July 24, 2020

The Weekly Gist: The Socially Distanced Pitch Edition

by Chas Roades and Lisa Bielamowicz MD

It was a sight for sore eyes. (No, not Dr. Fauci’s…um…socially distanced first pitch. But at least we know he’s serious about not wanting anyone to catch anything.) Just after 7pm, Washington Nationals ace Max Scherzer wound up and tossed a fastball to the New York Yankees’ Aaron Hicks, and finally—finally!—baseball was back. Never mind that the coronavirus had other ideas, with Nats slugger Juan Soto ruled out just before the game with a positive COVID test, and never mind Mother Nature making her own unwelcome appearance with a thunderstorm that shortened the game to six innings. Even the Bronx Bombers’ win couldn’t spoil the night—the boys of summer are back! It’s a welcome return, and it comes not a moment too soon, a needed distraction from the headlines of the day. We’re going to savor every minute of it.

THIS WEEK IN HEALTHCARE

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

Grim statistics mount in the battle with COVID

It was a week of unhappy milestones in the nation’s battle with the coronavirus. On Thursday, the US crossed the threshold of 4M confirmed COVID cases, just 15 days after it hit the 3M cases mark. That’s three times as fast as it took to go from 2M to 3M cases, with daily new case counts now hovering near 70,000. As the virus proliferates across the country, California has now overtaken New York as the epicenter of the outbreak, with more than 422,000 total cases reported since the beginning of the pandemic, versus New York’s 413,000. Of greater concern, the daily US death toll from COVID stayed stubbornly above 1,000 for most of the week, the highest it’s been since late MayMore Americans are currently hospitalized with COVID than at any time since the middle of April, with the Gulf Coast states showing some of the highest per-capita hospitalization rates in the country. For good reason, Secretary of Health and Human Services (HHS) Alex Azar officially renewed the Trump administration’s declaration of a public health emergency for another 90 days, clearing the way for the nation’s hospitals to receive more emergency financial assistance in battling the virus, and for continued relaxation of regulations that have allowed them to provide care virtually, and in non-traditional settings.

Meanwhile, as part of its Operation Warp Speed initiative to accelerate the development of a COVID vaccine, the Trump administration inked a $1.95B deal with pharmaceutical firm Pfizer and a German biotech company, BioNTech, to purchase 100M doses of the vaccine those companies are developing, with an option to buy an additional 500M doses. That’s in addition to contracts already in place to purchase 100M doses of a vaccine from Novavax, and 300M doses from AstraZeneca. Americans would have free access to the Pfizer vaccine under the new arrangement, with the government subsidizing the entire cost of each dose, estimated to be about $19.50. Similar deals struck by the British government with AstraZeneca and GlaxoSmithKline carry a much lower per dose price tag—between $4 and $10—raising concerns of “profiteering” by pharmaceutical companies in the US vaccine hunt. The forward purchasing of millions of doses, coupled with rapid progress on vaccine development (at least 25 of the 150 potential vaccines being developed are already in human trials), raises hopes that help is on the way in our battle with the virus. On Friday, however, top White House science advisor Dr. Anthony Fauci said that he doesn’t expect a vaccine to be “widely available” to the American public until the second half of next year. Until then, our hand-to-hand combat with the virus—using non-pharmaceutical interventions such as mask wearing, social distancing, hand hygiene, testing, and contact tracing—must intensify, particularly in light of increasingly worrisome data on the spread and impact of the disease. US coronavirus update: 4.0M cases; 144K deaths; 48.8M tests conducted.

The parlous state of COVID data reporting

On Monday, the Department of Health and Human Services (HHS) launched its new coronavirus data tracking dashboard, HHS Protect. Following last week’s short-notice decision to order hospitals to stop reporting COVID statistics to the Centers for Disease Control and Prevention (CDC) and instead to use a new HHS tool (developed by private contractor TeleTracking), hospitals were left scrambling to retool their reporting processes. At launch, there were significant issues with the accuracy of the HHS Protect data—for example, as of today, the dashboard lists California’s overall inpatient bed occupancy rate at 97 percent, and Rhode Island’s at 118 percent. Not only has the reporting change created a significant additional burden for hospitals—one executive told us that the process was “far from automated” and that they were being asked to collect numerous additional pieces of data that required them to pull staff away from other duties—other public health entities that previously relied on the CDC’s existing data reports were caught short as well. The state of California, for example, had to add a disclaimer to its statewide COVID dashboard, noting that numerous facilities were not yet able to provide data because of the HHS switch.

