Category Archives: Hospital

‘We’re going to come out of this winning:’ Northwell CEO on labor challenges and the system’s biggest growth area

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New Hyde Park, N.Y.-based Northwell Health began 2023 with a low, but positive operating margin, but labor costs are expected to increase again this year on the back of recent union activity in the state. 

To offset such increases that were not anticipated in the 2023 budget, Northwell is evaluating opportunities to reduce expenses and increase revenue across the health system, which includes 21 hospitals and about 83,000 employees.

Michael Dowling, CEO of Northwell, spoke to Becker’s Hospital Review about the health system’s biggest challenge this year, how it approaches cost-cutting and why outpatient care is its biggest growth area.

Editor’s note: Responses are lightly edited for length and clarity.

Question: Many health systems saw margins dip last year amid rising inflation, increased labor costs and declining patient volumes. How have you led Northwell through the challenges of last year? 

Michael Dowling: We ended 2022 with a low, but positive margin. We’ve been coming back from COVID quite successfully, and we’re back pretty much in all areas to where we were prior to the pandemic. Volumes have returned and we’re very busy. We came into 2023 with a positive budget and a positive margin. We anticipate that you’re always going to have challenges and disturbances, but it’s important to stay focused and deal with it. We have a very detailed strategic plan, which outlines our various goals, and we stick to it. 

Q: What is your top priority today?

MD: The biggest issue for us today is labor costs. We have lots of union activity in New York at the moment. There were various nurse strikes in New York City at the beginning of the year. None of our hospitals were involved in those deliberations, but some of those hospitals agreed to contracts that have increases that were not anticipated in anybody’s 2023 budget. That’s going to have an effect on us. We have negotiations ongoing with the nurses’ union, and have 10 unions overall. About 90 percent of Northwell’s facilities have unions, so the bottom line is we are going to have expenses as a result of these contracts that were not anticipated in the budget. I don’t know the final number on these contracts yet, but it’s definitely going to be more than what we anticipated. 

The unions in New York get a lot of government support and have become very empowered and quite aggressive. The bottom line is there’s more expense than we anticipated in our budget, so we need to figure out how to address that. We’re looking at everything across our health system to find expense reductions or revenue enhancements to be able to make up for the increased labor costs and be optimistic about ending the year with a positive margin. But we’re in a good place and are not like some other health systems that are struggling financially. 

Q: Where are the biggest opportunities to reduce expenses or increase revenue to offset the increased labor costs?

MD: It’s a combination of a lot of things. We have a detailed capital plan that we may slow down. We hire about 300 people a week, so maybe we’ll target that hiring into specific areas and not be as broad based as we thought we could be. We will examine if we have specific programs or initiatives we can curtail without doing any damage to our core mission. It will end up being a portfolio of items; it won’t be one big thing. On the revenue side, we’re working very hard to increase our neurosurgery, cardiac, cancer and orthopedic businesses. Over the next couple of months, all of those things will be taken into consideration. The bottom line is we are going to come out of this winning.

Q: Looking three or four years down the line, where do you see the biggest growth opportunities for Northwell?

MD: Our biggest growth is in outpatient care. A lot of surgeries are moving outpatient, so we have to get ahead of that. Some think we are only a hospital system, but only about 46 percent of our business is from our hospital sector today. Home care is going to grow phenomenally, especially given the new technology that’s available. Digital health will also dramatically expand. 

We’re also looking at expanding into new geographic areas and markets. It’s about positioning your offerings in places close to where people live, so you reduce the inconvenience of people having to travel long distances for care when it should be available to them closer to home. When you do that, you increase market share. We’re constantly increasing our market share by being very aggressive about going to where the customer is and providing the highest quality care that we can. Part of that is also being able to recruit top-line, quality physicians. When you do that, you attract new business because you have competencies that you didn’t have before. It’s a combination of all of these things, but there’s certainly no limit to the opportunities in front of us. We’re not in a world of challenges; we’re in a world of opportunity. The question is are we aggressive enough and do we have enough tolerance for some risk? We need to be as aggressive as we possibly can to take advantage of some of those opportunities. 

