- US' confirmed cases double
The dramatic growth of Covid-19 in the United States continues, with the number of confirmed cases doubling over the past week to almost 400,000. The domestic death rate continues to climb as well, with the U.S. picture remaining similar to the hardest hit countries of Western Europe.
- New York may be flattening the curve—but most states have yet to hit the peak
Although many states have yet to see the peak of the virus's spread, for the first time there are signs that New York may be flattening the curve. The death toll in New York City was still increasing as of April 7th, but the city is seeing decreases in daily ICU admissions, intubations, and three-day hospitalization rates.
- Some good news: Greater testing availability, fewer ICU bed shortages
The past week has seen additional good news on at least two fronts: a reduction in projected ICU bed shortages and continued increases in the availability of testing. States across the country have mobilized in advance of surges, finding (or creating) more ICU capacity. Continued adherence to aggressive social distancing measures seems to have slowed the growth rate in some of the hardest hit parts of the country.
Consequently, a situation that appeared dire just one week ago now appears much more manageable, with only a handful of states projected to fall short of the necessary number of beds. Additionally, more than one million Covid-19 tests have been run over the past week, providing a much clearer picture of incidence rates across the United States.
- Public and private sectors mobilize to find Covid-19 drug treatments
The public and private sectors have moved aggressively to accelerate the development of vaccines and the availability of drugs with potential to treat Covid-19. While success is far from certain, government funding, price cuts by certain key suppliers, and a series of moves by the FDA to streamline approval processes are all aimed at expediting the discovery of—and access to—effective prevention and treatment.
- Hospitals ramp up emergency plans for staffing, PPE, and patient throughput
In states that have not yet seen peak demand for COVID-19 care, hospitals continue to develop and implement emergency plans for staffing, personal protective equipment (PPE), and patient throughput.
Much of the attention paid to staffing has been focused on the nursing workforce, with health systems considering all available alternatives including redeployment, cross-training, recruitment, and innovative staffing models. Supply chain teams are partnering with local and regional manufacturing to supplement existing supplies of PPE and other essential items. And health systems in states such as Washington and Maryland are working with post-acute care providers and public health agencies to improve the safety and efficacy of discharging patients to their homes or to post-acute care facilities.
- CMS deploys first round of payments from the CARES Act—but ramifications unclear
The financial impact of Covid-19 for health systems and physician practices—which has loomed like a specter over the industry for several weeks—is leading more organizations to implement drastic measures such as furloughs, especially for non-clinical staff. Against this sobering backdrop, CMS this week released the initial round of payments from the CARES Act emergency fund.
Though this is clearly good news for the industry, it is not yet clear if the money will go to those most in need of support, as CMS prioritized speed of payment in opting to allocate funds based on health system fee-for-service Medicare revenue. Health systems with payer mixes more heavily weighted toward commercial insurance, Medicaid, or Medicare Advantage may find themselves comparatively underfunded.
- Health systems urged to prepare for three 'waves of impact'
Notwithstanding the availability of increased government funding, health systems are advised to develop contingency plans for three waves of impact from the current pandemic: immediate cash flow needs (due to foregone revenue from elective procedures and surge expenditures for PPE and other supplies), margin management across the balance of 2020 (due to deteriorating case mix), and longer term competitive repositioning to capture growth once the crisis subsides.
Health systems that plan poorly now may find themselves adversely impacted at all three phases, while those that manage most effectively through the current crisis will likely be uniquely well-positioned (with capacity and budget) to capture latent demand for surgical procedures and other elective care.
- Health systems should test post-Covid-19 forecast—especially for payer mix
As health systems begin planning for a post-Covid-19 world, they should test their forecasts under a range of assumptions, starting with the likely change in payer mix. The dramatic increase in unemployment in recent weeks will obviously reduce the number of commercially insured. Unemployment is only one variable to consider though. What is far from clear is how employers will behave—and what changes in benefits structures they may implement—across the next 18 to 24 months.
Lessons from the 2008 global financial crisis, though a tempting baseline for initial analysis, may not be relevant to the situation today. The intervening 12 years included the launch of the ACA, the advent of insurance exchanges, and Medicaid expansion in 36 states. In short, employers have many more options to consider if they decide to drop or dramatically reduce their health benefits spending.
- Health systems with telehealth capacity likely to have advantage in coming months
The weeks and months ahead will shine additional light on a number of important questions for the industry. One example is telehealth. Will payers continue to offer and expand reimbursement models that encourage use of virtual care delivery? Will providers use the infrastructure and processes they are building today, as part of a longer-term shift in care models and patient access? In a world where case mix may require finding lower cost ways to meet the needs of patients in all demographic groups, systems with strong virtual care capabilities will likely have significant advantages.
- Covid-19 response likely a key test of 'the value of systemness'
Similarly, the response to Covid-19 will likely prove a significant test of the value of systemness. Health systems bring significant strengths to the current crisis: financial reserves, multiple sites of care across a range of acuity, the ability to shift labor and supplies to areas of peak demand. Will these assets enable a truly superior level of care, better outcomes, and a faster path to a region’s economic recovery? Or will systems be unable to capitalize as a consequence of bureaucracy, organizational inertia, slow decision-making, and lack of coordination in execution?
Slide deck: Your 45-minute Covid-19 update
Stay up to date on the Covid-19 epidemic with this on-demand webinar and downloadable slides from April 9, 2020.