Nearly 4 million Americans have been unemployed for 27 weeks or longer — trapped in a vicious cycle that makes it harder to get back to work.
The big picture: Long-term unemployment during a pandemic is a double whammy. Millions are experiencing food and housing insecurity and lack health care when they need it most.
What’s happening: “The troubling amount of long-term unemployment and its continuing rise is dangerous for the U.S. labor market,” says Nick Bunker, an economist at the jobs site Indeed. “A fast labor market recovery will help alleviate these concerns, but that bounce back is still a ways away and dependent on controlling the coronavirus.”
The number of Americans experiencing long-term unemployment — around 4 million — is far from the worst of the Great Recession, when long-term unemployment reached 7 million.
But it’s remarkable considering where the U.S. was before the pandemic. The long-term unemployment rate is 2.5%, which is comparable to the 3.5% overall unemployment rate in January 2020, Bunker notes.
Why it matters:Studies have shown that long-term unemployment hurts workers’ physical and mental health, reports Bloomberg. And the longer someone is unemployed, the harder it is for that person to get another job — let alone another job at the same pay level.
Job-seeking is even more exhausting during a pandemic, says Tim Classen, an economist at the Quinlan School of Business at Loyola University in Chicago.
To start, there are fewer jobs out there than there are unemployed people.
On top of that, people may be attempting to juggle job-hunting with parenting kids who are learning remotely.
Not everyone is comfortable interviewing over video calls, and not everyone has the broadband access required to even attend those interviews.
“The fluctuations in uncertainty play into this, too,” Classen says. Millions of restaurant workers, flight attendants, retail workers and more aren’t sure when the pandemic will end — or if their employers will even survive it.
There’s a bit of a silver lining, though.
While losing a job is a traumatic event and can really chip away at someone’s sense of self-worth, it can also be easier to bear if millions are going through the same thing. Job loss doesn’t feel as personal in a pandemic, says Classen.
“There’s a sense of, ‘Yeah, I’m depressed, and I’ve lost my job, but I’m not alone in my suffering,'” he says. “Maybe in some way that tempers it.”
With nearly 30% of workers now having a high deductible health plan and a typical family being responsible for on average the first $8,000 of costs, consumers are increasingly weighing care versus cost. Historically, with a small copay, you would conveniently take care of an ailment without shopping around, but with the average person now bearing the brunt of the initial costs, wouldn’t you want to know how much a service costs and what other providers are charging before you “buy” the service?
CMS believes“consumers should be able to know, long before they open a medical bill, roughly how much a hospital will charge for items and services it provides.” Cue the hospital price transparency rule that just went into effect January 1, 2021. Hospitals are now required to post their standard charges, including the rates they negotiate with insurers, and the discounted price a hospital is willing to accept directly from a patient if paid in cash. As a consumer, the intent is to make it “easier to shop and compare prices across hospitals and estimate the cost of care before going to the hospital.”
There are a few different angles to analyze here:
Are hospitals following the rules?
Each hospital must post online a comprehensive machine readable file with all items and services, including gross charges, actual negotiated prices with insurers, and the cash price for patients who are uninsured. Additionally, hospitals must post the costs for 300 common “shoppable” services in a “consumer-friendly format.” Some hospitals and health systems have done a good job at posting these prices in a digestible format, like the Cleveland Clinic or Sutter Health, but others have posted complicated spreadsheets, relied on online cost estimator tools, or simply not posted them at all. An analysis from consulting firm ADVI of the top 20 largest hospitals in the U.S. found that not all of them appeared to completely comply with this mandate. In some instances, data was not able to be downloaded in a useable format, others did not post the DRG or service codes, and the variability in the terms/categories used simply created difficulty in comparing pricing information across hospitals. CMS has stated that a failure to comply with the rules could result in a fine of up to $300 per day. As with most new rules, there are growing pains, and hospitals will likely get better at this over time, assuming the data is being used for its original intent.
Is this helpful to consumers?