Q: What is the biggest challenge on the horizon for Northwell?

MD: The biggest challenge is the huge growth in government payer business — Medicare and Medicaid. The problem with Medicaid — especially in a union environment — is it doesn’t cover your costs. The government is a big part of a potential future issue there. By increasing Medicaid, the more of your business becomes Medicaid and the worse you end up doing, unless you can increase your commercial payer business to continue to cross-subsidize. We also have a lot of union negotiations over the next couple of months, which will put a strain on our 2023 budget, but we will resolve it.

Q: How do you see hospitals and health systems evolving as CMS, commercial payers and patients continue to push more services to outpatient settings, where they can arguably be performed at a higher quality and lower cost?

MD: I think it’s going to continue to grow. For example, Northwell has 23 hospitals — 21 of which it owns — yet it has 890 outpatient facilities. We’ve been ahead of this curve a long time. Our primary expansion is in ambulatory care, not in-hospital care. Like I said, only 46 percent of Northwell’s total business is its hospital business. If you’re relying on the hospital to be the core provider of the future, you’re going to lose. You’ve got to take a little bit of a hit by going out and expanding your ambulatory presence. But the more you expand ambulatory and grow in the right locations, the more you increase market share, which brings more of the necessary inpatient care back to your hospitals. Our hospitals are growing and getting busier in addition to our outpatient centers because we are growing market share. If we enter a new community and see 100 people, five of them will need to be hospitalized. That’s a new market. Ambulatory cannot be disassociated from its connection to the inpatient market. 

Q: Many financial experts are projecting a recession this year. How might that affect hospitals and health systems, and how can they best prepare? 

MD: Even if we do have a recession, it doesn’t mean that people don’t get sick. In fact, people’s problems increase. Our business does not slow down if we have a recession; our business will probably increase. On the revenue side, it won’t necessarily affect our government reimbursement, which we don’t do well on anyway. The things you worry about during a recession is if employers give up the coverage of their staff. Then those employees with no insurance may go on a state Medicaid program, and that might affect hospitals. 

In the healthcare sector, even in a recession, the need for hospital services actually increases. No recession could be as bad as what we experienced during COVID, yet we managed it. We had a problem that we didn’t even understand, and we worked through it. I think healthcare deserves an extraordinary credit for what was done during COVID. If there is a recession, we will deal with it. It’s just one of those things that happens, and we will respond to it in as comprehensive a way as we can. I can’t control it, but I can control our response. Leadership to me is about having a positive disposition; basically saying that whatever happens to you, you’re going to win. 

The 20% Medicare cut coming for hospitals

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https://www.beckerspayer.com/policy-updates/the-20-medicare-cut-coming-for-hospitals.html?utm_medium=email&utm_content=newsletter

As the U.S. prepares to end the COVID-19 public health emergency, hospitals are facing a major cut in Medicare payments used to treat patients diagnosed with the disease.

Since January 2020, hospitals nationwide have received a 20 percent increase in the Medicare payment rate through the hospital inpatient prospective payment system to treat COVID-19 patients — that policy ends May 11.

The sunsetting of the three-year policy is a key concern for the AHA because of its financial implication for hospitals already struggling with increased labor costs and inflation. 

From January 2020 to November 2021, payments for the 1 million traditional Medicare patients hospitalized with COVID-19 totaled $23.4 billion, or more than $24,000 per patient, according to lobbying and law firm Brownstein.

The end of the policy also has the potential to increase medical costs for patients hospitalized with COVID-19. If patients must pay higher costs for COVID-19-related services, they may be less inclined to get tested or even seek treatment.

