April 10, 2020

The Weekly Gist: The Cruelest Month Edition

by Chas Roades and Lisa Bielamowicz MD

April is the cruelest month, breeding
Lilacs out of the dead land, mixing
Memory and desire, stirring
Dull roots with spring rain…

At the end of one of the darkest weeks in our nation’s history, confronting death and hardship and grief that seem to mount with every day, the opening lines of Eliot’s The Waste Land ring true. The contrast of nature’s springtime renewal with the pain we’re living through is stark. What’s keeping us going are those “lilacs out of the dead land”—stories of hope and inspiration amid the horror. We’ve been awestruck by what we’re hearing from healthcare leaders across the country, who have shared story after story of doctors, nurses, caregivers, and others exhibiting incredible bravery, grace, and compassion as they care for their patients and communities. This holiday weekend, please join us in thanking these heroes for their important work.


THIS WEEK IN HEALTHCARE

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

Nearing the peak of the coronavirus pandemic

By week’s end, 100,000 people had died worldwide from COVID-19, with more than 18,000 deaths in the US. More than 7,000 of those deaths were in hard-hit New York, with other “hot spots” like New Jersey, Michigan, Louisiana, and Illinois accounting for thousands more. Early data emerged this week indicating that African-Americans were disproportionately affected by the disease, and were dying at high rates. The US death rate continues to accelerate, although one hopeful indicator emerged this week as the “doubling rate” of new coronavirus cases began to slow in areas most impactedThat “flattening of the curve” pointed to the success of widespread stay-at-home orders and social distancing measures, leading President Trump and other White House officials to publicly discuss the possibility of “reopening” the American economy at the end of April. Public health experts, however, cautioned against loosening restrictions too quickly, for fear of an uptick in infection rates. In a White House briefing this afternoon, the President’s top health advisors underscored that it is “too soon” to pull back from aggressive social distancing measures.

Both the optimism and caution on “flattening the curve” come from different interpretations of models of virus transmission. This week, the model that the White House is relying on (from the University of Washington’s Institute for Health Metrics and Evaluation—IHME) was revised downward significantly, lowering estimates of potential deaths from the initial projection of 100K-240K to an expected 60K by the end of August. The model suggests that the US will hit peak healthcare resource use tomorrow—April 11th—and that the highest number of US deaths will occur today (a projected daily peak of 1,983). Importantly, the IHME model assumes that full social distancing measures stay in effect until the end of May. An April 9th internal White House document, leaked to the New York Times, describes a “best guess” of the implications of ending shelter-in-place orders after only 30 days—a month short of the IHME assumption—including 200,000 deaths if restrictions are lifted early.

Those projections will be balanced against the urgency of rescuing the American economy from the impact of widespread shutdown. This week, 6.6M more Americans filed for unemployment, bringing the national unemployment rate to an estimated 12 to 14 percent, according to economists—the worst rate since the Great Depression. JPMorgan analysts projected that US unemployment would eventually reach 20 percent, and that GDP could be down as much as 40 percent by the end of the second quarter. Restarting the American economy, on whatever timetable, will depend on two important capabilities: widespread testing to determine who has been infected with the virus, and “contract tracing” to understand how the virus might spread. As America approaches the end of the deadliest week of the coronavirus pandemic, expect much discussion in the weeks ahead of how to conduct testing and tracing. The critical issue: balancing civil liberties and individual rights with what could become a new healthcare “surveillance state”.

Providing $81B in emergency funding to COVID-hit hospitals

To help hospitals offset the steep losses caused by the cancellation of profitable surgery cases and the costs associated with COVID-19 care, the Centers for Medicare and Medicaid Services (CMS) announced this week that it has distributed $51B in advance payments, along with $30B in emergency grants. The former is part of the Accelerated and Advance Payment Program (AAPP), which allows hospitals to apply for early access to payment from Medicare, subject to later reconciliation and payback (along with 10.25 percent interest charges) based on care actually delivered. Of the 32,000 requests for advance payment received by CMS, it has approved 21,000, according to the agency. Meanwhile, as part of the CARES Act’s $100B “provider fund” relief package, CMS Administrator Seema Verma announced this week that her agency would deliver $30B of grants to hospitals immediately. These grants will be distributed based on historical Medicare billing, and funds will be directly deposited in hospitals’ bank accounts, without an application process and with “no strings attached”.

