Although only 17 states are currently reporting data on the racial and ethnic breakdown of vaccine recipients, the early data indicate that there are significant disparities in who is getting vaccinated, with the share of Black and Latino people among vaccinees lower than their share of the total population in those states.
Alarmingly, in our recent conversations with health system executives,those same disparities seem to be present among healthcare workers employed by hospitals and health systems. Anecdotally, across a half-dozen health systems we’ve spoken with in the past week, most report that they’ve had about 70 percent of their workers agree to get the first dose of the COVID-19 vaccine.
However, that number looks significantly different when broken down by race and ethnicity:on average, the uptake rate among White, Asian, and Pacific Islander workers has been closer to 90-95 percent, while among Black and Latino workers, it’s been closer to 30-40 percent. Bear in mind these are employees of health systems—in many cases they’re frontline caregivers—and given their work environments you might expect them to be less hesitant to get the vaccine.
That 30-40 percent uptake rate is very worrisome, in two ways:caregivers outside of hospital settings, especially home care and nursing home workers, likely include a larger number of workers hesitant to get vaccinated. And in the general population, among whom health literacy is presumably much lower than among healthcare workers,it’s precisely those populations who are at highest risk of COVID infection, hospitalization, and death. (A further complication: health systems made it easy for their employees to get the shot. With vaccines for the general population still scarce, at-risk populations will inevitably have the most difficult time getting signed up, even if they want the vaccine.)
If health systems are the canary in the coal mine for vaccine hesitancy rates, we’re in for a tough challenge in getting the most vulnerable populations vaccinated in the months to come.
The Medicare Payment Advisory Commission voted Jan. 14 to recommend a 2 percent raise in Medicare payments for hospitals next year.
The commission said it wants to give the payment boost to both acute-care and long-term care hospitals. The 2 percent payment increase will result in about a $750 million to $2 billion increase in acute-care hospital spending for Medicare and about $50 million for long-term care hospitals.
MedPAC also plans to recommend no change to the payment rate for physicians in 2022 and a 5 percent decrease for home health firms and inpatient rehabilitation centers.
Although MedPAC will recommend the payment boost, Congress is not required to implement the recommendation.
The annual J.P. Morgan Healthcare Conference is one of the best ways to diagnose the financial condition of the healthcare industry. Every January, every key stakeholder — providers, payers, pharmaceutical companies, tech companies, medical device and supply companies as well as bankers, venture capital and private equity firms — comes together in one exam room, even when it is virtual, for their annual check-up. But as we all know, this January is unlike any other as this past year has been unlike any other year.
You would have to go back to the banking crisis of 2008 to find a similar moment from an economic perspective. At the time, we were asking, “Are banks too big to fail?” The concern behind the question was that if they did fail, the economic chaos that would follow would lead to a collapse with the consumer ultimately picking up the tab. The rest is history.
Healthcare is “Too Vital to Fail”
2020 was historic in too many ways to count. But in a year when healthcare providers faced the worst financial crisis in the history of healthcare, the headline is that they are still standing. And what they proved is that in contrast to banks in 2008 that were seen by many as “too big to fail,” healthcare providers in 2020 proved that they were “too vital to fail.”
One of the many unique things about the COVID-19 pandemic is we are simultaneously experiencing a health crisis, where healthcare providers are the front line in the battle, and an economic crisis, felt in a big way in healthcare given the unique role hospitals play as the largest employer in most communities. Hospitals and health systems have done the vast majority of testing, treating, monitoring, counseling, educating and vaccinating all while searching for PPE and ventilators, and conducting clinical trials. And that’s just the beginning of the list.
Stop and think about that for a minute. What would we have done without them? Thinking through that question will give you some appreciation for the critical, challenging and central role that healthcare providers have had to play over the past year.
Simply stated, healthcare providers are the heart of healthcare, both clinically (essentially 100 percent of the care) and financially (over 50 percent of the $4 trillion annual spend on U.S. healthcare). Over the last year they stepped up and they stepped in at the moment where we needed them the most. This was despite the fact that, like most businesses, they were experiencing calamitous losses with no assurances of any assistance.