Meanwhile, a new study from Resolve to Save Lives, a nonprofit organization led by former CDC director Dr. Tom Frieden, provided a dismal evaluation of the quality of COVID data reporting across the country. According to the study, only 40 percent of essential data points are being regularly reported, while more than half of critical indicators are not being reported at all. In particular, the study called out reporting on testing turnaround time and contact tracing activities as key areas in need of improvement. As with many aspects of the pandemic, data reporting has become a political issue—with some states intentionally withholding data from the public that could provide a much clearer picture of progress in combatting the virus. This latest dust-up between the CDC and HHS on data collection and reporting adds an unhelpful challenge, and comes at a time when we need more reliable intelligence on the pandemic, not more reasons to doubt the (limited) information that’s available.

HCA reports its “COVID quarter” earnings—they’re up

The nation’s largest hospital chain, HCA Healthcare, announced its second quarter earnings this week, giving Wall Street a closer look at how disruptions from COVID have impacted the financial health of the sector. The headline-grabbing news: compared to the same quarter last year, HCA’s earnings were up nearly 38 percent, hitting $1.08B for the period. More than half of HCA’s quarterly profits, or $590M, came from CARES Act funding distributed as part of a Congressional bailout of the industry. In total, the chain received about $1.4B in CARES Act funding in the second quarter, about two-thirds of which was from the federal government’s “general” distribution—based on Medicare billings or total revenue—with the rest from funds targeted to particularly hard-hit facilities. (HCA has also received $4.4B in advance Medicare payments, according to the earnings report.) Similar to what we’ve heard from several not-for-profit systems, the CARES Act money largely rescued what otherwise would have been a disastrous “COVID quarter”: HCA’s same-facility admissions were down 12.8 percent compared to the second quarter of last year, with inpatient surgeries down 15.7 percent, hospital outpatient surgeries down 27 percent, and ambulatory surgeries down 40 percent. While that loss in business—driven by the shutdown of non-emergent cases in most states, and consumers’ reluctance to return to healthcare settings—drove a 12.2 percent reduction in revenue, avoidance of associated costs allowed HCA to reduce expenses by 10.5 percent compared to last year’s second quarter.

The real question for HCA—and for all hospitals trying to recover from the first wave of COVID while bracing for further spikes and resurgence—is how much of the “backlog” of postponed cases will eventually return, and what volume will look like after the backlog is gone. In a call with analysts, HCA’s CEO Sam Hazen estimated that the chain has managed to “recapture” 40 to 50 percent of deferred cases, which have now either been performed or rescheduled. He reported that orthopedic procedures, spine surgeries, and general surgery have recovered fastest, with diagnostic visits lagging. As we’ve talked to hospital executives across the country, the general expectation seems to be that post-backlog volumes will eventually settle at between 85 and 90 percent of pre-COVID levels, but (because of payer and case mix shifts) with only 70 to 75 percent of pre-COVID revenue. As helpful as CARES Act funding has been thus far, there’s a new economic reality coming for hospitals—one that will require a much broader rethink of the volume-and-visits-driven financial model that most have come to rely on.


GRAPHIC OF THE WEEK

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

Increasing unemployment alters national payer mix

One in every five workers is now collecting unemployment benefits as the country struggles to get the COVID-19 outbreak under control. A recent Families USA study estimates a quarter of the 21.9M workers that were furloughed or laid off between February and May lost their health insurance. And the payer mix will continue to change as the pandemic wears on. The graphic below highlights a study from consultancy Oliver Wyman, looking at the impact of rising unemployment (at 15, 20 and 30 percent) on insurance coverage. With each five to ten percent rise in unemployment, the commercially insured population decreases by three to five percentThose who lose employer-sponsored insurance either remain uninsured, buy coverage on the Obamacare marketplaces, or qualify for Medicaid. Surprisingly, Washington State and California are reporting little to no enrollment growth in Medicaid programs thus far. Experts point to lack of outreach and consumer awareness as key contributors to the slow growth—but Medicaid enrollment will likely begin to rise quickly in coming months as temporary furloughs convert to more permanent layoffs.