Consumers will able to see the variation in prices for the exact same service or procedure between hospitals and get an estimate of what they will be charged before getting the care. But how likely is the average person to go to their hospital’s website, look at a price, and change their decision about where to get care? In addition, awareness of these price transparency tools is still low among consumers. Frankly, it is competitors and insurers that have been first in line to review the data. Looking through a number of hospital websites, and even certain state agency sites that have done a good job at summarizing the costs, like Florida Health Price Finder, the price transparency tools are helpful, but appear to be much more suited for relatively standardized services that can be scheduled in advance, like a knee replacement. It’s highly unlikely you will be telling your ambulance driver what hospital to go to based on cost while in cardiac arrest…Plus, it’s all still confusing – even physicians have shared their bewilderment, when trying to decipher and compare pricing. Conceptually, price transparency should be beneficial to consumers, but it will take time; and it will need to involve not just the hospitals posting rates, but the outpatient care facilities as well. Knowing what you will pay before you decide to go to a physician’s office or a clinic or an urgent care or an ED will hopefully help drive consumers to make more educated decisions in the future.
Will this ultimately drive down costs?
I sure hope so. Revealing actual negotiated prices between hospitals and insurers should push the more expensive hospitals in the area to reduce prices, especially if consumers start using the other hospitals, instead. However, it could also have an inverse effect, with lower cost hospitals insisting on a payment increase from insurers; thereby driving up costs. In the end, as has historically been the case, the market power of certain providers will likely dictate the direction of costs in a given region. That is, until both price AND quality become fully transparent and the consumer is armed with the tools to shop for the best care at the lowest cost – consumerism here we come.
In recent weeks, U.S. coronavirus case data — long a closely-watched barometer of the pandemic’s severity — has sent some encouraging signals: The rate of newly recorded infections is plummeting from coast to coast and the worst surge yet is finally relenting. But scientists are split on why, exactly, it is happening.
Some point to the quickening pace of coronavirus vaccine administration, some say it’s because of the natural seasonal ebb of respiratory viruses and others chalk it up to social distancing measures.
And every explanation is appended with two significant caveats: The country is still in a bad place, continuing to notch more than 90,000 new cases every day, and recent progress could still be imperiled, either by new fast-spreading virus variants or by relaxed social distancing measures.
The rolling daily average of new infections in the United States hit its all-time high of 248,200 on Jan. 12, according to data gathered and analyzed by The Washington Post. Since then, the number has dropped every day, hitting 91,000 on Sunday, its lowest level since November.
A former director of the Centers for Disease Control and Prevention endorsed the idea that Americans are now seeing the effect of their good behavior — not of increased vaccinations.
“I don’t think the vaccine is having much of an impact at all on case rates,” Tom Frieden said in an interview Sunday on CNN’s “Fareed Zakaria GPS.” “It’s what we’re doing right: staying apart, wearing masks, not traveling, not mixing with others indoors.”
However, Frieden noted, the country’s numbers are still higher than they were during the spring and summer virus waves and “we’re nowhere near out of the woods.”
“We’ve had three surges,” Frieden said. “Whether or not we have a fourth surge is up to us, and the stakes couldn’t be higher.”
The current CDC director, Rochelle Walensky, said in a round of TV interviews Sunday morning that behavior will be crucial to averting yet another spike in infections and that it is far too soon for states to be rescinding mask mandates. Walensky also noted the declining numbers but said cases are still “more than two-and-a-half-fold times what we saw over the summer.”
“It’s encouraging to see these trends coming down, but they’re coming down from an extraordinarily high place,” she said on NBC’s “Meet the Press.”
Researchers at the University of Washington’s Institute for Health Metrics and Evaluation, publisher of a popular coronavirus model, are among those who attribute declining cases to vaccines and the virus’s seasonality, which scientists have said may allow it to spread faster in colder weather.
In the IHME’s most recent briefing, published Friday, the authors write that cases have “declined sharply,” dropping nearly 50 percent since early January.