Healthcare is “Pandemic-Proof”
This was absolutely the worst-case scenario and the biggest test possible for our nation’s healthcare delivery system. Patient volume and therefore revenue dropped by over 50 percent when the panic of the pandemic was at its peak, driving over $60 billion in losses per month across hospitals and healthcare providers. At the same time, they were dramatically increasing their expenses with PPE, ventilators and additional staff. This was not heading in a good direction. While failure may not have been seen as an option, it was clearly a possibility.
The CARES Act clearly provided a temporary lifeline, providing funding for our nation’s hospitals to weather the storm. While there are more challenging times ahead, it is now clear that most are going to make it to the other side. The system of care in our country is often criticized, but when faced with perhaps the most challenging moment in the history of healthcare, our nation’s hospitals and health systems stepped up heroically and performed miraculously. The work of our healthcare providers on the front line and those who supported them was and is one thing that we all should be exceptionally proud of and thankful for.In 2020, they proved that not only is our nation’s healthcare system too vital to fail, but also that it is “pandemic proof.”
Listening to Front Line at the 2021 J.P. Morgan Healthcare Conference
There has never been a more important year to listen to the lessons from healthcare providers. They are and were the front line of our fight against COVID-19. If there was a class given about how to deal with a pandemic at an institutional level, this conference is where those lessons were being taught.
This year at the J.P. Morgan Healthcare Conference, CEOs, and CFOs from many of the most prestigious and most well-respected health systems in the world presented including AdventHealth, Advocate Aurora Health, Ascension, Baylor Scott & White Health, CommonSpirit Health, Henry Ford Health System, Intermountain Healthcare, Jefferson Health, Mass General Brigham, Northwell Health, OhioHealth, Prisma Health, ProMedica Health System, Providence, Spectrum Health and SSM Health.
I’ve been in healthcare for 30 years and this is my fifth year of writing up the summary of the non-profit provider track of the conference for Becker’s Healthcare to help share the wisdom of the crowd of provider organizations that share their stories. Clearly, this year was different and not because the presentations were virtual, but because they were inspirational.
What did we learn? The good news is that they have made many changes that have the potential to move healthcare in a much better direction and to get to a better place much faster. So, this year instead of providing you a nugget from each presentation, I am going to take a shot at summarizing what they collectively have in motion to stay vital after COVID.
10 Moves Healthcare Providers are Making to Stay Vital After-COVID
As a leader in healthcare, you will never have a bigger opportunity to drive change than right now. Smart leaders are framing this as essentially “before-COVID (BC)” and “after-COVID (AC)” and using this moment as their burning platform to drive change. Credit to the team at Providence for the acronym, but every CEO talked about this concept. As the saying goes, “never let a good crisis go to waste.” Well, we’ve certainly had a crisis, so here is a list of what the top health systems are doing to ensure that they don’t waste it and that they stay vital after-COVID:
1. Take Care of Your Team and They’ll Take Care of You: In a crisis, you can either come together as a team or fall apart. Clearly there has been a significant and stunning amount of pressure on healthcare providers. Many are fearing that mental health might be our nation’s next pandemic in the near future because they are seeing it right now with their own team. Perhaps one of their biggest lessons from this crisis has been the need to address the mental, physical and spiritual health of both team members as well as providers. They have put programs in place to help and have also built a tremendous amount of trust with their team by, in many cases, not laying off and/or furloughing employees. While they have made cuts in other areas such as benefits, this collective approach proved incredibly beneficial. And the last point here that relates to thinking differently about their team is that similar to other businesses, many health systems are making remote arrangements permanent for certain administrative roles and moving to a flexible approach regarding their team and their space in the future.
2. Focus on Health Equity, Not Just Health Care: This was perhaps the most notable and encouraging change from presentations in past years at J.P. Morgan. I have been going to the conference for over a decade, and I’ve never heard someone mention this term or outline their efforts on “health equity” — this year, nearly everyone did. In the past, they have outlined many wonderful programs on “social determinants of health,” but this year they have seen the disproportionate impact of COVID on low-income communities bringing the ongoing issue of racial disparities in access to care and outcomes to light. As the bedrock of employment in their community, this provides an opportunity to not just provide health care, but also health equity, taking an active role to help make progress on issues like hunger, homelessness, and housing. Many are making significant investments in a number of these and other areas.
