Now the U.S. Has Lots of Ventilators, but Too Few Specialists to Operate Them

A patient was placed on a ventilator in a hospital in Yonkers, N.Y., in April.

As record numbers of coronavirus cases overwhelm hospitals across the United States, there is something strikingly different from the surge that inundated cities in the spring: No one is clamoring for ventilators.

The sophisticated breathing machines, used to sustain the most critically ill patients, are far more plentiful than they were eight months ago, when New York, New Jersey and other hard-hit states were desperate to obtain more of the devices, and hospitals were reviewing triage protocols for rationing care. Now, many hot spots face a different problem: They have enough ventilators, but not nearly enough respiratory therapists, pulmonologists and critical care doctors who have the training to operate the machines and provide round-the-clock care for patients who cannot breathe on their own.

Since the spring, American medical device makers have radically ramped up the country’s ventilator capacity by producing more than 200,000 critical care ventilators, with 155,000 of them going to the Strategic National Stockpile. At the same time, doctors have figured out other ways to deliver oxygen to some patients struggling to breathe — including using inexpensive sleep apnea machines or simple nasal cannulas that force air into the lungs through plastic tubes.

But with new cases approaching 200,000 per day and a flood of patients straining hospitals across the country, public health experts warn that the ample supply of available ventilators may not be enough to save many critically ill patients.

“We’re now at a dangerous precipice,” said Dr. Lewis Kaplan, president of the Society of Critical Care Medicine. Ventilators, he said, are exceptionally complex machines that require expertise and constant monitoring for the weeks or even months that patients are tethered to them. The explosion of cases in rural parts of Idaho, Ohio, South Dakota and other states has prompted local hospitals that lack such experts on staff to send patients to cities and regional medical centers, but those intensive care beds are quickly filling up.

Public health experts have long warned about a shortage of critical care doctors, known as intensivists, a specialty that generally requires an additional two years of medical training. There are 37,400 intensivists in the United States, according to the American Hospital Association, but nearly half of the country’s acute care hospitals do not have any on staff, and many of those hospitals are in rural areas increasingly overwhelmed by the coronavirus.

“We can’t manufacture doctors and nurses in the same way we can manufacture ventilators,” said Dr. Eric Toner, an emergency room doctor and senior scholar at the Johns Hopkins Center for Health Security. “And you can’t teach someone overnight the right settings and buttons to push on a ventilator for patients who have a disease they’ve never seen before. The most realistic thing we can do in the short run is to reduce the impact on hospitals, and that means wearing masks and avoiding crowded spaces so we can flatten the curve of new infections.”

Medical association message boards in states like Iowa, Oklahoma and North Dakota are awash in desperate calls for intensivists and respiratory therapists willing to temporarily relocate and help out. When New York City and hospitals in the Northeast issued a similar call for help this past spring, specialists from the South and the Midwest rushed there. But because cases are now surging nationwide, hospital officials say that most of their pleas for help are going unanswered.

Dr. Thomas E. Dobbs, the top health official in Mississippi, said that more than half the state’s 1,048 ventilators were still available, but that he was more concerned with having enough staff members to take care of the sickest patients.

“If we want to make sure that someone who’s hospitalized in the I.C.U. with the coronavirus has the best chance to get well, they need to have highly trained personnel, and that cannot be flexed up rapidly,” he said in a news briefing on Tuesday.

Dr. Matthew Trump, a critical care specialist at UnityPoint Health in Des Moines, said that the health chain’s 21 hospitals had an adequate supply of ventilators for now, but that out-of-state staff reinforcements might be unlikely to materialize as colleagues fall ill and the hospital’s I.C.U. beds reach capacity.

“People here are exhausted and burned out from the past few months,” he said. “I’m really concerned.”

The domestic boom in ventilator production has been a rare bright spot in the country’s pandemic response, which has been marred by shortages of personal protective equipment, haphazard testing efforts and President Trump’s mixed messaging on the importance of masks, social distancing and other measures that can dent the spread of new infections.

Although the White House has sought to take credit for the increase in new ventilators, medical device executives say the accelerated production was largely a market-driven response turbocharged by the national sense of crisis. Mr. Trump invoked the wartime Defense Production Act in late March, but federal health officials have relied on government contracts rather than their authority under the act to compel companies to increase the production of ventilators.

Scott Whitaker, president of AdvaMed, a trade association that represents many of the country’s ventilator manufacturers, said the grave situation had prompted a “historic mobilization” by the industry. “We’re confident that our companies are well positioned to mobilize as needed to meet demand,” he said in an email.

