With the impending summer dip in donors, blood centers across the U.S. face a tall hurdle during a national blood shortage.
Six months ago, the organization that supplies nearly half of the nation’s blood supply, Red Cross, declared the first-ever national crisis. Summer has always slowed donors, a trend often attributed to closed schools and people busy on vacations, but with COVID-19 already hurting blood donation numbers, blood banks face an unsteady season.
“It’s a very challenging time, and it does put a lot of stress on the organization because we take saving lives very seriously,” the executive director of the Arkansas Blood Institute, Mario Sedlock, told radio station KUAR. “We just want to make sure that our hospitals have what they need to take care of the patients and that’s essentially what we’re all about.”
An Ohio blood center issued an emergency plea in mid-June for O-negative donors because of a “dangerously low” supply, and some blood centers are offering free movie tickets and baseball tickets to entice donors.
Blood centers in some U.S. cities are down to a one-day supply, forcing hospitals to postpone surgeries. The blood shortage is yet another fallout from the pandemic, experts say.
OneBlood, the Southeast’s largest blood center, is scrambling to manage the blood shortage crisis.
“It’s a 24/7 operation,” said OneBlood’s Susan Forbes. “The donors are not in the traditional locations anymore. We lost large corporations, religious organizations, movie theater drives, festivals that were taking place ended.”
Before COVID-19 shutdowns, schools accounted for 25% of collected blood. Now, demand for blood products is up 10% nationwide.
Some hospitals have had to delay scheduled surgeries. At NYU Langone Health in New York City, surgeon-in-chief Dr. Paresh Shah said they came close to doing the same.
“There’s this huge backlog of operations that really needed to get done,” Shah said. “We were down to such a low inventory of blood that if we had one major transfusion event, we would have been depleted completely.”
He said the lack of blood can mean life or death in trauma situations.
Eleven-year-old Iggy Friday was diagnosed with Leukemia this winter and has needed more than 30 transfusions during chemotherapy. His recent platelet transfusion was delayed because of the shortage — luckily for just a few hours.
“I did think about the people who needed it now and stuff. So that’s why I was fine with waiting,” he said. “It helps a lot of people and can save a lot of lives.”
A Virginia OB-GYN was sentenced May 18 to 59 years in prison for a fraud scheme that caused insurance programs to lose more than $20 million, according to the U.S. Justice Department.
Javaid Perwaiz, MD, was sentenced after being convicted last November of 52 counts of healthcare fraud and false statements related to a scheme in which he performed medically unnecessary surgeries, including hysterectomies and improper sterilizations, on his patients.
From about 2010 to 2019, Dr. Perwaiz often falsely told his patients that they needed the surgeries because they had cancer or could avoid cancer, prosecutors said. Additionally, evidence showed Dr. Perwaiz falsified records for his obstetric patients to induce labor early to ensure he was reimbursed for the deliveries and violated Medicaid’s required 30-day waiting period for elective sterilization procedures by backdating records to make it appear that he had complied with the waiting period. Dr. Perwaiz also billed insurance companies for diagnostic procedures that he only pretended to perform at his office, prosecutors said.
“Motivated by his insatiable and reprehensible greed, Perwaiz used an arsenal of horrifying tactics to manipulate and deceive patients into undergoing invasive, unnecessary and devastating medical procedures,” Raj Parekh, acting U.S. attorney in the Eastern District of Virginia, stated. “In many instances, the defendant shattered their ability to have children by using fear to remove organs from their bodies that he had no right to take.”
A lawyer representing Dr. Perwaiz told The New York Times that Dr. Perwaiz is appealing the conviction.
For-profit hospitals are expected to see a financial decline over the next 12 to 18 months as federal relief funds that shored up revenue losses due to COVID-19 start to wane, a recent analysis from Moody’s said.
The analysis, released Monday, finds that cost management is going to be challenging for hospital systems as more surgical procedures are expected to migrate away from the hospital and people lose higher-paying commercial plans and go to lower-paying government programs such as Medicaid.
“The number of surgical procedures done outside of the hospital setting will continue to increase, which will weaken hospital earnings, particularly for companies that lack sizeable outpatient service lines (including ambulatory surgery centers),” the analysis said.
A $175 billion provider relief fund passed by Congress as part of the CARES Act helped keep hospital systems afloat in March and April as volumes plummeted due to the cancellation of elective procedures and reticence among patients to go to the hospitals.
Some for-profit systems such as HCA and Tenet pointed to relief funding to help generate profits in the second quarter of the year. The benefits are likely to dwindle as Congress has stalled over talks on replenishing the fund.