3. Take the Lead in Public Health — the Message is the Medicine:One of the greatest failings of COVID, perhaps the greatest lesson learned, is the need for clear and consistent messaging from a public health perspective. That is a role that healthcare providers can and should play. In the pandemic, it represented the greatest opportunity to save lives as the essence of public health is communication — the message is the medicine. A number of health systems stepped into this opportunity to build trust and to build their brand, which are essentially one in the same. Some organizations have created a new role — a Chief Community Health Officer — which is a good way to capture the work that is in motion relative to social determinants of health as well as health equity. Many understand the opportunity here and will take the lead relative to vaccine distribution as clear messaging to build confidence is clearly needed.
4. Make the Home and Everywhere a Venue of Care:A number of presenters stated that “COVID didn’t change our strategy, it accelerated it.” For the most part, they were referring to virtual visits, which increased dramatically now representing around 10 percent of their visits vs. 1 percent before-COVID. One presenter said, “Digital has been tested and perfected during COVID,” but that is only considering the role we see digital playing in this moment. It is clear some organizations have a very narrow tactical lens while others are looking at the opportunity much more strategically. For many, they are looking at a “care anywhere and everywhere” strategy. From a full “hospital in the home” approach to remote monitoring devices, it is clear that your home will be seen as a venue of care and an access point moving forward. The pandemic of 2020 may have sparked a new era of “post-hospital healthcare” — stay tuned.
5. Bury Your Budget and Pivot to Planning:The budget process has been a source of incredible distrust, dissatisfaction and distraction for every health system for decades. The chaos and uncertainty of the pandemic forced every organization to bury their budget last year. With that said, many of the organizations that presented are now making a permanent shift away from a “budget-based culture” where the focus is on hitting a now irrelevant target set that was set six to nine months ago to a “performance-based culture” where the focus is on making progress every day, week, month and quarter. Given that the traditional annual operating budget process has been the core of how health systems have operated, this shift to a rolling forecast and a more dynamic planning process is likely the single most substantial and permanent change in how hospitals and health systems operate due to COVID. In other words, it is arguably a much bigger headline than what’s happened with virtual visits.
6. Get Your M&A Machine in Motion: It was clear from the presentations that activity around acquisitions is going to return, perhaps significantly. These organizations have strong balance sheets and while the strong have gotten stronger during COVID, the weak have in many cases gotten weaker. Many are going to be opportunistic to acquire hospitals, but at the same time they have concluded that they can’t just be a system of care delivery. They are also focused on acquiring and investing in other types of entities as well as forming more robust partnerships to create new revenue streams. Organizations that already had diversified revenue streams in place came through this pandemic the best. Most hospitals are overly reliant on the ED and surgical volume. Trying to drive that volume in a value-based world, with the end of site of service differentials and the inpatient only list, will be an even bigger challenge in the future as new niche players enter the market. As I wrote in the headline of my summary two years ago, “It’s the platform, stupid.” There are better ways to create a financial path forward that involve leveraging their assets — their platform — in new and creative ways.
7. Hey, You, Get into the Cloud:With apologies for wrapping a Rolling Stones song into a conference summary, one of the main things touted during presentations was “the cloud” and their ability to pull clinical, operational and financial dashboards together to monitor the impact of COVID on their organization and organize their actions. Focus over the last decade has been on the clinical (implementing EHRs), but it is now shifting to “digitizing operations” with a focus on finance and operations (planning, cost accounting, ERPs, etc.) as well as advanced analytics and data science capabilities to automate, gather insight, manage and predict. It is clear that the cloud has moved from a curiosity to a necessity for health systems, making this one of the biggest areas of investment for every health system over the next decade.
8. Make Price Transparency a Key Differentiator: One of the great lessons from Amazon (and others) is that you can make a lot of money when you make something easy to buy. While many health systems are skeptical of the value of the price transparency requirements, those that have a deep understanding of both their true cost of care and margins are using this as an opportunity to prove their value and accelerate their strategy to become consumer-centric. While there is certainly a level of risk, no business has ever been unsuccessful because they made their product easier to understand and access. Because healthcare is so opaque, there is an opening for healthcare providers to build trust, which is their main asset, and volume, which is their main source of revenue, by becoming stunningly easy to do business with. This may be tough sledding for some as this isn’t something healthcare providers are known for. To understand this, spend a few minutes on Tesla’s website vs. Ford’s. The concept of making something easy, or hard, to buy will become crystal clear as fast as a battery-driven car can go from zero to 60.
