On the Radio Advisory podcast, host Rachel Woods spoke with Christopher Kerns, Vice President of Executive Insights at Advisory Board, about how the Covid-19 epidemic has and has not changed Americans' perspective of the U.S. health care system—and what the epidemic could mean going forward.
How Covid-19 will impact the financial outlook for the health care industry
Read an excerpt from the podcast, and then download the episode to hear the full conversation:
Rachel (Rae) Woods: Christopher, take me into what's happening right now. How has Covid-19 changed the perception of the industry?
Christopher Kerns: It certainly improved it. Early polling is showing some boost in perception for a number of different players across our industry. It's looking real real good for hospitals: 92% of people approve of how they've handled the crisis, and nearly two-thirds have a more positive view of hospitals because of their response to the Covid-19 epidemic. The same is true with clinicians; 68% of those polled said they had a more positive view of providers because of how they've reacted to Covid-19.
That's probably unsurprising given how clinicians have been correctly painted as heroes in this crisis by the media and you've seen a huge focus on their stories in newspapers, on TV shows, and in public events. And frankly, I think you'd have to be made out of stone if you're not going to be moved by those 7:00 p.m. cheers that you're hearing for front-line health care workers in cities around the world. They've put themselves in danger and they've done so for the rest of us and that can't help but come with enormous amounts of gratitude.
Woods: Positive changes for nurses, practitioners, physicians, and also for hospitals. How about the rest of the industry?
Kerns: I think it's a little too soon to be sure. Polling is a little limited at the moment, but pharma and insurance have certainly fared no worse, and the efforts to develop vaccines, waiving patient costs during the public health emergency, I think that's going to be beneficial to them. But we know that perception has not been kind to one player in the industry, and that is post-acute care. About a third of all Covid-19 infections nationwide have occurred in nursing homes. As we see more public understanding of the risks that these settings pose for new infections, I think we've seen a huge decline in the perception of post-acute care.
Woods: And, let's talk about the impact that that declining public perception is actually going to mean for the post-acute space.
Kerns: I think it could have some long-lasting impacts; some positives and some negative for the industry. Let's start with the positives. There's likely to be more public support for enhancing staffing and safety protocols in nursing facilities. Although, the funding remains in question. And there will likely be a greater focus on safety and quality in nursing home referrals, for sure.
But on the downside for post-acute care facilities, the Covid-19 epidemic is likely going to accelerate the already growing trend for aging-in-place; using remote monitoring and telehealth to allow a lot more seniors who need some kind of assistance to remain in their homes and thus get less exposure to future outbreaks.
Woods: And I should mention, we're actually going to be going deep on what some of these changes mean for the post-acute space in a future episode. So Christopher, none of these polls are perfect. I'm curious, why should it actually matter if these different players are being framed as either the "hero" or the "bad guy"?
Kerns: Well, I think there are things that are obvious PR boosts, such as hospital leaders taking pay cuts, and publicly fighting to secure PPE and supplies for their staff needs. We've seen so many leaders doing so many innovative things creating different in-kind partnerships, and getting very creative to get their hospitals ready for a possible surge.
And then there are those things that are obvious PR boosts to certain players that kind of fell into their lap. For example, it's likely that lower utilization of health care overall will push health plans to send out some hefty rebates to members given how much money they've saved on scheduled procedures. It's hard to be angry at that.
There also are the hard choices that leaders are going to have to make that aren't going to look good in the public eye, but that they may be forced to do because of finances. So, take staff furloughs. I don't think anyone likes to see the optics of hospitals or health systems or medical groups laying off huge numbers of physicians or nurses. Especially after the Covid-19 epidemic, or during a health care crisis. But that's just the reality of what some hospitals are going to have to do, in light of some of the financial challenges that they're facing.
Woods: So let me preface this question by admitting that I'm a little bit of a skeptic. Should public perception play a role in the decisions that health care leaders make?
Kerns: I mean, I think you always want your segment of the industry and your particular organization to be viewed well. Especially if you operate in a competitive market, that can make the difference in a patient going to you versus a competitor. That's just reality. And as hospitals and physician groups look to some of their future investments, having a positive public perception certainly helps with the price hikes they're going to want to finance those investments.
But, at the same time, perceptions are fleeting. I will give you an example. Around 60% of people in 2000 said the health care system was in a state of crisis and 40% said things were just hunky dory. Then the September 11th terrorism attacks happen and we see the heroism of the fist responders and these numbers flip: 60% approval for the industry. But a year later, perceptions reverted to the norm. And it's been a remarkably stable perception. It's not like it varies a ton from year to year. It is quite possible that 2001 and 2020 are simply outliers.
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