Basing the allocation on historical Medicare billing raised red flags among industry groups, including public and safety-net hospitals, and those who treat large populations of Medicare Advantage (MA) beneficiaries, who may be at a disadvantage. The Greater New York Hospital Association (GNYHA) said in a press release that the allocation approach “is woefully insufficient to address the financial challenges facing hospitals at this time, especially those located in ‘hot spot’ areas such as the New York City region.” While the allocation methodology needs refinement to address these issues, the quick cash infusion will come as welcome relief to hospitals who have seen their revenue decline by 50 to 75 percent in just the past month. More help may be on the way, in the form of a fourth-round of stimulus funding from Congress that may include another $100B for hard-hit providers. Stay tuned.

Biden expands his healthcare proposal after Sanders’ exit

On the heels of Sen. Bernie Sanders’ exit from the 2020 presidential race on Wednesday, presumptive Democratic nominee and former Vice President Joe Biden began to outline his vision for healthcare, proposing to lower the Medicare eligibility age from 65 to 60. Biden’s expanded coverage proposal aims to balance the need to appeal to Sanders’ base and a growing number of unemployed Americans with efforts to win over centrists and Republicans in the general election, for whom healthcare is sure to remain front and center. Details on the proposal—announced concurrently with one to expand student debt forgiveness programs for low- and middle-income families—are scarce, other than that it would be financed from general revenue, in order to protect the Medicare Trust Fund.

According to the most recent census numbers, around 20 million Americans are between age 60 and 64. Allowing them to opt into Medicare would lower the number of uninsured individuals in this demographic, as well as the healthcare cost burden of these individuals. A substantial portion of this age group joining Medicare would likely result in lower premiums for commercially insured individuals of all ages, as the 60-64 age cohort is among the most expensive to insure. But for many health systems and physician groups, this cohort of “rising seniors” accounts for much of the profitable volume. Should Biden’s proposal become reality, providers would stand to lose a significant portion of their commercial revenue as these patients switch to Medicare, which is unlikely to be offset by smaller gains in revenue from formerly uninsured patients who seek care. But unemployment is likely to remain high for quite some time in the wake of the coronavirus pandemic, and older workers may have the most difficulty regaining employment in an unstable economy, making Biden’s Medicare expansion proposal particularly relevant in the current environment.


GRAPHIC OF THE WEEK

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

Primary care practice economics under extreme pressure

While many physician practices in the COVID-19 era are attempting to go virtual, both lower patient volume and reduced reimbursement make this a financially tenuous strategy, especially for small, independent primary care groups. As the graphic below shows, the vast majority of primary care clinicians surveyed report significant financial strain, with more than six in 10 practices unsure of their ability to remain open in four weeks’ time. Our illustrative model of a five-physician, independent primary care practice shows that the practice would be significantly underwater by June if today’s social distancing measures continue—and this assumes that 80 percent of in-office visits can be converted to virtual right away, and that the practice starts with three weeks cash-on-hand. While Medicare’s temporary reimbursement of telemedicine at parity with in-person visits helps soften the blow, much of the shortfall results from the loss of ancillary revenue from minor in-office procedures and vaccinations, along with lower commercial reimbursement of virtual visits.

While this financial impact will vary practice-to-practice based on commercial rates and payer mix, physicians with more capitated reimbursement stand to fare better than their fee-for-service colleagues. This may bolster calls for a more rapid shift to this model of payment. Many practices can tap into available lines of credit or take advantage of benefits being offered by the government under the CARES Act, such as small business loans and prospective Medicare payments. But many are likely to furlough staff and even close their doors, reducing primary care access vitally needed during this pandemic, especially in rural areasThis could also present a buying opportunity for the wide range of physician aggregators (payers, private equity, and health systems) interested in scooping up these practices at a discount before they go out of business—likely resulting in large shifts in the independent physician landscape over the next year.


THIS WEEK AT GIST—ON THE ROAD PHONE

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

What will it take for patients to come back?

This week, more health systems are feeling greater confidence in their ability to manage through the coronavirus crisis. Some are working their way through a flattened curve. Others, having devoted the past month to round-the-clock preparations, are in a moment of calm before the storm, feeling good about the plans they’ve put in place. In all but the hardest hit areas, leaders have started to think about what comes next. Several conversations this week showed the complexity that will be involved in bringing healthy patients back to care sites for routine and elective services, once the pandemic has subsided. Some systems are already beginning to bring delayed surgeries back in “non-COVID” facilities. They are starting with cases that are critical, but amenable to a short delay. As one CMO told us, “If a patient is waiting to have her cancer removed, I don’t think she’d call that surgery ‘elective’”.