9. Make Care More Affordable:This represents the biggest challenge for hospitals and health systems as they ultimately need to be on the right side of this issue or the trust that they have will disappear and they will remain very vulnerable to outside players. All are investing in advanced cost accounting systems (time-driven costing, physician costing, supply, and drug costing) to truly understand their cost and use that as a basis to price more strategically in the market. Some are dropping prices for shoppable services and using loss leader strategies to build their brand. The incoming Secretary of Health and Human Services has a strong belief regarding the accountability of health systems to be consumer centric. The health systems that understand this are working to get ahead of this issue as it is likely one of their most significant threats (or opportunities) over the next decade. This means getting all care to the right site of care, evaluating every opportunity to improve, and getting serious about eliminating the need for expensive care through building healthy communities. If you’re worried about Wal-Mart or Amazon, this is your secret weapon to keep them on the sideline.
10. Scale = Survival: One of the big lessons here is that the strong got stronger, the weak got weaker. For the strong, many have been able to “snapback” in financial performance because they were resilient. They were able to designate COVID-only facilities, while keeping others running at a higher capacity. To be clear, while most health systems are going to get to the other side and are positioned better than ever, there are many others that will continue to struggle for years to come. According to our data at Strata, we see 25 percent operating at negative margins right now and another 50 percent just above breakeven. They key to survival moving forward, for those that don’t have a captive market, will be scale. If this pandemic proved one thing relative to the future of health systems it is this — scale equals survival.
When Will We Return to Normal?
Based on what the projections that these health systems shared, the “new normal” for health systems for the first half of 2021 will be roughly 95 percent of prior year inpatient volume with a 20 percent year-over-year drop in ED volume and a drop of 10-15 percent in observation visits. So, the pain will continue, but given the adjustments that were already made in 2020, it looks like they will be able to manage through COVID effectively. While there will be a pickup in the second half of 2021, the safe bet is that a “return to normal” pre-COVID volumes likely won’t occur until 2022. And there are some who believe that some of the volume should have never been there to begin with and we might see a permanent shift downward in ED volume as well as in some other areas.
With that said, I’ll steal a quote from Bert Zimmerli, the CFO of Intermountain Healthcare, who said, “Normal wasn’t ever nearly good enough in healthcare.”In that spirit, the goal should be to not return to normal, but rather to use this moment as an opportunity to take the positive changes driven by COVID — from technology to processes to areas of focus to a sense of responsibility — and make them permanent.
Thanking Our “Healthcare Heroes”
We’ll never see another 2020 again, hopefully. With that said, one of the silver linings of the year is everything we learned in healthcare. The most important lesson was this — in healthcare there are literally heroes everywhere. To each of them, I just want to say “thank you” for being there for us when we needed you the most. We should all be writing love letters to those on the front line who risked their lives to save others. Our nation’s healthcare system has taken a lot of criticism through the years from those on the outside, often with a blind eye to how things work in practice vs. in concept. But this year we all got to see first-hand what’s happening inside of healthcare — the heroic work of our healthcare providers and those who support them.
They faced the worst crisis in the history of healthcare. They responded heroically and were there for our families and friends.
They proved that healthcare is too vital to fail. They proved that healthcare is pandemic-proof.
The first month of the pandemic was also supposed to be the month I got pregnant, but my clinic closed and plans changed. Doctors and nurses needed personal protective equipment to tend to patients with covid-19, not women with recurrent miscarriages.
When the clinic reopened several months later, it turned out my husband and I had only been delaying yet another loss: In late August, he obeyed the medical center’s strict coronavirus protocols by waiting anxiously in the car while I trudged inside, masked and hand-sanitized, to receive a miscarriage diagnosis alone. I searched the ultrasound screen for the rhythmic beat of a heart, and then accepted that whatever had once been there was now gone.
But that was 2020 for you, consistent only in its utter crappiness. For every inspiring video of neighbors applauding a shift change at the hospital, another video of a bone-tired nurse begging viewers to believe covid was real, it wasn’t a hoax, wear a mask.
