backfired. “When all hell was breaking loose and we were just doing the best we could in the face of a tsunami, it was reasonable to just keep everybody out,” he said. “We didn’t fully understand how important that was for patients, how much it might be contributing to some people not coming in for care when they really should have.”
Lynam of Northwell said he’s worried about what lies ahead. “You look back on the 1918 Spanish flu and the majority of victims from that died in the second wave. … We don’t know what’s coming on the second wave. There may be some folks who say you’re paranoid, but you’ve got to be prepared for the worst.”
With the acceleration of consumer and provider adoption of telehealth, a quarter of a trillion dollars in current U.S. healthcare spend could be done virtually, according to a new report.
During the COVID-19 pandemic, consumer adoption of telehealth has skyrocketed, from 11% of U.S. consumers using telehealth in 2019 to 46% of consumers now using telehealth to replace canceled healthcare visit, according to consulting firm McKinsey & Company’s COVID-19 consumer survey conducted in April.
McKinsey’s survey also found that about 76% of consumers say they are highly or moderately likely to use telehealth in the future. Seventy-four percent of people who had used telehealth reported high satisfaction.
Health systems, independent practices, behavioral health providers, and other healthcare organizations rapidly scaled telehealth offerings to fill the gap between need and canceled in-person care. Providers are ready for the shift to virtual care: 57% view telehealth more favorably than they did before COVID-19 and 64% are more comfortable using it, according to McKinsey’s recent provider surveys.
Pre-COVID-19, the total annual revenues of U.S. telehealth players were an estimated $3 billion, with the largest vendors focused on virtual urgent care.
Telehealth is now poised to take a bigger share of the healthcare market as McKinsey estimates that up to $250 billion, or 20% of all Medicare, Medicaid, and commercial outpatient, office, and home health spend could be done virtually.
The consulting firm looked at anonymized claims data representative of commercial, Medicare, and Medicaid utilization.
The company’s claims-based analysis suggests that approximately 20% of all emergency room visits could potentially be avoided via virtual urgent care offerings, 24% of healthcare office visits and outpatient volume could be delivered virtually, and an additional 9% “near-virtually.”
Up to 35% of regular home health attendant services could be virtualized, and 2% of all outpatient volume could be shifted to the home setting, with tech-enabled medication administration.
Many of the dynamics that have helped to expand telehealth adoption are likely to be in place for at least the next 12 to 18 months, as concerns about COVID-19 remain until a vaccine is widely available.
Going forward, telehealth can increase access to necessary care in areas with shortages, such as behavioral health, improve the patient experience, and improve health outcomes, McKinsey reported.
Providers and patients are concerned that recent federal and state policies expanding access to telehealth will be rolled back once the emergency period ends.
Industry groups, including the College of Healthcare Information Management Executives (CHIME), are calling on lawmakers to ensure the changes enacted by Congress and the administration become permanent.
McKinsey’s research indicates providers’ concerns about telehealth include security, workflow integration, effectiveness compared with in-person visits, and the future for reimbursement.
“We call on Medicare and all other insurers to continue to fund telehealth programs and work collaboratively on coverage and coding to lessen provider burden. We cannot go back to pre-COVID telehealth; instead, we must go forward. Patients will demand it and providers will expect it,” CHIME CEO and President Russell Branzell said in a recent statement.
Telehealth also is drawing bipartisan support. Senator Marsha Blackburn, R-Tenn., urged Congress to “continue to support this expansion and codify the administration’s changes to support the health needs of the American people,” in a recent news release.
Rep. Robin Kelly, D-Illinois, is introducing a bill directing HHS Secretary Alex Azar to oversee a telehealth study looking at the technology’s impact on health and costs, Politico reported in its newsletter today.
Taking advantage of the telehealth opportunity
Healthcare providers and payers will need to take action to ensure the full potential of telehealth is realized after the crisis has passed, according to McKinsey.
There continue to be challenges as providers cite concerns about telehealth include security, workflow integration, effectiveness compared with in-person visits, and the future for reimbursement. There also is a gap between consumers’ interest in telehealth (76%) and actual usage (46%). Factors such as lack of awareness of telehealth offerings and understanding of insurance coverage are some of the drivers of this gap.
“The current crisis has demonstrated the relevance of telehealth and created an opening to modernize the care delivery system,” McKinsey consultants wrote. “Healthcare systems that come out ahead will be those who act decisively, invest to build capabilities at scale, work hard to rewire the care delivery model, and deliver distinctive high-quality care to consumers.”