Moving beyond those initial emergent surgeries, questions will arise about how to make patients who are scared to eat out in a restaurant feel comfortable coming into an in-person care setting. What would it mean for a facility or group of providers to be classified “COVID-free”? Will patients be willing to drive further for minimized risk, creating an opportunity to fast-track some service rationalization plans? Concerns will need to be addressed about the feel and flow of the care space itself. Even if patients are spaced six feet apart, waiting rooms are likely a thing of the past. And even if it doesn’t directly translate into lower infection rates, offices are going to have to feel light, new, and hyper-clean, or as one chief strategy officer told us this week, “Patients are going to want to smell fresh paint.” We’ll share more as we work with members to think through the complexities of returning to a “new normal” of care.

Making sure no one dies alone

As ICUs have filled with COVID-19 patients, families have been prevented from visiting critically ill relatives, even as death becomes imminent. This has also taken a toll on healthcare workers, who have anguished over their inability to provide the kind of human touch they’re accustomed to. We were inspired by the work of the team at Fountain Valley, CA-based MemorialCare to facilitate family connections and human touch at the end of life. The work was inspired by the experiences of a clinical director there, who lost both of her parents to COVID-19 at a faraway hospital, and was unable to visit before they died. Fortunately, the hospital had a process for her to visit via FaceTime with the nurse who was holding her father’s hand as he passed. MemorialCare leaders subsequently gathered iPhones and iPads donated by the community, and asked staff to return all company-issued iPads that weren’t absolutely critical for their jobs, so they could be repurposed for a “No One Dies Alone” initiative.

The devices are now used to have “LOVE” (Lead, Offer, Validate, Expect Emotion) conversations at the end of life, for family members who cannot be at the bedside. The iPads can also be used for longer family “vigils”, to help maintain contact. Pastoral care and palliative care teams have established processes for supporting families who can’t be at the bedside, including a conversation guide for nurses and other staff to guide families through their last exchanges with a loved one. Hearing the details of the initiative brought tears to our eyes, and deep appreciation for how a large team across a system—doctors, nurses, chaplains, physician liaisons, information technologists—quickly came together to bring healing, comfort and respite to patients and families in their most difficult hours.


THIS WEEK AT GIST—ON THE PODCAST

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

On last Monday’s episode, we heard from Rosemarie Day, CEO of consulting firm Day Health Strategies and author of Marching Toward Coverage. She told us that the coronavirus pandemic is exposing coverage gaps that lay bare the need for universal health coverage. On Wednesday, we heard from Privia Health CEO Shawn Morris and Chief Clinical Officer Dr. Keith Fernandez, who detailed the quick move to virtual care at Privia practices, and how they’re increasing remote patient monitoring and expanding their reach in the health system physician practice space. On Friday’s episode, we heard from Catalyst Health Network CEO Dr. Christopher Crow, who shared how commercial payers can change the way they pay primary care physicians for care, to help stabilize this critical sector of the delivery system.

Coming up on next Monday’s episode, we’ll hear from Politico’s Dan Diamond. He’ll discuss his recent reporting on how infighting and chaos at the Department of Health and Human Services have hampered the Trump administration’s response to the coronavirus pandemic. Don’t forget to tune in!

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


ON THE GIST TURNTABLE

Give this a spin—you might like it.

Amid all the awfulness about COVID-19 this week came the especially difficult news that the virus had claimed country-folk legend John Prine at age 73. The past few days have seen a number of great retrospective pieces about Prine’s legacy—he was truly one of the greatest songwriters of the past 50 years, and much of his work has found its way into the American Songbook, a euphemism he surely would have made fun of, and probably did. It wasn’t just pollen causing the tears to flow during a quarantine-walk, end-to-end re-listen of Prine’s 1971 self-title debut album. Recorded on Atlantic Records after Prine was “discovered” at a Kris Kristofferson club gig, John Prine contains many of his most revered songs, and sounds as fresh and relevant today as when it was released. Prine’s wry, deceptively simple songs share concerns about the state of the environment (“Paradise”), the plight of veterans (“Sam Stone”), the treatment of the elderly (“Hello in There”), phony patriotism (“Your Flag Decal Won’t Get You Into Heaven Anymore”), and the quiet tragedy of unhappy marriage (“Angel from Montgomery”). It also features some of his most memorable lyrics—including on “Far From Me” (Prine’s personal favorite), a heartbreaking song about love and loss, in which he sings, “Ain’t it funny how an old broken bottle/Looks just like a diamond ring”. Put it this way: Bob Dylan won a Nobel Prize for his songwriting, and even he recognized Prine as a grand master. The songs on this landmark album have been famously covered by Johnny Cash, Bonnie Raitt, John Denver, Joan Baez, John Fogerty, and the Everly Brothers, among others—a tribute to the greatness of the work. This weekend, set aside some time to listen to some John Prine. He would have loved being a balm for these troubled times.


