April 17, 2020

The Weekly Gist: The Brave New World Edition

by Chas Roades and Lisa Bielamowicz MD

We’re spending a lot of our time these days talking to member executives and others about what the world will look like as the coronavirus pandemic begins to recede, and what the new normal will be. It’s been a fascinating scenario-planning project so far, one that we’re calling “Brave New World”—spoiler alert, we’re not going back to the way things were, probably ever. The Huxley-inspired title is intentional, given some of the ideas we’ve heard about health surveillance technology and “immunity certificates”. So far, no mention of Scent Organs—one of the novel’s more inventive creations—although after weeks on end working from our basements, we’d welcome the addition of a Smell-o-Vision or Aroma-Rama device!

How about you? What are you expecting in the “Brave New World”? Let us hear your predictions for the healthcare world to come!


What happened in healthcare this week—and what we think about it.

Beginning the long, winding journey back from coronavirus

It was another brutal week in the coronavirus pandemic, with more than 2.1M cases and nearly 150,000 deaths worldwide. The US continued to be the hardest-hit country, reaching a daily record 4,591 deaths from COVID-19 on Thursday. The national death toll is now more than 35,000, though there are signs that the number of new cases in the US has begun to plateau, raising hopes that the worst days may be drawing to a close. Meanwhile, with strict stay-at-home measures continuing in most places across the country, the economic toll of the virus mounted. New unemployment claims rose by another 5.2M, bringing the estimated number of American jobs claimed by the virus to 22M, eliminating a decade’s worth of job growth, and raising the unemployment rate to an estimated 17 percent.

As the growth in new cases flattened, attention turned this week to plans to “reopen” the American economy. Despite insisting early in the week that he alone would decide when and how to reopen the country, President Trump yesterday unveiled a set of non-binding, “Opening Up America Again” guidelines for state and local officials to use in judging when to loosen restrictions. The guidelines suggest a three-stage, gated approach, gradually allowing individuals and employers to return to normal activities based on criteria including disease trends, hospital capacity, and the availability of robust testing. Progressing from one stage to the next is predicated on maintaining a downward trajectory in new cases—with any signs of a resurgence indicating a need to reimpose restrictions.

Missing from the White House plan are specific details about how states, cities, and healthcare providers are to procure and pay for the many millions of tests and extensive contact tracing that will need to be available to allow businesses, public transport systems, and other essential services to resume activity. By week’s end, about 3.5M coronavirus tests had been conducted nationally, but the daily number of tests conducted has plateaued, and the test-positivity rate is still troublingly high. Public health experts continue to warn that testing must ramp up significantly before any steps toward reopening can be considered, a difficult challenge given widespread reports of shortages of testing supplies and trained lab technicians. To bolster testing capacity, the Centers for Medicare and Medicaid Services (CMS) this week nearly doubled the amount it will pay laboratories to analyze tests using high-throughput equipment.

Three coalitions of states—in the Northeast, Midwest, and West Coast—were formed this week to coordinate regional efforts to reopen the economy. Among the issues they’ll need to address: interstate travel restrictions, coordinated purchasing of critical supplies, investments in contact tracing capabilities, and ongoing surveillance of the virus’ spread. With federal agencies taking a back seat to states (“You are going to call your own shots,” the President told governors on a call this week), it became clear that the road back from the coronavirus pandemic will be circuitous, with a patchwork of different timelines and approaches in different locations based on local conditions and resources. In the words of William Gibson, “The future is here—it’s just not very evenly distributed.”

Not jumping to conclusions on coronavirus treatment

Early reports of hastened recoveries among patients taking the antiviral drug remdesivir sent manufacturer Gilead Sciences’ stock soaring over 8 percent this morning, and contributing to an overall uptick in the market. The gains came after a scoop by healthcare news site STAT, which obtained a copy of an internal webinar from University of Chicago Medicine, where an infectious disease specialist discussed positive results from their early experience with remdesivir. The system recruited 125 patients into Gilead’s Phase 3 clinical trials for the drug; 113 patients had severe disease. The presenting physician reported rapid reductions in fever and improvements in respiratory symptoms, noting that just two patients had died, and most of the participating patients had already been discharged—on average after just six days, suggesting a long course of drug treatment may not be necessary.

The STAT leak comes on the heels of a NEJM article late last week, which reported clinical improvement of over two-thirds in COVID-19 patients who received remdesivir. Critics were quick to point out  numerous flaws in the study, including lack of a control group, cherry-picking of patients, and the deep involvement of the manufacturer in study design, many of which also apply to the University of Chicago report. In the thick of the pandemic, doctors and patients’ families are understandably motivated to get very sick patients access to any treatment that may help—but the resulting frenzy following the publication of early results may make it even harder to get good data to understand what works, and what doesn’t. In the words of one expert, “Fast trials are generally not very interpretable, interpretable trials are generally not fast”. In the search for a “COVID-19 cure”, it’s highly unlikely that any single drug will provide a cure for the viral illness, and the only way we’ll know if a treatment is truly working is to wait for the results of randomized, controlled trials—despite how frustrating it is to muster the patience to do so.