For every protest organized by activists who understood racism is also a long-term crisis, an appearance by the Proud Boys; for every GoFundMe successfully raising money for a beloved teacher’s hospital bills, a bitter acknowledgment that online panhandling is our country’s version of a safety net.
Millions of citizens stood in line for hours to vote for the next president and then endured weeks of legal petitions arguing that their votes should be negated. The basis for these legal actions were conspiracy theories too wild to be believed, except that millions of other citizens believed them.
And that was 2020 for you, too: accepting the increasingly obvious reality that the country was in peril, built on iffy foundations that now buckled under pressure. My loved ones who worked as waiters or bartenders or physical therapists were choosing between health and paychecks, and even from the lucky safety of my work-from-home job, each day began to feel like watching America itself arrive at a hospital in bad shape, praying that doctors or clergy could find something they were able to save.
Is there a heartbeat?
You want the answer to be yes, but even so, it was hard to imagine how we would come back from this.
What kind of delusional person would even try to get pregnant in this world? In my case it would never be a happy accident; it would always be a herculean effort. And so it seemed I should have some answers.
How do you explain to a future child: Sorry, we can’t fix climate change; we can’t even get people to agree that we should wear masks in grocery stores? How do you explain the frustration of seeing brokenness, and then the wearying choice of trying to fix it instead of abandoning it? How do you say, Love it anyway. You’re inheriting an absolute mess, but love it anyway?
I found myself asking a lot of things like this in 2020, but really they were all variations of the same question: What does it mean to have hope?
But in the middle of this, scientists worked quietly in labs all over the world. They applied the scientific method with extraordinary discipline and speed. A vaccine was developed. Tens of thousands of volunteers rolled up their sleeves and said, Try it out on me.
It was approved, and a nurse from Long Island was the first American televised receiving it. Her name was Sandra Lindsay, an immigrant from Jamaica who had come to the United States 30 years ago and who had spent the last year overseeing critical care teams in back-to-back shifts. She said she had agreed to go first to show communities of color, long abused, brushed-off or condescended to by the medical system, that the vaccine was safe.
Here was hope. And more than that, here was hope from a woman who had more reason than most to be embittered: an exhausted health-care worker who knew too well America’s hideous racial past and present, who nonetheless also knew there was only one way out of the tunnel. Here she was, rolling up her own sleeve, and there were the lines of hospital employees ready to go after her, and there were the truck drivers ferrying shipments of syringes.
I can’t have been the only person to watch the video of those early inoculations, feeling elated and tired, and to then burst into tears. I can’t have been the only person to realize that even as 2020 revealed brokenness, it also contained such astounding undercurrents of good.
The scientific method works whether you accept it or not. Doctors try to save you whether you respected public-health guidelines or not. Voter turnout was astronomical because individual citizens realized they were all, every one of them, necessary pieces in a puzzle, even if they couldn’t see what the final picture was supposed to look like.
The way to believe in America is to believe those things are passed down, too.
Sometime in October, a couple of months after my last miscarriage — when the country was riding up on eight months of lonely and stoic birthdays, graduations, deaths and weddings — I went into the bathroom and saw a faint second line on a First Response pregnancy test. It was far from my first rodeo, so I knew better than to get excited. I mentioned it to my husband with studied nonchalance, I told him that I’d test again in a few days but that we should assume the worst would happen.
Two weeks after that, I had a doctor’s appointment, and then another a week later, each time assuming the worst, but each time scheduling another appointment anyway, until eventually I was further along than I’d ever gotten before — by one day, then three days, then thirty.
I am not a superstitious person. I don’t believe that good things always come to those who deserve them. I believe that stories regularly have sad endings and that it’s often nobody’s fault when they do, and that we should tell more stories with sad endings so that people who experience them know that they’re not alone.
But 2020 has taught me that I am, for better or worse, someone who wants to hope for things. To believe in the people who developed vaccines. In the people who administered them. In Sandra Lindsay. In the people who delivered groceries, who sewed masks, who have long cursed America’s imperfect systems and long fought to change them, who still donate $10 to a sick teacher’s GoFundMe.