WHAT WE’RE READING

Stuff we read this week that made us think.

Grand rounds as “must-see TV”

If you, like us, are feeling overwhelmed by cable news “chat panels” on coronavirus, we suggest switching off CNN and firing up YouTube, to catch yesterday’s episode of the UCSF Department of Medicine’s Grand Rounds. Chair of Medicine Dr. Bob Wachter moderated an expert panel of the school’s epidemiology, digital health, hospital, and emergency medicine experts, who provided insight and synthesis on a huge range of COVID-19 topics. Why was the Bay Area able to effectively “flatten the curve”? Early and strict social distancing was surely key, but experts also pointed to the early action of tech companies to shift to telework—and shared that the 49ers Super Bowl loss was a blessing in disguise, pre-empting victory parades and parties that would have been held just as the city saw its first COVID-19 cases. The full Grand Rounds episode runs over an hour, but the first half hour, featuring a one-on-one discussion between Wachter and Professor of Epidemiology Dr. George Rutherford, is must-see TV, covering the criteria needed to return to the “life we aspire to”. Rutherford thinks mass gatherings may be impossible for months, and that the general public might need masks until we have a vaccine. He argues for formal “supervised quarantine” measures, adding that workers may find it helpful to have a public health “doctor’s note” in seeking time off the job. And he stresses the importance and mechanics of “sentinel surveillance”. It’s refreshing and reassuring to watch the two experts clearly and calmly walking through complex data, coupling sobering guidance with inspiring success stories—Wachter and Rutherford bring Cronkite-like voices to the crisis. Bravo, UCSF!

Envisioning a healthcare surveillance state

A new piece from Axios provides a sharp and realistic vision of what a “post-lockdown” America might look like. Restrictions will not be lifted uniformly across the country; rather the path forward will be “slow and uneven” based on local rates of infection and availability of testing. The businesses we return to will feel different from before, only opening at partial capacity and still limiting the number of customers. Workplaces may stagger shifts to limit employees’ exposure. More waves of infection, and the resulting resumption of shutdowns, are all but certain. And experts acknowledge that most areas of the country are far from ready to begin the process, with testing and contact tracing far behind the levels needed for a safe reopening. Life is unlikely to fully return to normal until we have a vaccine.

As the mechanics of reopening are contemplated, attention has turned toward the prospect of digital surveillance as a means to track and isolate contacts to reduce spread of the virus.  A recent paper in Science discusses the mechanics and ethics of digital contact tracing. The authors posit that a digital tracing app, which builds a history of a person’s “proximity contacts” and immediately notifies them if a contact tests positive, could contain spread without the need for mass shutdowns. Digital surveillance has proven effective in South Korea and Singapore (where the government can ping the cell phone of an isolated patient, who then has three minutes to send a selfie confirming he’s where he should be).

Given that “test and trace” has proven highly effective in stopping spread, it’s easy to see the appeal of smartphone-enabled contact tracing. However, the idea raises a host of ethical and privacy concerns: will personal data truly be isolated and used only for immediate health purposes, or will all of this new data be too tempting for tech companies, law enforcement and others, who may be unable to resist using it for other purposes? Just today, Apple and Google announced an agreement to cooperate on contact tracing. By May, their operating systems will support contact tracing apps, with the ultimate goal of allowing tracing without a dedicated app—raising the question of whether the system will be truly “opt-in”. Lawmakers are beginning to raise privacy concerns and contemplate legislation, but these rapid developments make us wonder whether we will have a true “national conversation” about balancing disease tracking and civil liberties, or whether the next version of the “surveillance state” will come bundled in the next iOS update.


We’re happy to be shut of this awful week. There are better days ahead, as we’re reminded by April’s holidays. To those who celebrate, Happy Easter and Chag Pesach Samech, and to all of us, let’s stay focused on keeping each other healthy by staying home. Thank you for taking time to read our work, and for sharing your stories and suggestions with us. If you’d like, please share this with a friend or colleague and encourage them to subscribe, and to check out our daily podcast.

Most of all, please let us know if we can be of assistance in your important work. You’re making healthcare better—we want to help!

Best regards,

Chas Roades
Co-Founder and CEO
chas@gisthealthcare.com

Lisa Bielamowicz, MD
Co-Founder and President
lisa@gisthealthcare.com

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