SPECIAL SECTION: The COVID-19 Crisis
The COVID-19 pandemic has rearranged not only day-to-day living patterns in the United States and worldwide; it has also completely shifted the operational landscape of U.S. healthcare
By Mark Hagland F
or a few years now at least, there has been a lot of discussion about disrup- tive elements emerging in U.S. health-
care, such as CVS’s acquisition of Aetna and the potential minute clinic/phar- macy benefi ts management powerhouse that might be created over time out of that transaction; or the emergence of an agree- ment among Amazon, J.P. Morgan Chase, and Berkshire Hathaway two years ago, to create a joint venture that might rearrange the landscape around consumer naviga- tion of the healthcare system (which last year acquired the name “Haven”). But what about pandemics…? The fact is that the disruption being cre-
ated across U.S. society, and indeed, global society, by the COVID-19 pandemic, has been tremendous, and unprecedented. At the time of this writing, the numbers of both confi rmed cases and deaths from COVID-19 in the United States were ris- ing so fast that any reference here would certainly be outdated by the time this went to press. Suffi ce it to say that no disease outbreak in contemporary history has had the same impact on our country or the world. Indeed, the only pandemic that comes to mind that had such a broad reach was the “Spanish fl u” pandemic of 1917-1918, and that was over a century ago, and played out differently and under very different societal circumstances. So COVID-19 has been devastating for U.S. and global society. But it has also specifi cally disrupted the U.S. healthcare delivery system on an unprecedented level. In several major cities as well as in many smaller cities and small towns, hospital beds have been fi lled to capacity, ICUs have been fi lled, personal protective equipment (PPE) has run out or nearly so, signifi cant numbers of clinicians and hos- pital and clinic staff members have been
sickened, and a shortage of ventilators has imperiled patients nationwide. In addition to the immediate patient
care and care management issues that the pandemic has created, it has also dealt a body blow to provider fi nances. As the Chicago-based Kaufman Hall consulting fi rm reported in late April in its “National Hospital Flash Report,” “Hospitals across the country took a fi nancial beating in March, as the fi rst effects of the COVID- 19 pandemic hit the industry, particularly in the second half of the month. Volume and revenue declines, along with fl at expenses, resulted in a dramatic fall in margin within a matter of weeks, plung- ing not-for-profi t hospitals, which histori- cally operate on thin margins, deep into the red.” And that was the fi rst March- based, data.
One of the core challenges is that when it comes to the COVID-19 pandemic, everything—everything—turns out to be deeply interconnected. As COVID- infected patients have surged into hos- pitals, their care has required intensifi ed staffi ng; careful planning for surge capac- ity in terms of general med-surg beds, and most of all, in terms of ICU beds; the planning for surge capacity in terms of the need for ventilators; and for phy- sician, nurse, respiratory therapist, and other clinician staffi ng, as well as general non-clinician staffi ng. And of course, the fact that the vast majority of hospitals followed guidelines issued in March by the Centers for Disease Control and Prevention (CDC) and canceled or post- poned all or nearly all elective surgeries in March, in order to prepare the way for surges of COVID-19 patients, has meant devastating fi nancial losses nationwide. As Advisory Board leader Christopher Kerns confi rmed to us, 51 percent of
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hospitals’ revenues come from elective procedures, while a large bulk—at least 60 percent of hospitals’ positive margins overall—come from those procedures. So COVID-19 has profoundly dis- rupted the operations of
hospitals,
medical groups, and health systems. But the one bright spot in all this has been around telehealth. The announce- ment on March 30 by the Centers for Medicare & Medicaid Services (CMS) of a series of blanket waivers around care delivery, with its major focus being tele- health, instantly revolutionized health- care delivery, with a temporary lifting of the vast web of restrictions around, among other things, interstate licensing of physicians and nurse practitioners. Industry observers are predicting that the relaxation of those restrictions on clinical practice will inevitably be made permanent. What’s more, facing the challenge of having to minimize the potential for infection all around while continuing to see patients, hospitals, emergency departments, medical clinics, and other patient care organizations have shifted dramatically quickly to telehealth-facil- itated care delivery. Within weeks of CMS’s announcement, huge numbers of patient care organizations had already shifted as much care delivery as pos- sible to telecare.
So the U.S. healthcare system is going
through enormous upheaval and forced change right now. But in the midst of the crisis, ingenuity and innovation are emerging everywhere. In this Special Section, we present arti- cles on innovations and other important developments in the industry, around the COVID-19 crisis. We hope they will be useful and helpful to our readers. HI
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