Public health officials in Minnesota, Mississippi, Utah and other states with some of the highest per capita rates of infection and hospitalization have said they are comfortable with the number of ventilators currently in their hospitals and their stockpiles.

Mr. Whitaker said AdvaMed’s member companies were making roughly 700 ventilators a week before the pandemic; by the summer, weekly output had reached 10,000. The juggernaut was in part fueled by unconventional partnerships between ventilator companies and auto giants like Ford and General Motors.

Chris Brooks, chief strategy officer at Ventec Life Systems, which collaborated with G.M. to fill a $490 million contract for the Department of Health and Human Services, said the shared sense of urgency enabled both companies to overcome a thicket of supply-chain and logistical challenges to produce 30,000 ventilators over four months at an idled car parts plant in Indiana. Before the pandemic, Ventec’s average monthly output was 100 to 200 machines.

“When you’re focused with one team and one mission, you get things done in hours that would otherwise take months,” he said. “You just find a way to push through any and all obstacles.”

Despite an overall increase in the number of ventilators, some researchers say many of the new machines may be inadequate for the current crisis. Dr. Richard Branson, an expert on mechanical ventilation at the University of Cincinnati College of Medicine and an author of a recent study in the journal Chest, said that half of the new devices acquired by the Strategic National Stockpile were not sophisticated enough for Covid-19 patients in severe respiratory distress. He also expressed concern about the long-term viability of machines that require frequent maintenance.

“These devices were not built to be stockpiled,” he said.

The Department of Health and Human Services, which has acknowledged the limitations of its newly acquired ventilators, said the stockpile — nine times as large as it was in March — was well suited for most respiratory pandemics. “These stockpiled devices can be used as a short-term, stopgap buffer when the immediate commercial supply is not sufficient or available,” the agency said in a statement.

Projecting how many people will end up requiring mechanical breathing assistance is an inexact science, and many early assumptions about how the coronavirus affects respiratory function have evolved.

During the chaotic days of March and April, emergency room doctors were quick to intubate patients with dangerously low oxygen levels. They subsequently discovered other ways to improve outcomes, including placing patients on their stomachs, a protocol known as proning that helps improve lung function. The doctors also learned to embrace the use of pressurized oxygen delivered through the nose, or via BiPAP and CPAP machines, portable devices that force oxygen into a patient’s airways.

Many health care providers initially hesitated to use such interventions for fear the pressurized air would aerosolize the virus and endanger health care workers. The risks, it turned out, could be mitigated through the use of respirator masks and other personal protective gear, said Dr. Greg Martin, the chief of pulmonary and critical care at Grady Health Systems in Atlanta.

“The familiarity of taking care of so many Covid patients, combined with good data, has just made everything we do 100 times easier,” he said.

Some of the earliest data about the perils of intubating coronavirus patients turned out to be incomplete and misleading. Dr. Susan Wilcox, a critical care specialist at Massachusetts General Hospital, said many providers were spooked by data that suggested an 80 percent mortality rate among ventilated coronavirus patients, but the actual death rate turned out to be much lower. The mortality rate at her hospital, she said, was about 25 to 30 percent.

“Some people were saying that we should intubate almost immediately because we were worried patients would crash and have untoward consequences if we waited,” she said. “But we’ve learned to just go back to the principles of good critical care.”

Survival rates have increased significantly at many hospitals, a shift brought about by the introduction of therapeutics like dexamethasone, a powerful steroid that Mr. Trump took when he was hospitalized with the coronavirus. The changing demographics of the pandemic — a growing proportion of younger patients with fewer health risks — have also played a role in the improving survival rates.

Dr. Nikhil Jagan, a critical care pulmonologist at CHI Health, a hospital chain that serves Iowa, Kansas and Nebraska, said many of the coronavirus patients who were arriving at his emergency room now were less sick than the patients he treated in the spring.

“There’s a lot more awareness about the symptoms of Covid-19,” he said. “The first go-around, when people came in, they were very sick right off the bat and in respiratory distress or at the point of respiratory failure and had to be intubated.”

But the promising new treatments and enhanced knowledge can go only so far should the current surge in cases continue unabated. The country passed 250,000 deaths from the coronavirus last week, a reminder that many critically ill patients do not survive. The daily death toll has been rising steadily and is approaching 2,000.

“Ventilators are important in critical care but they don’t save people’s lives,” said Dr. Branson of the University of Cincinnati. “They just keep people alive while the people caring for them can figure out what’s wrong and fix the problem. And at the moment, we just don’t have enough of those people.”

For now, he said there was only one way out the crisis: “It’s not that hard,” he said. “Wear a mask.”