“It means there will be less testing in this country, and likely less treatment because not everyone can afford it,” Jose Figueroa, MD, assistant professor of health policy and management at the Harvard T.H. Chan School of Public Health, told Time Jan. 31. “Will this change the trajectory of the pandemic? It’s something we are going to have to watch.”

As of Feb. 8, the nation’s seven-day COVID-19 case average was 40,404, a 1 percent decrease from the previous week’s average. The rate of decrease has slowed in the last two weeks — the CDC’s last weekly report published Feb. 3 reported a 6.7 percent drop in cases.

The seven-day hospitalization average for Feb. 1-7 was 3,665, a 6.2 percent decrease from the previous week’s average and down from an 8.4 percent drop in cases a week prior.

An unprecedented mental health crisis for adolescent girls

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https://mailchi.mp/89b749fe24b8/the-weekly-gist-february-17-2023?e=d1e747d2d8

Responding to the Centers for Disease Control and Prevention’s (CDC) latest Youth Risk Behavior Survey for 2011-2021, an article in The Atlantic attempts to make sense of the historic levels of anxiety and depression being reported by today’s teens, especially girls and those who identify as lesbian, gay, or bisexual (the survey does not track trans identity). 

The survey, which is the definitive measure of youth behavior and mental health in the country, found nearly 60 percent of teenage girls reported “persistent feelings of sadness or hopelessness”, and that the share contemplating suicide grew by 50 percent since 2011. The article explores several possible drivers, including a pandemic-induced effect that could subside, pervasive exposure to social media, the normalization of discussing mental distress, and the outcome of growing up with ongoing crises like school shootings and climate change. But none of the explanations fully accounts for the alarming crisis, nor do any of them present easily workable solutions.

The Gist: Echoing the drug overdose epidemic, the unfolding crisis in teen mental health is difficult for providers to address because many victims don’t access healthcare services until their conditions deteriorate to the point of requiring hospitalization, often from a suicide attempt or an overdose.

And when teenagers in mental health crisis present to emergency departments, hospitals are often forced to board them for days, as the number of psychiatric treatment facilities for teens has dropped by 30 percent from 2012 to 2020.

These data should be a call for providers to focus more upstream diagnosis and care, by partnering with children, families, schools, and other community organizations.

The shrinking book of “profitable” health system business 

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https://mailchi.mp/89b749fe24b8/the-weekly-gist-february-17-2023?e=d1e747d2d8

This week, a health system CFO referenced the thoughts we shared last week about many hospitals rethinking physician employment models, and looking to pull back on employing more doctors, given current financial challenges. He said, “We’ve employed more and more doctors in the hope that we’re building a group that will allow us to pivot to total cost management.

But we can’t get risk, so we’ve justified the ‘losses’ on physician practices by thinking we’re making it up with the downstream volume the medical group delivers.

But the reality now is that we’re losing money on most of that downstream business. If we just keep adding doctors that refer us services that don’t make a margin, it’s not helping us.” 


While his comment has myriad implications for the physician organization, it also highlights a broader challenge we’ve heard from many health system executives: a smaller and smaller portion of the business is responsible for the overall system margin.

While the services that comprise the still-profitable book vary by organization (NICU, cardiac procedures, some cancer management, complex orthopedics, and neurosurgery are often noted), executives have been surprised how quickly some highly profitable service lines have shifted. One executive shared, “Orthopedics used to be our most profitable service line. But with rising labor costs and most of the commercial surgeries shifting outpatient, we’re losing money on at least half of it.”

These conversations highlight the flaws in the current cross-subsidy based business model. Rising costs, new competitors, and a challenging contracting environment have accelerated the need to find new and sustainable models to deliver care, plan for growth and footprint—and find a way to get paid that aligns with that future vision.