A landmark post-COVID physician group acquisition in California

Blue Shield of California announced last Friday that its healthcare services division, Altais, is acquiring Brown & Toland Physicians, a multispecialty network of 2,700 physicians serving 350,000 patients in the greater San Francisco Bay Area. Brown & Toland, formed in 1993, is a clinically-integrated network of independent physicians that has received much attention nationally for its risk-based contracting as both a Medicare Pioneer Accountable Care Organization, as well for its landmark contract to manage state workers and retirees in the California Public Employees’ Retirement System (CalPERS). While few details of the deal have been released, Altais says it will provide Brown & Toland with both capital for growth, and a technology platform that includes practice management, analytics tools, telehealth and electronic health record assistance. Brown & Toland’s CEO, Kelly Robinson, said the partnership would enable the group to expand geographically.

While Blue Shield’s purchase of Brown & Toland is the first noteworthy payer acquisition of physician practices we’ve seen in the post-COVID era, it’s likely just the first of many to follow in coming months. As we reported last week, the majority of physician groups—especially smaller independent practices—are suffering significant financial strain, which will likely make groups of all sizes more open to partnership options. Recent reports suggest that payers in particular may be weathering the economic shocks of the crisis relatively well. This week UnitedHealth Group (UHG) announced it exceeded Q1 earnings targets, and would maintain its pre-COVID earnings guidance for the year, citing savings from cancelled routine care and elective procedures. Should payers continue to fare well, it’s likely that UHG and other health plans could enjoy an advantage in deploying the capital necessary to roll up distressed physician practices.


A key insight or teaching point from our work with clients, illustrated in infographic form.

Comparing outcomes for COVID-19 and viral pneumonia patients

When predicting care needs, costs, and clinical outcomes for COVID-19 patients, many have looked to viral pneumonia patients as the best benchmark, yet we are now learning more about how the two populations differ. The graphic below shows new data from the United Kingdom, comparing outcomes for critical care patients with COVID-19 versus those with viral pneumonia. While only 14 percent more COVID-19 patients require mechanical ventilation, the mortality rate of COVID-19 patients on ventilators is about twice as high as that among viral pneumonia patients. Similar findings have been borne out in smaller studies completed by researchers in Wuhan and Seattle.

While the advanced respiratory needs of COVID-19 patients have been well documented, the UK study highlights that these patients require more advanced cardiac and renal support in the critical care unit than individuals with viral pneumonia. This is proving true in the US as well, where hospitals in New York City are finding that 20 to 30 percent of COVID-19 patients require dialysis. Many providers have raised concerns that standard dialysis equipment, like fluids, machines, and infusion pumps, as well as dialysis-trained nursing staff, are in short supply. Hospitals should review these findings and incorporate them into critical care surge plans, to ensure sufficient supplies of dialysis equipment and clinicians to handle the complex multi-organ needs of critically ill COVID-19 patients. 


What we learned this week from our work in the real world.

Making our facilities “the safest place you can be right now”

As health systems begin to contemplate bringing some office visits and elective surgeries back online, big questions loom over each decision. How can we make the environment safe for patients and staff? What will give consumers the confidence to enter a physical care site? We’ve spoken with a few systems who established COVID-dedicated hospitals, triaging all management of ill patients to a dedicated facility. The operations behind that are complex: how to inform the public where to go, for which symptoms? How will we transfer COVID-19 patients who present at other sites? And how will we ramp up if our dedicated bed and ICU capacity is exceeded? While there is no way to fully ensure a facility is “COVID-free”, these systems hope the move will make patients feel more confident in coming back to the hospital for other needs.

Preparing for screening and triage of every patient and worker who enters a facility is critical. Temperature testing on entry, which earns an “I was screened today” sticker, is a visual reminder that everyone must be checked. Creating a triage perimeter around the hospitaldirecting any patient with fever or respiratory symptoms to a dedicated tent or entrance, helps keep the ED as COVID-free as possible. Sensing that waiting rooms would make patients anxious even with distancing, one system created a process for patients to wait in their cars and be called into the doctor’s office or lab when a room is ready. And one Midwestern system is now reaping the benefits of a policy established over a month ago that any person entering a facility, for any reason, must wear a mask. Not only have their rates of staff infection been lower than expected, their chief strategy officer told us, “Coming into our building may be safer than going shopping at Walmart.” These kinds of strategies are just the beginning of what health systems will need to do to make patients not only willing to come in for care, but confident they’re receiving it at one of the safest places they can be right now.