Recovery of medical staffing firms will lag behind hospitals, analysts say

https://www.healthcaredive.com/news/recovery-of-medical-staffing-firms-will-lag-behind-hospitals-analysts-say/580171/

COVID-19 Triggers Cash Need, Lenders Tighten Reins | PYMNTS.com

Dive Brief:

  • 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.

 

 

 

 

Envision Healthcare considering bankruptcy filing

https://mailchi.mp/0d4b1a52108c/the-weekly-gist-april-24-2020?e=d1e747d2d8

KKR-backed Envision Healthcare hires restructuring advisers ...

 

National physician staffing firm Envision Healthcare is considering filing for bankruptcy, according a report from Bloomberg. Sources say the company, backed by private equity (PE) firm KKR, which acquired Envision for $9.9B in June 2018, has hired restructuring advisors and is working with an investment bank. The abrupt halt to elective surgeries and reduction in emergency room volumes due to COVID-19 has caused Envision’s business to shrink by 65 to 75 percent in just two weeks at its 168 open ambulatory surgery centers (ASCs), compared to the same time period last year.

The Nashville-based company, which employs over 25,000 physicians and advanced practitioners, has already been reducing pay for providers and executives, in addition to implementing temporary furloughs. Envision is also struggling with a debt load of more than $7B, resulting from its 2018 leveraged buyout, and has been unable to convince its bondholders to approve a debt swap.

It remains to be seen whether Envision will be a bellwether for how other PE-backed physician groups will weather the ongoing COVID crisis. While Envision’s composition of mainly hospital- and ASC-based providers, coupled with its huge debt load, leave it on especially shaky financial footing, many PE-backed physician groups will struggle this year to achieve anything close to the 20 percent annual rate of return often promised to investors.

If high-profile PE-backed groups like Envision end up declaring bankruptcy, it will likely impact the calculus of the many independent practices which may have previously looked to PE firms for acquisitionand temper the enthusiasm of investors, who might see physician staffing and practice roll-ups as less attractive as volumes continue to fluctuate.

 

 

 

UnitedHealth likely to keep squeezing physician staffing firms

https://www.healthcaredive.com/news/unitedhealth-likely-to-keep-squeezing-physician-staffing-firms/573679/

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The nation’s largest private insurer has been terminating its contracts with physician staffing firms in a bid to extract lower prices, part of a years-long pattern analysts say could spur other payers to follow.

UnitedHealthcare contends it is simply trying to curb the rising cost of healthcare by driving out high-cost providers that charge far more than the median rate in its network. The payer said it had hoped to keep these firms in network “at rates that reflect fair market prices,” a UnitedHealthcare spokesperson told Healthcare Dive.

The most recent action targeted Mednax, a firm that provides specialty services including anesthesia, neonatology and high-risk obstetrics in both urban and rural areas. United cut Mednax contracts in four states, pushing those providers out of network, potentially putting patients at risk of balance bills.

United also recently canceled its in-network contracts with U.S. Anesthesia Partners in Texas, starting in April, which caused Moody’s to change its outlook to negative for the provider group because the contracts represent 10% of its annual consolidated revenue.

These latest moves to end relationships with certain physician staffing firms seem to have escalated in recent years, Sarah Kahn, a credit analyst for S&P Global, told Healthcare Dive.

Since the insurer’s 2018 tussle with ER staffing firm Envision, “it’s sort of ramped up and become more aggressive and more abrupt and more pervasive,” Kahn said of the contract disputes.

 

United said the volume of negotiations it’s involved in has not changed in recent years, and added that it expects to renegotiate the same amount of contracts in 2020 that it did in 2019. However, United pointed a finger at a small number of physician staffing firms, backed by private equity, that are attempting to apply pressure on United to preserve the same high rates.

Private equity firms have been increasingly interested in healthcare over the past few years, accelerating acquisitions of medical practices from 2013 to 2016. Private equity acquired 355 physician practices, representing 1,426 sites of care and more than 5,700 physicians over that time frame, according to recent research in JAMA. The firms had a particular focus on anesthesiology with 69 practices acquired, followed by emergency physicians at 43.

Mednax is a publicly traded company. But Envision is owned by investment firm KKR; TeamHealth is owned by private equity firm Blackstone; and U.S. Anesthesia Partners is backed by Welsh, Carson, Anderson & Stowe.

 

Proposed legislation around surprise billing may be influencing United’s actions, Kailash Chhaya, vice president and senior analyst at Moody’s, told Healthcare Dive. Congress has been weighing legislation that seeks to eliminate surprise billing, mainly through two vehicles, either using benchmark rates or arbitration.