McKinsey outlined steps industry stakeholders should take to drive the growth of telehealth.
Payers: Health plans should look to optimize provider networks and accelerate value-based contracting to incentivize telehealth. Align incentives for using telehealth, particularly for chronic patients, with the shift to risk-based payment models.
Payers also should build virtual health into new product designs to meet changing consumer preferences, This new design may include virtual-first networks, digital front-door features (for example, e-triage), seamless “plug-and-play” capabilities to offer innovative digital solutions, and benefit coverage for at-home diagnostic kits.
Health systems: Hospitals and health systems should accelerate the development of an overall consumer-integrated “front door.” Consider what the integrated product will initially cover beyond what currently exists and integrate with what may have been put in place in response to COVID-19, for example, e-triage, scheduling, clinic visits, record access.
Providers also should build the capabilities and incentives of the provider workforce to support virtual care, including, workflow design, centralized scheduling, and continuing education. And, health systems need to take steps to measure the value of virtual care by quantifying clinical outcomes, access improvement, and patient/provider satisfaction. Include the potential value from telehealth when contracting with payers for risk models to manage chronic patients, McKinsey said.
Investors and health technology firms: These players also can support the new reality of expanded telehealth services. Technology firms should consider developing scenarios on how virtual health will evolve and when, including how usage evolved post-COVID-19, based on expected consumer preferences, reimbursement, CMS and other regulations.
Investors also should develop potential options and define investment strategies based on the expected virtual health future. For example, combinations of existing players/platforms, linkages between in-person and virtual care offerings and create sustainable value. Investors and technology companies also canidentify the assets and capabilities to implement these options, including specific assets or capabilities to best enable the play, and business models that will deliver attractive returns.
Dubai is proud to introduce its impressive fleet of the “world’s largest ambulances,” or “Mercedes-Benz large-capacity ambulances” which were created to give rapid medical assistance in the event of major emergencies with large numbers of causalities. These new emergency vehicles offer a fully-equipped, mobile clinic with an intensive-care unit and an operating room.
Equipped with an X-ray unit and ultrasonic equipment for further evaluation, each super ambulance bus carries 12,000 liters of oxygen, which ensures a dependable supply for up to three days. With the press of a button, oxygen masks fall from special holders, and the oxygen flow to each mask can be individually controlled.
They’re also equipped with an ECG and an InSpectra shock monitor, which monitors the oxygen saturation in tissue-matter and warns doctors of the onset of shock minutes before it occurs. This unit can also detect and monitor internal bleeding. If an emergency caesarian birth is needed, essential obstetrical instruments, including an incubator, are on board.
Seriously ill people avoided hospitals and doctors’ offices. Patients need to return. It’s safe now.
More than 100,000 Americans have died from Covid-19. Beyond those deaths are other casualties of the pandemic — Americans seriously ill with other ailments who avoided care because they feared contracting the coronavirus at hospitals and clinics.
The toll from their deaths may be close to the toll from Covid-19. The trends are clear and concerning. Government orders to shelter in place and health care leaders’ decisions to defer nonessential care successfully prevented the spread of the virus. But these policies — complicated by the loss of employer-provided health insurance as people lost their jobs — have had the unintended effect of delaying care for some of our sickest patients.
To prevent further harm, people with serious, complex and acute illnesses must now return to the doctor for care.
Across the country, we have seen sizable decreases in new cancer diagnoses (45 percent) and reports of heart attacks (38 percent) and strokes (30 percent). Visits to hospital emergency departments are down by as much as 40 percent, but measures of how sick emergency department patients are have risen by 20 percent, according to a Mayo Clinic study, suggesting how harmful the delay can be. Meanwhile, non-Covid-19 out-of-hospital deaths have increased, while in-hospital mortality has declined.
These statistics demonstrate that people with cancer are missing necessary screenings, and those with heart attack or stroke symptoms are staying home during the precious window of time when the damage is reversible. In fact, a recent poll by the American College of Emergency Physicians and Morning Consult found that 80 percent of Americans say they are concerned about contracting the coronavirus from visiting the emergency room.
Unfortunately, we’ve witnessed grievous outcomes as a result of these delays. Recently, a middle-aged patient with abdominal pain waited five days to come to a Mayo Clinic emergency department for help, before dying of a bowel obstruction. Similarly, a young woman delayed care for weeks out of a fear of Covid-19 before she was transferred to a Cleveland Clinic intensive care unit with undiagnosed leukemia. She died within weeks of her symptoms appearing. Both deaths were preventable.