Consumers are skeptical of “hospitals”—just not their own

Posted on by • Posted in Consumer Experience, Consumer Loyalty, Health System, Hospital, Hospital Industry, Mission, Mistrust, Net Income, Operating Margin, Profit, Profit Margin, Profit Motive, Public Opinion, Public Perception, Public Relations • Leave a comment

https://mailchi.mp/89b749fe24b8/the-weekly-gist-february-17-2023?e=d1e747d2d8

Health systems have recently been the subject of high-profile media accusations that they prioritize “profits over patients”, as an unflattering New York Times series has framed it.

New consumer survey data from strategic healthcare communications consulting firm Jarrard Inc. shows that while consumers find some merit in these claims, they tend to see their local hospital in a better light. As shown in the graphic above, a majority of US adults believe that, on a national level, hospitals are more focused on making money than caring for patients, and that they don’t do enough to help low-income people access high quality care.

Despite only one in five survey participants having seen news stories alleging hospitals fail to provide enough charity care in exchange for tax breaks, 65 percent of survey respondents find those allegations believable.

But while the consumer perception of hospitals may be suffering nationally, the responses were quite different when consumers were asked about their preferred local hospital. More than half strongly agreed that their preferred local hospital is a good community partner—one that puts patient care ahead of making money.

(Just as with Congress: people love to criticize the institution, while continuing to return their own representatives to Washington.) While the negative national attention can be disheartening, at the end of the day, to consumers, healthcare is local, and health systems must continue to build direct consumer relationships to strengthen patient loyalty. 

Most board members at the nation’s top hospitals have no healthcare background: Study

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https://www.beckershospitalreview.com/hospital-management-administration/most-board-members-at-the-nations-top-hospitals-have-no-healthcare-background-study.html?utm_medium=email&utm_content=newsletter

Less than 15 percent of board members overseeing the nation’s top hospitals have a professional background in healthcare, while more than half have a background in finance or business services, according to a study published Feb. 8 in the Journal of General Internal Medicine.

The study’s authors represent Harvard Medical School and Brigham and Women’s Hospital in Boston and the University of Alabama at Birmingham. They wrote that they sought to understand which professions are represented most among hospital boards because they may influence the organization’s goals and overall strategy — there also had been little research done around the topic previously.

The study began in July by examining the 20 top-rated hospitals by US News & World Report in 2022, which are all nonprofit academic medical centers in urban areas. 

Only 15 of the 20 facilities publish board information online, and IRS filings for the remaining were incomplete or outdated.

For the 15 hospitals that provide information on their board members, the authors sorted their professional backgrounds across 11 industry sectors using the North American Industry Classification System, which is the federal standard. For board members with healthcare backgrounds, they were further categorized as trained physicians, nurses, or other workers. 

Four key takeaways:

1. At the 15 examined hospitals, there were 567 board members. The study was able to sort 529 into professional categories.

2. Among the 529 board members, 44 percent had a background in finance. Among them, more than 80 percent led private equity funds, wealth management firms, or multinational banks. The remainder were in real estate (14.7 percent) or insurance (5.2 percent).

3. The second and third most common sectors were health services (16.4 percent) and professional and business services (12.6 percent).

4. Across the 15 hospitals, 14.6 percent of board members were healthcare professionals — primarily physicians (13.3 percent) and followed by nurses (0.9 percent).

The study noted that its findings may not represent all hospitals because it only studied the highest-ranked, and some of those hospitals do not publicly report information on their board members. The study also did not examine “the community ties of board members to gauge local accountability of board decisions.”

The authors also noted that they did not examine the racial and gender makeup of boards, which they said merits further review — in 2018, 42 percent of U.S. hospital boards had all-white members and 70 percent of members were male.

4 health systems hit with rating downgrades

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https://www.beckershospitalreview.com/finance/4-healthcare-systems-hit-with-rating-downgrades.html?utm_medium=email&utm_content=newsletter

Here is a summary of recent credit rating downgrades, going back to the last Becker’s roundup on Jan. 17.