A platform for regional collaboration on COVID-19

Many health systems have shared with us the challenges they’re facing in collaborating with other local providers around their COVID-19 response. With few state and local resources to coordinate procedures or capacity needs, communication between hospitals is often reduced to one-off calls, with the perception that real collaboration would likely slow down individual response efforts. We were impressed with the work of Mosaic Life Care, a four-hospital system based in St. Joseph, MO, to facilitate collaboration among regional hospitals. After getting inbound questions from neighboring hospitals, Mosaic’s executives invited leaders of ten small community and critical access hospitals from across their region to a weekly COVID-19 collaboration call. The sessions begin with an update on Mosaic’s status, patients tested and number positive, their current level of response, and clinical and operational insights, followed by a deeper discussion of one agenda item (topics have included PPE, surge planning, and resource availability), and conclude with a roundtable discussion.

While smaller hospitals are grateful for the thought partnership, good ideas have come from all corners of the region, with Mosaic implementing new practices they’ve learned from their neighbors. According to the system’s chief strategy officer, the calls have created a level of collaboration “that used to require driving 75 miles and meeting face-to-face”. We’re hearing from across the country that independent providers—both small hospitals and physician practices—are hungry for information. Establishing channels for regular communication and idea sharing around coronavirus response and support can create relationships and trust that will pay dividends long after the crisis has passed.


All the headlines in healthcare policy, business, and more, in ten minutes or less every weekday morning.

On last Monday episode, we heard from Politico’s Dan Diamond about how infighting, chaos and questionable science are impacting the Trump administration’s COVID-19 response. Diamond’s recent reporting has covered how decades of pandemic preparedness planning and lessons learned from previous administrations have been overlooked or ignored during this current crisis.

Coming up on this Monday’s episode, we’ll hear from Dr. Charles Dennis, Chief Medical Officer at the Carle Foundation, about how engineers and medical professionals at the Urbana, IL-based health system are working together to develop medical equipment for COVID-19 patients. Dennis says this kind of rapid problem solving was what the engineering-based Carle Illinois College of Medicine was founded to do. Make sure to tune in!

[Subscribe on Apple, Spotify, Google, or wherever fine podcasts are available.]


We would’ve worked harder, but we watched this instead.

All this time hunkered down at home has provided plenty of opportunity to catch up on our binge watching. We were excited for the return of HBO’s Westworld, but it’s been hard to muster the mental acuity to follow that show’s twists and turns (and to imagine Aaron Paul as anyone other than Jesse Pinkman). If you’re looking for a tech-thriller with a lower barrier to entry and minus the silly robots, may we suggest Devs, an eight-episode limited series from FX that just wrapped up on Hulu? In tune with our times, it revolves around a secretive, big data-driven Silicon Valley company, and the questionable uses it makes of the huge amounts of information it collects. Nick Offerman is brilliant as the brooding, beardy megalomaniac at the helm of the company, whose pet project has run completely beyond any ethical boundaries. The young British actress and model Sonoya Mizuno is a quiet revelation as our heroine, a young programmer on a quest to learn the secret that led to her coworker-boyfriend’s death. For all its car chases and espionage intrigue, the show, written and directed by Alex Garland (Ex Machina), is a cerebral and slow-moving affair, with a haunting soundtrack and an ensemble cast full of fascinating characters. At its heart, Devs is an exploration of free will versus mechanistic determinism, a well-worn sci-fi trope. But it doesn’t overreach, and by the eighth and final episode you’ll be left with plenty to think about. Well worth the time.


We said it, they quoted it.

Billions Going to Hospitals Based on Medicare Billings, Not COVID-19
Miami Herald/Kaiser Health News; April 12, 2020

“‘It seems weird that they wouldn’t just target areas geographically based on where the surge has been,’ said Chas Roades, CEO of Gist Healthcare, a consulting firm.

“Issuing the funds based on Medicare revenue ‘allowed us to make initial payments to providers as quickly as possible,’ an HHS spokesperson said Friday. Some of the money was expected to go out as soon as Friday in electronic deposits.”

Bracing for Coronavirus but Losing Money Every Day, This East Texas Hospital Had to Cut Employees
The Texas Tribune; April 16, 2020

“Lisa Bielamowicz, a physician and the president of the consulting firm Gist Healthcare, said some hospitals are reducing head counts to match a reduced volume in patients. But others are ‘being really aggressive’ about trying to keep people on their payroll, including by retraining them or being more flexible with paid leave benefits.

“Hospitals have told her 50% or more of their beds are empty now, compared with usual rates, and some individual health systems have estimated a loss of tens or even hundreds of millions of dollars in their projections.

“‘Houston and Dallas are starting to see more COVID patients, but for a lot of hospitals in Texas and around the country, they’re still awaiting the surge,’ Bielamowicz said. ‘At the same time, they now have been looking at a month or more of their surgery centers and hospitals literally emptying of patients.’”