The true cost of this epidemic will not be measured in dollars; it will be measured in human lives and human suffering. In the case of cancer alone, our calculations show we can expect a quarter of a million additional preventable deaths annually if normal care does not resume. Outcomes will be similar for those who forgo treatment for heart attacks and strokes.
Over the past 12 weeks, hospitals deferred nonessential care to prevent viral spread, conserve much-needed personal protective equipment and create capacity for an expected surge of Covid-19 patients. During that time, we also have adopted methods to care for all patients safely, including standard daily screenings for the staff and masking protocols for patients and the staff in the hospital and clinic. At this point, we are gradually returning to normal activities while also mitigating risk for both patients and staff members.
The Covid-19 crisis has changed the practice of medicine in fundamental ways in just a matter of months. Telemedicine, for instance, allowed us to pivot quickly from in-person care to virtual care. We have continued to provide necessary care to our patients while promoting social distancing, reducing the risk of viral spread and recognizing patients’ fears.
Both Cleveland Clinic and Mayo Clinic have gone from providing thousands of virtual visits per month before the pandemic to hundreds of thousands now across a broad range of demographics and conditions. At Cleveland Clinic, 94 percent of diabetes patients were cared for virtually in April.
While virtual visits are here to stay, there are obvious limitations. There is no substitute for in-person care for those who are severely ill or require early interventions for life-threatening conditions. Those are the ones who — even in the midst of this pandemic — must seek the care they need.
Patients who need care at a clinic or hospital or doctor’s office should know they have reduced the risk of Covid-19 through proven infection-control precautions under guidelines from the Centers for Disease Control and Prevention. We’re taking unprecedented actions, such as restricting visiting hours, screening patient and caregiver temperatures at entrances, encouraging employees to work from home whenever possible, providing spaces that allow for social distancing, and requiring proper hand hygiene, cough etiquette and masking.
All of these strategies are intended to significantly reduce risk while allowing for vital, high-quality care for our patients.
The novel coronavirus will not go away soon, but its systemic side effects of fear and deferred care must.
We will continue to give vigilant attention to Covid-19 while urgently addressing the other deadly diseases that haven’t taken a pause during the pandemic. For patients with medical conditions that require in-person care, please allow us to safely care for you — do not delay. Lives depend on it.
A new analysis from the CDC this week confirmed what we have been hearing anecdotally from health systems for several weeks—as the coronavirus lockdown took hold, there was a precipitous drop in visits to hospital emergency departments. According to the study, visits were down by 42 percent in the month of April compared to the previous year, and despite a rebound in May, were still 26 percent lower than a year ago. Visits in the Northeast dropped the most, as did those among women, and children under 14.
Although visits for minor ailments and symptoms declined the most, even more disconcerting was the drop in visits for chest pain, echoing the concern we’ve heard in many parts of the country that many patients may have suffered minor heart attacks without being treated, or may have waited to be seen until significant damage had been done.
As non-emergent visits have begun to return to many facilities, we continue to hear that emergency department and urgent care volume remains relatively low.
Survey data indicate that patients are fearful of becoming infected with coronavirus if they visit healthcare facilities—especially, it seems, ones where they’ll be forced to wait.
While many providers are investing in messaging campaigns to assure patients it’s safe to return, this nightmarish first-person account by one healthcare insider provides a useful cautionary tale.
Visiting a surgeon for a pre-op consult, she found the experience of visiting a COVID-era hospital downright dystopian. Simply touting safety precautions by itself won’t make patients more comfortable—they’ll need to see and feel that measures are in place to make time spent in a care setting as efficient and reassuring as possible. Otherwise, like the insider in question, they’ll take their business elsewhere. There’s work to be done.
After months of lock down, hospitals are eager to get patients back for routine care and elective procedures.
An executive at a Palm Beach hospital stands between a box of surgical masks and a Purell dispenser.
“We understand you haven’t been inside our hospitals for some time,” she says to the camera. The executive is delivering her line for a promotional video intended to get people back to hospitals after almost three months of avoiding the place at all costs.
Moments later, the film crew records her chatting with a vascular surgeon in an idled operating room, who soothingly reassures that a hospital is the cleanest place to be outside your home. “The hospital is safer than the grocery store,” the doctor says.
The video published on YouTube in mid-May is part of a marketing campaign by Tenet Healthcare, which operates 65 hospitals and about 250 ambulatory surgery centers. It’s one attempt to solve a problem the entire health-care industry faces: Most patients vanished when Covid-19 swept the country.