Operating concerns and a bleak financial outlook for some resulted in the following changes:

Geisinger Health System (Danville, Pa.): Moody’s Investors Service downgraded Geisinger Health System’s outstanding bonds from “A1” to “A2” Feb. 13 amid expectations of continued cash flow weakness. 

The outlook for the system, which has about $1.3 billion in debt, is stable. 

Marshfield (Wis.) Clinic Health System:  The system suffered a credit downgrade because of recent operating losses and amid expectations of no immediate financial improvement.

The S&P Global move Feb. 7 to downgrade the system to “BBB+” from “A-” follows a similar move from Fitch Jan. 18.

Marshfield signed a memorandum of understanding with Duluth, Minn.-based Essentia Health to discuss a potential merger Oct. 12 that would include 25 hospitals.

Tower Health (West Reading, Pa.): Troubled Tower Health, which is currently undergoing a strategic review and selling off several assets, suffered a rating downgrade on its bonds, S&P Global reported Feb. 6, adding that the outlook is negative.

“The downgrade reflects Tower Health’s significant ongoing operating losses that are expected to continue in fiscal 2023, and a steep decline in unrestricted reserves to a level that we view as highly vulnerable,” said S&P Global Ratings credit analyst Anne Cosgrove.

Fairview Health (Minneapolis): Moody’s Investors Service downgraded the revenue bond ratings of Fairview Health from “A3” to “Baa1.” 

The downgrade reflects Moody’s projection that weak operating performance will be challenging to overcome due to increased labor costs and lower inpatient volume. Inflation and annual transfers to the University of Minnesota in Minneapolis will also hamper margins, Moody’s said.

4 health systems with recent credit rating upgrades

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https://www.beckershospitalreview.com/finance/4-health-systems-with-recent-credit-rating-upgrades.html?utm_medium=email&utm_content=newsletter

Here are four health systems that recently had their credit rating upgraded by Fitch Ratings, Moody’s Investors Service or S&P Global Ratings:

1. Cooper University Health Care received upgrades from both S&P and Moody’s. S&P upgraded the Camden, N.J.-based system from “BBB+” to “A-,” praising Cooper for its focus on cost containment, revenue improvement, expanding market share and developing key services to gain more tertiary referrals and limit outpatient migration to Philadelphia academic medical centers. 

Moody’s raised the system’s bond ratings from “Baa1” to “A3” and said it expects Cooper’s operating margins will be maintained through execution of its performance improvement plan and strong growth in key service lines. 

2. Loma Linda (Calif.) University Medical Center’s rating was raised to “BB+” from “BB” by Fitch. “The upgrade … incorporates LLUMC’s major new hospital, which is now open, and the system has been operating in their new environment for more than one year, removing a considerable risk factor,” Fitch said in a report. 

3. Mercy Health’s credit rating was upgraded from “A-” to “A” by Fitch. The rating agency said the Rockford, Ill.-based system’s operating profile is expected to remain strong in the longer term. 

4. Orlando (Fla.) Health’s rating was upgraded to “AA-” from “A+” by Fitch. The ratings agency said in a report the bump “reflects the continued strength of OHI’s operating performance, growth in unrestricted liquidity and excellent market position in a demographically favorable market.”

CHS’ net income drops 51% in 2022

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Franklin, Tenn.-based Community Health Systems, one of the largest for-profit health systems in the country, reported $179 million net income in 2022, a 51.4 percent drop from the $368 million net income reported the prior year. 

The drop was driven by a decline in net operating revenues, fewer inpatient admissions and what CHS termed “unfavorable changes” in payer mix.

Total operating costs and expenses for the year ended Dec. 31 were $11.4 billion, up from $11 billion in 2021. Net operating revenues were $12.2 billion in 2022, down slightly from $12.4 billion the prior year. 

Net income in the final three months of the year totaled $446 million compared with $223 million in the same period in 2021.

