Over the past week, as coronavirus cases have spiked and COVID hospitalizations have grown to alarming levels, we’ve been keeping a close pulse on the situation at our member health systems in markets across the country.
Here’s what we can report: admissions are rising on a curve that looks increasingly vertical.
The ICU is less of a problem than inpatient beds, and while no one wants to cancel non-emergent procedures again, having just worked through the backlog of cases that were postponed in late spring and early summer, discussions about reallocating capacity are starting again. Some are considering shifting more surgeries to ambulatory centers, others are planning to dedicate more space to COVID-positive cases in an attempt to segregate the “hot zone”, and still others are exploring home-based care for certain medical admissions. Fortunately, the supply of PPE feels sufficient for the time being, as does testing capacity.
The number one concern among everyone we’ve talked to: staffing. Because of the high level of community spread, many are now losing nurses and other key staff to COVID isolation, with one system reporting that 35 percent of its critical care nurses at a key hospital had tested positive or were in quarantine after exposure. Staff are burned out, exhausted from the past eight months, and turnover rates are spiking. Because the third wave is so widespread, it’s become harder to find nurses from other markets who can temporarily relocate to help with a surge of cases. And the rates being charged for “agency” nurses—stopgap staff hired on a temporary basis—are going through the roof.
The staffing issue may prove to be the biggest crisis of the third wave of COVID, given how difficult it is to solve; there’s no Defense Production Act or National Guard supply chain for nurses. At best, hospitals will find themselves cobbling together a solution by cross-training staff, paying extra for temporary workers, and asking their already-overtaxed workforce to weather yet another storm. We’re eager to hear any creative approaches to solving the staffing challenge as winter approaches, and we’ve dedicated a senior member of our team to tracking the workforce crisis. Let us know what you’re seeing.
The healthcare sector shed hundreds of thousands of jobs this spring as many providers reduced staffing during the height of the pandemic. Across the summer, healthcare has a seen a wave of rehiring, as doctors’ offices and outpatient surgery and testing centers reopened. But despite the ongoing recession and high unemployment rates, competition for talent remains fierce. In particular, hiring into lower-level clinical support roles is more difficult than before the pandemic, as potential applicants weigh the risk of being exposed to COVID.
In the past, applicants for non-degree positions were attracted by good benefits and a clear career path, but “someone looking to make $15 per hour as an entry-level phlebotomist or patient care associate is now choosing the Amazon warehouse or delivering for DoorDash,” one health executive told us recently. “They’re worried about COVID, and they see the hospital as a place where they’re more likely to get it, even though that’s probably not the case.”
A second health system leader mentioned they have posted hundreds of new job openings in the past two months. According to the COO, “these may be the most important hires we’ve made in decades.” Ensuring this new class of recruits feels safe and supported in the pandemic, and is entering a culture of pride and respect, will lay the foundation for the “post-COVID generation” of the healthcare workforce.
More plans are expected to cover virtual office visits and expanded mental health and well-being offerings.
- Large employers are projecting their health care benefit costs to surpass $15,500 per employee in 2021, Business Group on Health’s annual survey finds.
- That would represent a 5.3% increase in costs, estimated at $14,769 this year.
- The health plans are also expected to expand virtual care, mental health and emotional well-being offerings to employees.
The 5.3% increase is slightly higher than the 5% increases employers projected in each of the last five years, according to the 2021 Large Employers’ Health Care Strategy and Plan Design Survey.
In line with recent years, employers will cover nearly 70% of costs while employees will bear about 30%, or nearly $4,500, in 2021.
“Health care costs are a moving target and one that employers continue to keep a close eye on,” said Ellen Kelsay, president and CEO of Business Group on Health. “The pandemic has triggered delays in both preventive and elective care, which could mean the projected trend for this year may turn out to be too high. If care returns to normal levels in 2021, the projected trend for next year may prove to be too low. It’s difficult to know where cost increases will land.”
The growth in virtual care is one of the trends identified in the survey. Eight in 10 health plan executives said virtual health will play a significant role in how care is delivered, up from 64% last year and 52% in 2018. More than half (52%) will offer more virtual care options next year.
Nearly all employers will offer telehealth services for minor, acute services while 91% will offer telemental health, and that could grow to 96% by 2023.
Virtual care for musculoskeletal management shows the greatest potential for growth. While 29% will offer musculoskeletal management virtually next year, another 39% are considering adding it by 2023. Employers are also expanding other virtual services including the delivery of health coaching and emotional well-being support. These offerings are expected to increase in the next few years.
“Virtual care is here to stay,” said Kelsay. “The pandemic caused the pace to accelerate at an astronomical rate. And virtual care is now garnering growing interest and receptivity from both employees and providers who increasingly see its benefit.”
Another key trend for employer plans in 2021 is the expansion of access to virtual mental health and emotional well-being services. More than two-thirds (69%) said they provide access to online mental health support resources such as apps, videos, and articles. That number is expected to jump to 88% in 2021.
- More employers are linking health care with workforce strategy: The number of employers who view their health care strategy as an integral part of their workforce strategy increased from 36% in 2019 to 45% this year.
- On-site clinics continue to grow: Nearly three in four respondents (72%) either have a clinic in place or will by 2023. Some employers are expanding services — 34% offer primary care services at the worksite, and an additional 26% plan to have this service available by 2023.
- Growing interest in advanced primary care strategies: Over half of respondents (51%) will have at least one advanced primary care strategy next year up from 46% in 2020. These primary care arrangements, which move toward patient-centered population health management emphasizing prevention, chronic disease management, mental health and whole person care are key focus areas for employers.
- Employers remain concerned about high-cost drug therapies. Two-thirds of respondents (67%) cited the impact of new million-dollar treatments as their top pharmacy benefits management concern.