Detroit Hospitals Are Laying Off Workers by the Hundreds Even As Pandemic Rages
Detroit Free Press; April 16, 2020

“The problem facing hospital systems across the state is hardly unique to Michigan, said Chas Roades, CEO of the Washington-based healthcare consultants, Gist Healthcare. ‘Hospitals everywhere are struggling with a real economic challenge right now,’ he said.

“That’s because hospitals, to varying degrees, rely on elective surgeries for ‘their income, their profitability,’ he said. ‘With the shutdown, there’s just not enough money to pay everybody to do the work that is not being done right now,’ Roades said.”


Stuff we read this week that made us think.

What does a reopened America look like?

Even though many conversations with friends and family still start with the phrase, “When things get back to normal…”, it’s becoming increasingly clear that the country will not return to anything like the “normal” we experienced just two months ago. An article this week in The Atlantic provides a vision of what the next normal may look like, and how we’ll be living our lives during “our pandemic summer”. Across the next few months, social distancing restrictions will be relaxed—and the extent to which we can manage through that process without debilitating spikes in infection will be determined by our ability to test and isolate infected patients. Even by the most aggressive estimates of the numbers of asymptomatic Americans potentially infected, we are certainly far from the 60 to 80 percent rates of infection and recovery needed to provide “herd immunity” and functionally suppress the virus within the population. Reopening may allow friends and family to meet again, but work is likely to look markedly different, with staggered shifts to reduce contact. Travel will likely remain flatlined, and we will all be wearing masks for work and leisure. Large gatherings, like concerts and sporting events, are likely off the table until next year, or maybe even longer.

So how long will we be playing “whack-a-mole” with COVID-19, with cycles of resurgent infection and reactive returns to social distancing? Writing in Scienceresearchers modeled a host of scenarios to ascertain the dynamics of cycling COVID-19 infection based on differing rates of immunity, transmission, and seasonality. Their sobering conclusion: we may be dealing with intermittent social distancing into 2022, or else risk overwhelming critical care capacity. How can we mentally prepare for this? Atlantic author Ed Yong draws a parallel with the experience of former US Navy Admiral James Stockdale as a POW in Vietnam. During his grueling seven years in captivity, Stockdale noted that the most optimistic prisoners eventually broke, crushed by one missed release deadline after another. The ability to survive, according to Stockdale, came from the ability to combine the belief you will eventually prevail with the discipline to confront the facts, no matter how brutal they are. Our “invisible enemy” isn’t going away anytime soon—we must confront it with resolve, and focus on the long-term ambition of building a healthcare system and nation that is stronger and more resilient than ever before.

Keeping an eye on consumer sentiment

As businesses in healthcare and beyond try to plan for the “Brave New” post-pandemic world, one of the key variables to consider is how consumers will behave. As most shopping has shifted online, there’s already fascinating data available on how our purchasing behavior has changed. Compared to a year prior, the fastest-growing online purchase categories last month were a telling reflection of where our consumer brains are now. We’re buying more disposable gloves, cough medicine, and pain relievers, but also more bread machines, staple foods, and fitness equipment. And a lot fewer suitcases, cameras, and swimsuits. We’re hunkering down. But what about when restrictions are lifted, and we emerge blinking into the summer sun?

A great resource worth keeping an eye on is Morning Consult’s weekly coronavirus tracking survey, which polls consumers on the personal, political, and economic impact of the pandemic on their views. (Full disclosure: Morning Consult was founded by a brilliant former colleague of ours in 2013.) Half of us expect the shutdown to last more than two months, and more than 75 percent want to prioritize health outcomes over economic recovery. We’re spending less and holding off on major household purchases—no surprise. Of particular interest is data on when we’ll feel comfortable returning to our normal routines. It’ll be more than three months until most will be willing to eat at a restaurant, go to a shopping mall, or take a vacation. As we talk to our members about how they’re planning for a return to normal operations, these kinds of questions loom large: when will Americans feel safe walking into a clinic or hospital surgery center again? It may not be soon. On the other hand, maybe there’s hope from one (very) leading indicator: notwithstanding the events of the past two months, Carnival reported this week that cruise bookings for 2021 are running strong. Never bet against the American consumer.

It’s end of another grim week, but at least there’s a glimmer of light at the end of the tunnel—to paraphrase Churchill, perhaps we’re at the “end of the beginning” of the era of coronavirus. Thanks for taking time to read our work, and let us hear your feedback, suggestions, and predictions for the road ahead. If you’re feeling generous, please share this with a friend or colleague, and encourage them to subscribe, and to check out our daily podcast.

Most importantly, please let us know if there’s anything we can do to be of assistance in your work. You’re making healthcare better—we want to help!

Best regards,

Chas Roades
Co-Founder and CEO

Lisa Bielamowicz, MD
Co-Founder and President