“We were pleased with our progress during the final quarter of the year, including solid volume growth in admissions, adjusted admissions and surgeries,” CEO Tim Hingtgen said in a statement. “We also significantly reduced contract labor from its peak in early 2022 while improving overall employee recruitment and retention levels.”

CHS, which owns or leases 79 affiliated hospitals with approximately 13,000 beds and operates more than 1,000 sites of care, also released guidance for 2023, predicting annual revenues of between $12.2 billion and $12.6 billion. Such figures compare with $12.2 billion in 2022.

The system, which is also predicting a net loss in 2023 between 0.05 and 0.65 a share, recorded long-term debt of $11.6 billion as of Dec. 31 compared with $12.1 billion at the same time in 2021.

SOTU: Biden’s biggest healthcare priorities

Posted on by • Posted in Abortion, ACA, Cancer, Cancer Moonshot Initiative, Coronavirus, Health Equity, Health Inequity, Health Insurance Coverage Adequacy, Health Policy, Health System, Hospital, Hospital Industry, Inflation Reduction Act, Insulin, Job Growth, Job Market, Medicaid, Medicaid Cliff, Opioid Epidemic, Payor Mix, Public Health Emergency (PHE), Unemployment • Leave a comment
https://www.advisory.com/daily-briefing/2023/02/08/sotu?utm_source=member_db&utm_medium=email&utm_campaign=2023feb08&utm_content=member_headline_final_ectake_x_x_x&elq_cid=4838956&

President Joe Biden last night highlighted several healthcare priorities during his State of the Union address, including efforts to reduce drug costs, a universal cap on insulin prices, healthcare coverage, and more.

COVID-19

In his speech, Biden acknowledged the progress the country has made with COVID-19 over the last few years.

“Two years ago, COVID had shut down our businesses, closed our schools, and robbed us of so much,” he said. “Today, COVID no longer controls our lives.”

Although Biden noted that the COVID-19 public health emergency (PHE) will come to an end soon, he said the country should remain vigilant and called for more funds from Congress to “monitor dozens of variants and support new vaccines and treatments.”

The Inflation Reduction Act

Biden highlighted several provisions of the Inflation Reduction Act (IRA), which passed last year, that aim to reduce healthcare costs for millions of Americans.

“You know, we pay more for prescription drugs than any major country on earth,” he said. “Big Pharma has been unfairly charging people hundreds of dollars — and making record profits.”

Under the IRA, Medicare is now allowed to negotiate the prices of certain prescription drugs, and out-of-pocket drug costs for Medicare beneficiaries are capped at $2,000 per year. Insulin costs for Medicare beneficiaries are also capped at $35 a month.

“Bringing down prescription drug costs doesn’t just save seniors money,” Biden said.  “It will cut the federal deficit, saving tax payers hundreds of billions of dollars on the prescription drugs the government buys for Medicare.”

Caps on insulin costs for all Americans

Although the IRA limits costs for seniors on Medicare, Biden called for the policy to be made universal for all Americans. According to a 2022 study, over 1.3 million Americans skip, delay purchasing, or ration their insulin supply due to costs.

“[T]here are millions of other Americans who are not on Medicare, including 200,000 young people with Type I diabetes who need insulin to save their lives,” Biden said. “… Let’s cap the cost of insulin at $35 a month for every American who needs it.”

With the end of the COVID-19 PHE, HHS estimates that around 15 million people will lose health benefits as states begin the process to redetermine eligibility.

The opioid crisis

Biden also addressed the ongoing opioid crisis in the United States and noted the impact of fentanyl, in particular.

“Fentanyl is killing more than 70,000 Americans a year,” he said. “Let’s launch a major surge to stop fentanyl production, sale, and trafficking, with more drug detection machines to inspect cargo and stop pills and powder at the border.”

He also highlighted efforts by to expand access to effective opioid treatments. According to a White House fact sheet, some initiatives include expanding access to naloxone and other harm reduction interventions at public health departments, removing barriers to prescribing treatments for opioid addiction, and allowing buprenorphine and methadone to be prescribed through telehealth.