At my most recent appointment, the doctor’s office was backed up in a holiday logjam. I sat in the exam room for nearly three hours while my husband again waited anxiously in the car. I texted him sporadic updates and tried to put hope in a process that so far had not seemed to warrant my hope.
It all felt precarious. The current reality always feels precarious.
And yet there we all are together, searching for signs of life, hoping that whatever we emerge to can be better than what we had before, and that whatever we build will become our new legacy. The sonographer finally arrived and turned on the machine.
Travelers boarding a flight during the pandemic might consider it unlikely that anyone sick with the coronavirus would make it onboard. But the reality is that travelers are boarding planes with covid-19, putting their fellow passengers at risk of contracting the illness.
Beyond the danger those infected passengers are creating to the people around them, they also pose a sizable risk to themselves when they board their planes. Doctors say that flying is a high-risk activity for coronavirus-positive individuals because of low air pressure in the cabin and that multiple passengers have now died because of it.
The likely medical problem in both these instances, doctors say, is that low air pressure — which is standard in plane cabins — creates dangerously low blood-oxygen levels in people with respiratory conditions. Covid-19, the illness caused by the coronavirus, is a respiratory disease that often attacks the lungs and heart.
Nicholas Hill, pulmonary chief at Tufts Medical Center in Boston, says there is “no question” that the air condition in plane cabins poses a risk to passengers with covid-19 and that flying was probably factor in the deaths of the passengers infected with the virus.
“If you get on a plane with covid, or anything else respiratory-related, you are going to be at a considerably higher risk when you go to altitude,” Hill says. “This is not something unique to covid; it’s true of anybody that’s got an acute or respiratory condition. This change in oxygen from sea level can provoke crises in the air.”
Plane cabins are pressurized so passengers are able to breathe at altitudes over 30,000 feet, but the air pressure is still about 25 percent lower in a plane cabin than it is at sea level. Flying has long given respiratory-troubled patients medical crises in the air. Covid-19 is no different. Flying with it can impact blood oxygen levels to a degree that requires immediate medical attention.
David Freedman, an epidemiologist at the University of Alabama at Birmingham, says covid-infected patients are at the same risk as people with non-coronavirus lung and heart conditions that impact their breathing. Airlines are prepared for those kinds of respiratory emergencies with supplemental oxygen onboard.
“The oxygen concentration [on planes] is much lower than on the ground, and all patients with severe lung or heart disease know this and know that they will need supplemental oxygen on board even if they don’t require it normally,” Freedman says. “All planes do carry an oxygen tank on board for emergencies like this.”
Delta Air Lines says that respiratory emergencies make up about 10 percent of in-flight medical events and that all aircraft are equipped with supplemental oxygen.
All airline flight attendants receive annual training in CPR, Taylor Garland, a spokesperson for the Association of Flight Attendants labor union, told The Washington Post in an email. Flight crew are also in close contact with medical services on the ground that can meet the aircraft in the event of an emergency landing.
But those efforts all fell short in the July and December deaths. Hill says passengers do not necessarily need to be experiencing shortness of breath before takeoff to become breathing-impaired in-flight. Blood oxygen levels can be low in covid-19 patients who are not experiencing trouble breathing, making getting on a plane with the virus — even if you’re pre-symptomatic or asymptomatic — a high-risk endeavor.
“Early on in the pandemic there were descriptions of ‘happy hypoxia’ patients, covid patients who come in with pretty low oxygen levels but wouldn’t be short of breath,” Hill says. “Most people who have low oxygen levels are also complaining of shortness of breath, but it is possible initially to not have those symptoms.”
On the July Spirit Airlines flight, a crew member who administered CPR to the unresponsive woman passed out from exhaustion, according to reporting by The Post. Contact tracers reportedly never notified passengers on the plane of the positive coronavirus case onboard.
Tony Aldapa, an off-duty medical worker on the Dec. 14 United flight who gave chest compressions to the unresponsive man, said last week that he was experiencing coronavirus symptoms after helping the flight crew with CPR. He was not notified about his exposure to the virus by contact tracers until 10 days after the flight.
“I knew we were pretty far from where we needed to land at, and CPR is exhausting with one person or two people. Even with three or four people, it’s not an easy thing to do,” Aldapa, 31, told the Los Angeles Times of the incident. “Regardless of COVID … he needed CPR to save his life.”