If Congress ultimately decides on a bill that uses benchmark rates, or ties reimbursement for out-of-network providers to a benchmark rate (or average), it would benefit insurers like United to lower its average rate for certain services, Chhaya said. One way to do that is to end relationships with high-cost providers.

“It would help payers like UnitedHealth if that benchmark rate is low,” Chhaya said.

In late 2018, United threatened to drop Envision from its network, alleging the firm’s rates were responsible for driving up healthcare costs, according to a letter the payer sent hundreds of hospitals across the country. United and Envision eventually agreed to terms, but United seemed to outmuscle Envision as the deal secured “materially lower payment rates for Envision” that resulted in lower earnings, S&P Global analysts wrote in a recent report.

In 2019, United began terminating its contracts with TeamHealth, which has a special focus on emergency medicine. The terminations affect two-thirds of TeamHealth’s contracts through July 1. The squeeze from United caused Moody’s to also change Team Health’s outlook to negative as an eventual agreement would likely mean lower reimbursement and lower profitability for company, the ratings agency said.

“They’re trying to lower their payments to providers. Period,” David Peknay, director at S&P Global, told Healthcare Dive.​

 

Data shows prices — not usage — is driving healthcare spending. Physician staffing firms are frequently used for ER services and the ER and outpatient surgery experienced the largest growth in spending between 2014 and 2018, according to data from the Health Care Cost Institute.

United said it had been negotiating with TeamHealth since 2017 and does not believe TeamHealth should be paid significantly more than other in-network ER doctors for the same services. United alleges its median rate for chest pains is $340. But if a TeamHealth doctor provides the care it charges $1,508.​

“As Team Health continues to see more aggressive and inappropriate behavior by payors to either reduce, delay, or deny payments, we have increased our investment in legal resources to address specific situations where we believe payor behavior is inappropriate or unlawful,” according to a statement provided to Healthcare Dive.

TeamHealth said it will not balance bill patients in the interim.

 

The pressure from payers, particularly United, is unlikely to relent. The payer insures more than 43 million people in the U.S. through its commercial and public plans.

“I don’t think anyone is safe from such abrupt terminations,” Kahn said. However, United disputes the characterization of abruptly terminating contracts and says in many cases it has been negotiating with providers to no avail.

Likely targets in the future may include firms with a focus on emergency services, which tend to be high-cost areas, S&P’s analysts said. In their latest report, Kahn and Peknay pointed to The Schumacher Group, which is the third-largest player in emergency staffing services. However, it commands a market share of less than 10%, far less than its rivals Envision and TeamHealth.

Smaller firms may not be able to weather the pressure as effectively as very large staffing organizations.

For those smaller groups, it may be wise for them “to sit tight on their cash or prepare from some pressure,” Kahn said.

Although some believe it may influence other payers to follow suit, Dean Ungar, vice president and senior analyst with Moody’s, said United may be uniquely placed to exert this pressure because it has its own group of providers it can use and considerable scale.

“They are better positioned to play hardball,” Ungar said.

 

 

 

 

Physician staffing firm suing patients

https://www.axios.com/newsletters/axios-vitals-bd00103b-e940-45bb-ad9a-a4576971fc39.html?utm_source=newsletter&utm_medium=email&utm_campaign=newsletter_axiosvitals&stream=top

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An emergency room staffing firm owned by TeamHealth has filed thousands of lawsuits against patients in Memphis in the last few years, ProPublica and MLK50 report.

This is a collision of two storylines: the aggressive billing practices of private equity-backed health care companies, and providers’ decision to take patients to court to collect their medical debts.

  • Media reports have, until now, mostly focused on hospitals’ lawsuits, but ProPublica and MLK50’s reporting suggest the practice could be more widespread.

Between the lines: TeamHealth has already been in hot water for its role in surprise billing.

  • Emergency room physicians send patients surprise medical bills more often than other specialties, especially physicians employed by TeamHealth.
  • These doctors then have leverage to obtain higher in-network payment rates, making the practice lucrative.
  • The group is also one of the main funders of the dark-money group that has run millions in ads against what was Congress’ leading solution to surprise medical bills.
  • The company was acquired by the Blackstone Group in 2017.

By the numbers: The Memphis subsidiary Southeastern Emergency Physicians has filed more than 4,800 lawsuits against patients in Shelby County General Sessions Court since 2017, per ProPublica and MLK50.

  • TeamHealth said last week, after receiving questions from reporters, that it will no longer sue patients and won’t pursue the lawsuits it’s already filed.