Billions in Losses
Much of routine health care came to a halt in March as hospitals cleared space for an expected wave of Covid-19 patients and authorities ordered a halt to surgeries and other procedures that could be postponed. The decline in volume has clobbered hospital finances, with the industry estimating it is losing $50 billion a month.
Emergency visits dropped by 42% in four weeks in April compared to the same period last year, the Centers for Disease Control reported June 3. The number of U.S. patients getting hospital care dropped by more than half in late March and early April compared to 2019, according to data from Strata Decision Technology, which provides software to hospitals.
Some of that rebounded modestly in May as distancing rules eased, but hospital volume is nowhere near pre-Covid levels. With the pandemic ongoing and many states still confirming hundreds of new cases daily, patients are hesitating to rush back to hospitals.
“The main thing that really is a gating factor at this point is patient comfort,” Tenet President and Chief Operating Officer Saumya Sutaria said at a recent virtual conference with investors. Tenet declined interview requests.
Free Masks
To counter the public’s fears, hospitals publicize what they’re doing to keep patients safe. They’re handing out masks at the door and spacing out chairs in waiting rooms. They’re steering Covid-19 patients to dedicated sites and testing staff regularly.
Hospitals need to show patients that their facilities are safe. At Catholic hospital chain Trinity Health, that includes moving patients through “Covid-free” zones with separate doors, elevators and waiting areas.
“We can put all of the outreach and marketing in place, but it’s only as effective as the people who execute those strategies,” said Julie Spencer Washington, Trinity’s chief marketing and communications officer.
The question for the entire industry is how quickly patients come back. The answer will depend on a constellation of related variables, including how reluctant people are to resume care, and the course of the pandemic. Future surges could force hospitals to shut down regular care again — and spook patients further.
Hospitals and doctors are going to have to do as much as they can as fast as they can until they can’t anymore,” said Lisa Bielamowicz, co-founder of consultancy Gist Healthcare.
Many patients, on the other hand, are in no rush. “They’re waiting and watching rather than pulling the trigger and going to see the doctor like they would have in the past,” Bielamowicz said.
The calculation for the health-care industry is different than for many other service businesses resuming operations. A hospital procedure or even a check-up is more intimate than a meal out.
For procedures that require in-patient rehab stints for recovery, the havoc Covid-19 has brought to nursing homes adds another layer of concern. “Those places seem like deathtraps now, so it’s much harder to bring back those patients because you need to find an alternative way for them to rehab,” Bielamowicz said.
And the biggest consumers of health care are the elderly and the chronically ill, the very people Covid-19 most threatens. “From personal discussions with my patients, the older and more co-morbidities that any individual has, the more nervous they are about returning,” said Shauna Gulley, chief clinical officer at Centura Health, which has hospitals in Colorado and Kansas.
Patients with serious ongoing needs like cancer treatment or emergencies like heart attacks and strokes have continued to get care. And many medical problems resolve on their own. The decline in those visits – for a migraine headache, for example – reduces providers’ revenue but may not harm patients in the long-term.
While people often go to the emergency room for needs better treated in other settings, now the concern is the opposite: That true medical emergencies will be neglected.
Ascension, the nation’s largest Catholic hospital chain, has purchased billboards that say “Don’t delay ER care.” On hospital websites and social media posts, Tenet facilities reminded patients that “Emergencies Can’t wait. We’re Open & Safe.”
Deferred Care
Doctors fear that some patients will defer needed care too long, allowing progressive conditions to deteriorate. Clinicians at Maimonides Medical Center in Brooklyn, New York, have seen patients arrive sicker because they didn’t come earlier, said Ken Gibbs, the hospital’s CEO.
“There are unmet needs, I think that’s clear,” he said. “And I think the data on that will emerge, but it will take time.”
Maimonides treated 471 Covid patients at the peak on April 9, Gibbs said, and still had about 100 in late May. The hospital has applied for a waiver from New York State to resume elective surgeries, which are still on hold in New York City.
Some hospitals are preparing for a lasting dent in their revenue. For years, health economists have pointed to waste in the health-care system, with the estimated cost of unnecessary treatments in the hundreds of billions of dollars. Covid-19 may demonstrate that patients are willing to forego some of that care or opt for more conservative treatment.
People who had delayed back surgeries, for example, may now decide that doing physical therapy at home is good enough, said Marvin O’Quinn, president and chief operating officer at CommonSpirit Health, a large Catholic hospital system.
“We’ve all talked about too much intervention in health care in the past,” he said. “I think we’ll see a new normal in terms of what patients want to do and what doctors want to do, and we will have to adjust to that.”
HENRY KOTULA 