“Two [factors] are driving down transmission,” the briefing says. “1) the continued scale-up of vaccination helped by the fraction of adults willing to accept the vaccine reaching 71 percent, and 2) declining seasonality, which will contribute to declining transmission potential from now until August.”
The model predicts 152,000 more covid-19 deaths by June 1, but projects that the vaccine rollout will save 114,000 lives.
Nearly 40 million people have received at least their first dose of a coronavirus vaccine, about 12 percent of the U.S. population. Experts have said that 70 percent to 90 percent of people need to have immunity, either through vaccination or prior infection, to quash the pandemic. And some leading epidemiologists have agreed with Frieden, saying that not enough people are vaccinated to make such a sizable dent in the case rates.
A fourth, less optimistic explanation has also emerged: More new cases are simply going undetected. On Twitter, Eleanor Murray, a professor of epidemiology at Boston University School of Public Health, said an increased focus on vaccine distribution and administration could be making it harder to get tested.
“I worry that it’s at least partly an artifact of resources being moved from testing to vaccination,” Murray said of the declines.
The Covid Tracking Project, which compiles and publishes data on coronavirus testing, has indeed observed a steady recent decrease in tests, from more than 2 million per day in mid-January to about 1.6 million a month later. The project’s latest updateblames this dip on “a combination of reduced demand as well as reduced availability or accessibility of testing.”
“Demand for testing may have dropped because fewer people are sick or have been exposed to infected individuals, but also perhaps because testing isn’t being promoted as heavily,” the authors write.
They note that a backlog of tests over the holidays probably produced an artificial spike of reported tests in early January, but that even when adjusted, it’s still “unequivocally the wrong direction for a country that needs to understand the movements of the virus during a slow vaccine rollout and the spread of multiple new variants.”
Where most experts agree:The mutated variants of the virus pose perhaps the biggest threat to the country’s recovery. One is spreading rapidly and another, known as B.1.351, contains a mutation that may help the virus partly evade natural and vaccine-induced antibodies.
Fewer than 20 cases have been reported in the United States, but a critically ill man in France underscores the variant’s potentially dangerous consequences. The 58-year-old had a mild coronavirus infection in September and the B.1.351 strain reinfected him four months later.
No matter what’s causing the current downturn in new infections, experts have urged Americans to avoid complacency.
“Masks, distancing, ventilation, avoiding gatherings, getting vaccinated when eligible. These are the tools we have to continue the long trip down the tall mountain,” Caitlin Rivers, an epidemiologist at Johns Hopkins University, said on Twitter. “The variants may throw us a curve ball, but if we keep driving down transmission we can get to a better place.”
About 36% of nonelderly adults and 29% of children in the U.S. have delayed or foregone care because of concerns of being exposed to COVID-19 or providers limiting services due to the pandemic, according to new reports from the Urban Institute and Robert Wood Johnson Foundation.
Of those who put off care, more than three-quarters had one or more chronic health conditions and one in three said the result of not getting treatment was worsening health or limiting their ability to work and perform regular daily activities, the research based on polling in September showed.
However, the types of care being delayed are fairly routine. Among those surveyed, 25% put off dental care, while 21% put off checkups and 16% put off screenings or medical tests.
Dive Insight:
The early days of the pandemic saw widespread halts in non-emergency care, with big hits to provider finances.
In recent months, health systems have emphasized the services can be provided in hospitals and doctors offices safely as long as certain protocols are followed, and at least some research has backed them up. Groups like the American Hospital Association have launched ad campaigns urging people to return for preventive and routine care as well as emergencies.
But patients are apparently still wary, according to the findings based on surveys of about 4,000 adults conducted in September.
The research shows another facet of the systemic inequities harshly spotlighted by the pandemic. People of color are more likely to put off care than other groups. While 34% of Whites said they put off care, that percentage rose to 40% among Blacks and 36% among Latinos.