Access to abortion

In his speech, Biden called on Congress to “restore” abortion rights after the U.S. Supreme Court overturned Roe v. Wade last year.

“The Vice President and I are doing everything we can to protect access to reproductive healthcare and safeguard patient privacy. But already, more than a dozen states are enforcing extreme abortion bans,” Biden said.

He also added that he will veto a national abortion ban if it happens to pass through Congress.

Progress on cancer

Biden also highlighted the Cancer Moonshot, an initiative launched last year aimed at advancing cancer treatment and prevention.

“Our goal is to cut the cancer death rate by at least 50% over the next 25 years,” Biden said. “Turn more cancers from death sentences into treatable diseases. And provide more support for patients and families.”

According to a White House fact sheet, the Cancer Moonshot has created almost 30 new federal programs, policies, and resources to help increase screening rates, reduce preventable cancers, support patients and caregivers and more.

“For the lives we can save and for the lives we have lost, let this be a truly American moment that rallies the country and the world together and proves that we can do big things,” Biden said. “… Let’s end cancer as we know it and cure some cancers once and for all.”

Healthcare coverage

Biden commended the fact that “more American have health insurance now than ever in history,” noting that 16 million people signed up for plans in the Affordable Care Act marketplace this past enrollment period.

In addition, Biden noted that a law he signed last year helped millions of Americans save $800 a year on their health insurance premiums. Currently, this benefit will only run through 2025, but Biden said that we should “make those savings permanent, and expand coverage to those left off Medicaid.”

Advisory Board’s take

Our questions about the Medicaid cliff

President Biden extolled economic optimism in the State of the Union address, touting the lowest unemployment rate in five decades. With job creation on the rise following the incredible job losses at the beginning of the COVID-19 pandemic, there is still a question of whether the economy will continue to work for those who face losing Medicaid coverage at some point in the next year.

The public health emergency (PHE) is scheduled to end on May 11. During the PHE, millions of Americans were forced into Medicaid enrollment because of job losses. Federal legislation prevented those new enrollees from losing medical insurance. As a result, the percentage of uninsured Americans remained around 8%. The safety net worked.

Starting April 1, state Medicaid plans will begin to end coverage for those who are no longer eligible. We call that the Medicaid Cliff, although operationally, it will look more like a landslide. Currently, state Medicaid regulators and health plans are still trying to figure out exactly how to manage the administrative burden of processing millions of financial eligibility records. The likely outcome is that Medicaid rolls will decrease exponentially over the course of six months to a year as eligibility is redetermined on a rolling basis.

In the marketplace, there is a false presumption that all 15 million Medicaid members will seamlessly transition to commercial or exchange health plans. However, families with a single head of household, women with children under the age of six, and families in both very rural and impoverished urban areas will be less likely to have access to commercial insurance or be able to afford federal exchange plans. Low unemployment and higher wages could put these families in the position of making too much to qualify for Medicaid, but still not making enough to afford the health plans offered by their employers (if their employer offers health insurance). Even with the expansion of Medicaid and exchange subsidies, it, is possible that the rate of uninsured families could rise.

For providers, this means the payer mix in their market will likely not return to the pre-pandemic levels. For managed care organizations with state Medicaid contracts, a loss of members means a loss of revenue. A loss of Medicaid revenue could have a negative impact on programs built to address health equity and social determinants of health (SDOH), which will ultimately impact public health indicators.

For those of us who have worked in the public health and Medicaid space, the pandemic exposed the cracks in the healthcare ecosystem to a broader audience. Discussions regarding how to address SDOH, health equity, and behavioral health gaps are now critical, commonplace components of strategic business planning for all stakeholders across our industry’s infrastructure.

But what happens when Medicaid enrollment drops, and revenues decrease? Will these discussions creep back to the “nice to have” back burners of strategic plans?

Or will we, as an industry, finish the job?