“Hospitals will continue to recognize grant aid as earnings in Q3 2020, but this tailwind will significantly moderate after that,” Moody’s said.
Cost cutting challenges
Compounding problems for hospitals is how to handle major costs.
Some hospital systems cut some costs such as staff thanks to furloughs and other measures.
“Some hospitals have said that for every lost dollar of revenue, they were able to cut about 50 cents in costs,” the analysis said. “However, we believe that these levels of cost cuts are not sustainable.”
Hospitals can’t cut costs indefinitely, but the costs for handling the pandemic (more money for personal protective equipment and safety measures) are going to continue for some time, Moody’s added.
“As a result, hospitals will operate less efficiently in the wake of the pandemic, although their early experiences in treating COVID-19 patients will enable them to provide care more efficiently than in the early days of the pandemic,” the analysis found. “This will help hospitals free up bed capacity more rapidly and avoid the need for widespread shutdowns of elective surgeries.”
But will that capacity be put to use?
The number of surgical procedures done outside of the hospital is likely to increase and will further weaken earnings, Moody’s said.
“Outpatient procedures typically result in lower costs for both consumers and payers and will likely be preferred by more patients who are reluctant to check-in to a hospital due to COVID-19,” the analysis said.
The payer mix will also shift, and not in hospitals’ favor. Mounting job losses due to the pandemic will force more patients with commercial plans toward programs such as Medicaid.
“This will hinder hospitals’ earnings growth over the next 12-18 months,” Moody’s said. “Employer-provided health insurance pays significantly higher reimbursement rates than government-based programs.”
There are some bright spots for hospitals, including that not all of the $175 billion has been dispersed yet. The CARES Act continues to provide hospitals with a 20% add-on payment for treating Medicare patients that have COVID-19, and it suspends a 2% payment cut for Medicare payments that was installed as part of sequestration.
The Centers for Medicare & Medicaid Services also proposed increasing outpatient payment rates for the 2021 fiscal year by 2.6% and in-patient rates by 2.9%. The fiscal year is set to start next month.
Patient volumes could also return to normal in 2021. Moody’s expects that patient volumes will return to about 90% of pre-pandemic levels on average in the fourth quarter of the year.
“The remaining 10% is likely to come back more slowly in 2021, but faster if a vaccine becomes widely available,” the analysis found.
The majority of hospitals are electively performing high-risk surgical procedures without sufficient ongoing experience to safely do so, according to a new report.
The report from The Leapfrog Group, an independent hospital safety watchdog group, looked specifically at surgical volumes. The report, which relied on final hospital data from the 2019 Leapfrog Hospital Survey that had responses from more than 2,100 hospitals, also looked at the minimum standards those hospitals require surgeons to meet in order to gain privileges.
They were looking specifically at the safety of eight high-risk procedures identified by an expert panel as having a “strong volume-outcome relationship.” The report also looks at whether hospitals are working to make sure every surgery is necessary.
According to the report, an increasing number of hospitals are meeting minimum volume standards if they perform high-risk hospitals. The majority of rural hospitals opt out of performing the high-risk surgeries because they can’t meet the volume standards. Further, more hospitals are implementing protocols to monitor for appropriateness of surgeries.
“The good news is we are seeing progress on surgical safety. The bad news is the vast majority of hospitals performing these high-risk procedures are not meeting clear volume standards for safety,” said Leah Binder, president and CEO of The Leapfrog Group, in a statement. “This is very disturbing, as a mountain of studies show us that patient risk of complications or death is dramatically higher in low-volume operating rooms.”
For instance, the report suggested hospitals should be performing a minimum of 20 esophageal resections for cancer and a minimum of 20 pancreatic resections for cancer to improve the odds of a safer surgery for their patients. Surgeons should perform at least seven and 10 of those procedures a year, respectively, to gain privileges.
But for those two procedures, only 3% and 8% of hospitals met the volume standards for patient safety, the report found.
Hospitals were most likely to meet the safety standard of a minimum of 50 procedures a year for the hospital and 20 procedures a year for bariatric surgery for weight loss. More than 48% reported meeting that standard in 2019, up from 38% in 2018.
The survey found more than 70% of reporting hospitals have protocols to ensure appropriateness for cancer procedures.
But for other high-risk procedures evaluated such as open-heart surgeries or mitral valve repair and replacement, hospital compliance with ensuring appropriateness dropped to a range of 32% to 60%, depending on the procedure.