Income also played a role, as 37% of those with household incomes at or below 250% of the poverty level put off care, compared to 25% of those with incomes above that threshold.
Putting off care has had an impact industrywide, as the normally robust healthcare sector lost 30,000 jobs in January. Molina Healthcare warned last week that utilization will remain depressed for the foreseeable future.
Younger Americans were also impacted, with nearly 30% of parents saying they delayed at least one type of care for their children, while 16% delayed multiple types of care. As with adults, dental care was the most common procedure that was put off, followed by checkups or other preventative healthcare screenings.
The researchers recommended improving communications among providers and patients.
“Patients must be reassured that providers’ safety precautions follow public health guidelines, and that these precautions effectively prevent transmission in offices, clinics, and hospitals,” they wrote. “More data showing healthcare settings are not common sources of transmission and better communication with the public to promote the importance of seeking needed and routine care are also needed.”
Molina’s net income fell sharply in the fourth quarter as the insurer was forced to refund rates to some of its state partners as COVID-19 continues to depress normal care utilization, CEO Joe Zubretsky told investors Thursday.
Although utilization remained curtailed, COVID-19 costs were higher in the fourth quarter than any other quarter in 2020, Zubretsky said. As such, Molina’s medical care ratio for the quarter increased to 90.8% from 86% the prior-year period.
Still, Molina remained in the black for the full year of 2020. Looking ahead, the company expects utilization to improve, though does not expect it to rebound entirely. At the same time, the company expects direct COVID-19 costs to come in lower than last year.
Dive Insight:
Insurers have largely remained unbruised from the pandemic, unlike some providers, but the fourth quarter was a different story.
The pandemic took a bite out of Molina’s net income in the fourth quarter as the company reported that figure fell to $34 million from $168 million in Q4 2019.
The biggest contributor to the impact on the bottom line was Medicaid refunds to states, including California, Michigan and Ohio. States have clawed back some of the money they pay insurers like Molina as members continue to defer care, which is a benefit to insurers as they then pay out less.
Molina painted a clearer picture of this scenario during Thursday’s conference call with investors.
For the full year, Molina estimated that medical cost suppression amounted to $620 million while direct COVID-19 costs amounted to $200 million. In other words, curbed utilization continued to outweigh direct COVID-19 costs, resulting in a $420 million benefit from the pandemic, which the company characterized as a surplus.
But states took back a total of $565 million through rate refunds. Overall, the net impact of COVID-19 was a $180 million hit to Molina for 2020 when factoring in other costs.
Looking ahead, executives seemed cautiously optimistic for 2021 but noted headwinds from the pandemic will persist. While the forecast reflects future growth, Zubretsky said, “it is a constrained picture” of the company’s potential earnings.
Some of those headwinds include Medicare risk scores that don’t fully capture the acuity of their Medicare members. As seniors put off care in 2020, companies like Molina were unable to capture diagnosis codes to help them determine how sick members are and the ultimate risk they pose.
Still, there are some bright spots. As the public health emergency is likely to be continued throughout the remainder of the year, it means that redeterminations will remain halted, or, in other words, Medicaid members will not be kicked off coverage.
This was a boon for Molina in 2020, as it allowed them to pick up a significant number of new members. Overall, it was a major catalyst for Medicaid membership growth in 2020, Zubretsky said.
Molina expects care utilization to improve this year but not fully return to normal. Instead, it expects utilization suppression to be about one third of 2020 levels.
Molina, which solely focuses its portfolio on government sponsored and marketplace plans, said it expects to pick up as many as 30,000 additional members during the Affordable Care Act special enrollment period.
Opening up a special enrollment period was one of the first moves made by the new administration in the White House. Zubretsky seems enthused by the recent moves through executive orders and the unfolding bill developments in Congress that are looking to raise premium subsidies on the exchanges.
Those early actions “just couldn’t be better for government sponsored managed care, and we’re pleased to see that progress already being made,” Zubretsky said.
HENRY KOTULA 