As the coronavirus sickens tens of thousands of Americans while pressuring the bottom lines of medical providers, analysts worry the pandemic could also hit pause on the decades-long march toward value-based care, as hospitals and doctors look to recoup revenue in the short-term instead of putting more dollars at risk.
Massive health systems and independent physician offices alike are diverting funds to shore up resources like personal protective equipment, ventilators and staff to prepare for an expected influx of COVID-19 patients or to cope with those already there. Expenses are skyrocketing as providers halt non-essential visits including lucrative elective procedures like joint replacements, winnowing down a major source of revenue.
Clinicians in value-based payment arrangements face higher levels of financial risk than their fee-for-service counterparts. Money spent preparing for the coronavirus and treating COVID-19 patients will be a sunk cost and they could be dinged financially again at the end of the year when their spending and performance is evaluated.
Already, the coronavirus is leading providers to think about exiting the models.
A survey published this week of more than 220 accountable care organizations nationwide found almost 60% are likely to drop out of their risk-based model to avoid financial losses. Some 77% are “very concerned” about the coronavirus’ impact on their 2020 performance.
“The value-based movement is at a critical juncture,” wrote National Association of ACOs CEO Clif Gaus in a letter to CMS Administrator Seema Verma last month.
Fee-for-service still dominates — roughly 40% of healthcare payments made in 2018 were under fee-for-service, according to the Health Care Payment Learning & Action Network (LAN) — but it’s been on the downswing. One in three healthcare payments currently flows through some sort of alternative payment model, and that has been projected to grow.
Among the four main types of value-based arrangements — shared risk, global capitation, bundled care and shared savings — most require an upfront financial commitment. And providers are unlikely to put more capital at risk given the current economic situation, analysts told Healthcare Dive, instead focusing on making up the losses they sustained during the outbreak by ramping up capacity.
Doctor’s offices and hospitals will reschedule delayed procedures and even operate on weekends to recapture as much revenue as possible before they’re likely to consider taking on more risk.
“Even if you’re not in the hotspots, you are preparing right now. This puts on hold a lot of the initiatives that have been on the value-based side of things,” Jefferies senior healthcare analyst Brian Tanquilut told Healthcare Dive. “I don’t think the value-based discussion goes away, but I think it will take a recovery of the hospital system before it can go there.”
Pleas for loss waivers
The National Association of ACOs told CMS in mid-March that ACOs in Medicare’s flagship ACO program the Shared Savings Program, along with other shared risk models like the Next Generation ACO model and the upcoming Direct Contracting initiative, could face losses beyond their control because of the pandemic.
CMS did pause some reporting requirements for value-based initiatives late last month. The agency pushed back the deadline for groups participating in the Medicare ACO program, Merit-based Incentive Payment System and the Hospital Readmissions Reduction Program to report quality data, or waived reporting entirely for the fourth quarter of 2019. The relaxation was framed as a way to help value-based organizations free up time and resources amid the pandemic.
But provider groups including NAACOS and the American Hospital Association have lobbied aggressively for the Trump administration to forgive all ACO losses for 2020. CMS is reviewing their request.
But all normal rules have gone out the window, experts say, and it’s almost impossible to move the needle toward value in the future when providers are facing a tsunami of patients now.
“This is not about managing a population. This is about doing everything you can to keep these people alive,” Dean Ungar, vice president of Moody’s Investors Service, told Healthcare Dive. “Coronavirus is really a five-alarm fire. But if your building’s on fire, that doesn’t really tell you how to maintain your business in normal circumstances.”
Some, however, are more optimistic that the unique financial challenges brought on by the pandemic highlight the problems with the traditional fee-for-service model and could even nudge providers toward value-based arrangements down the line.
“If all of your revenue is based on patients walking in the door, when they can’t walk in the door anymore, you’re kind of up the creek without a paddle,” Dan Bowles, SVP of growth and network operations at accountable care organization Aledade told Healthcare Dive. “You need to find a way to create non-visit-based revenue.”
Some hope the pandemic could help the value-based movement in the long term as practices look for ways to uncouple revenue from patient volume. And, as medical costs continue to rise, accounting for 19% of the country’s GDP, any pause in the shift to value-based care due to the coronavirus is likely to be a short detour, not a complete derailment.
“Maybe some providers are going to see it in a different light when their business kind of dries up — see that there’s a benefit to it,” Ungar said. “Ultimately, it’s a trend of where things are going, but it’s a big ship and it’s moving slowly.”
And value-based care arrangements were built predominantly for the populations being hit hardest by the coronavirus: those with serious underlying medical conditions like chronic lung disease or severe obesity.
If those vulnerable patients were being treated in value-based arrangements, it’s possible more COVID-19 cases could have been caught earlier before they became life-threatening, Moody’s analyst Stefan Kahandaliyanage told Healthcare Dive. That could renew industry’s focus on managing the health of those most at-risk from novel infectious diseases in the future.
“Costs are very high and there’s been a pandemic,” Kahandaliyanage said. “Let’s get more healthy before the next pandemic comes.”
It turns out it’s not just the kids who aren’t getting snow days this year. This week, we spoke with an executive at a health system hit hard by Wednesday’s Nor’easter, and asked how the system was faring with the expected 18 inches of snowfall. He replied that the medical group was as busy as usual.
With all the work this spring to expand telemedicine capabilities, clinic staff were able to reach out to patients the day before the storm, and proactively convert a majority of scheduled in-person clinic visits to telemedicine. “Normally we would’ve been closed, and most appointments rescheduled for weeks down the road,” he told us. Instead, they were able to keep most of those visits in their scheduled time slot.
“Now that we have a systemwide process for telemedicine, I don’t think we’ll have a reason for the clinic to take a snow day again.” It’s a clear win-win for the system and patients: patient care seamlessly goes on. It’s easy to see the many use cases for the ability to toggle between in-person and virtual visits. A parent is stuck at home with a sick kid, and can’t make her endocrinologist appointment? Moved to virtual! A patient has an unexpected business trip taking him out of town? Don’t cancel, let’s do that follow-up visit via telemedicine.
We’ve been worried about the slowdown in progress made on telemedicine as patients switched back to in-person visits across the summer and fall. The ability to continue patient care during a record-breaking snowstorm is a perfect illustration of why it’s critical not to “backslide” with virtual care: meeting patients where they are, regardless of circumstances, is an essential part of building long-term loyalty and care continuity.
An Oregon physician who publicly spoke out against wearing a mask to slow the spread of COVID-19 has had his medical license suspended, according to The Washington Post.
In a written order Dec. 4, the Oregon Medical Board suspended the license of Steven A. LaTulippe, MD, a family medicine physician at South View Medical Arts in Dallas, Ore. The board alleges Dr. LaTulippe engaged in “conduct that is contrary to medical ethics and does or might constitute a danger to the health or safety of the public.”
It also accuses him of “gross negligence.”
Specific acts cited in the letter include the physician’s alleged advice to a Medicaid patient. According to the board, the patient contacted Dr. LaTulippe’s medical clinic in July for guidance on COVID-19 and was told asymptomatic people should not be tested, that wearing masks does not prevent virus transmission, and the patient was told not to self-isolate because exposure to others would provide COVID-19 immunity.
The board said the patient seeking the guidance from Dr. LaTulippe’s clinic was terminated as a patient after questioning the appropriateness of the guidance.
The board also contends workers in Dr. LaTulippe’s clinic refuse to wear masks at work and urge people who enter the clinic wearing masks to remove them.
Dr. LaTulippe “regularly tells his patients that masks are ineffective in preventing the spread of COVID-19 and should not be worn”; “directs patients to a YouTube video providing false information about mask-wearing” ; and “regularly advises, particularly for his elderly and pediatric patients, that it is ‘very dangerous’ to wear masks because masks exacerbate [chronic obstructive pulmonary disease] and asthma and cause or contribute to multiple serious health conditions,” according to the board.
The Post could not immediately reach Dr. LaTulippe for comment Dec. 5.
In a recent interview, Dr. LaTulippe told NBC News he believes there is “bad science behind” wearing masks.
“I have absolutely zero problems with infectivity, and I have completely successful treatments, so I ask, ‘What is the problem?’ Why would I be demonized if I know what I’m doing?” he told the news network.
The CDC has advocated wearing masks to combat COVID-19.