The right side of the graphic spotlights the growing number of uninsured individuals in those states with the highest uninsured rates. The previous record for the largest increase in uninsured adults was between 2008 and 2009, when nearly 4M lost coverage. The current pandemic-driven increase has crushed that record by 39 percent. On average, states are seeing uninsured populations increase by two percent, with some as high as five percent. And the two states with the highest uninsured rates, Florida and Texas, are also dealing with the largest surge in COVID-19 cases and deaths. The ranks of the uninsured will continue to climb as states reimpose shutdowns, government assistance ends, and layoffs grow.


THIS WEEK AT GIST—ON THE ROAD PHONE

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

COVID care as a model for care redesign

We got an update from the chief medical information officer of one of our member systems about their ongoing progress in expanding telemedicine. Their rate of virtual visits peaked in late April, accounting for over half of all physician encounters. But like most systems, they’ve seen telemedicine visits drop to less than 20 percent of all appointments as physician offices have reopened. In thinking about how the system will move telemedicine forward, she said, “We’re trying to be intentional and really design a top-notch consumer experience, with quality as the foundation.” They are going specialty-by-specialty, condition-by-condition, to redesign care pathways to optimally blend virtual and in-person care. It’s daunting, but she believes COVID-19 provided a model for how to do this quickly and effectively. In just a few weeks, many systems stood up COVID management programs in the following way: algorithm-driven, online symptom triage triggers a virtual visit with a doctor. Testing is conducted at new, dedicated locations, to keep doctors’ offices as COVID-free as possible. Patients with concerning symptoms are monitored at home with pulse oximetry and regular check-ins; the same resources are used to ensure discharged patients are recovering well. It’s the perfect example of how to design a safe, consumer-centered care pathway, using the whole of a health system’s resources. Now the challenge facing doctors and hospitals is: can this process be scaled across the hundreds of conditions that could benefit from a blend of virtual and traditional care?  

“We’ve jumped past burnout to anger”

Last week we wrote about an observation from some physician leaders that, paradoxically, physician burnout seemed to have waned a bit during the COVID crisis. They felt that, as clinicians rallied to provide care for patients during the pandemic, many found new purpose in the work, despite great challenges. Bureaucratic hurdles yielded to the need to make critical decisions quickly, as did regulatory barriers to telemedicine. The piece sparked a number of doctors, most from regions now experiencing surges, to share their alternative viewpoints with us. One employed physician wrote that, across specialties, he and his colleagues are angry. They don’t feel protected, either financially, or even for their own physical safety. A nurse practitioner working long shifts in an emergency department overloaded with COVID patients wrote, “In April, I would have never believed that we would be scrounging for PPE at the end of July. How could this happen?” And a nephrologist redeployed to a COVID ICU shared: “With the surge in New York, it felt like the entire country was behind their doctors and nurses. I drive home past restaurants and stores filled with people refusing to wear masks. It’s so demoralizing.”

Several expressed that their employers, both health systems and payers, are “counting on our goodwill that we’ll just keep showing up.” But once the crisis passes, there may be “drastic and irrational physician revolts. Someone should be watching for it.” These comments reveal a marked difference in physician sentiment in different parts of the country, based both on the severity of the pandemic, and the nature of the local response.  Regardless, we’d agree that the clinical workforce, both doctors and nurses, is working through a period of unprecedented stress, and for some, emotional trauma. Ensuring their stability and safety must be a top priority for every health system and medical group.


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 talked with Torben Nielsen, CEO of Zoom+Care. He shared his surprise that a third of the patients who sought out phone, chat and video visits from the urgent care chain, with clinics in the Pacific Northwest, weren’t in markets where Zoom has its physical clinics. Nielsen said that may help Zoom+Care gauge where to open future clinics.

Next Monday we’ll hear from Dr. Rahul Rajkumar, Chief Medical Officer of Blue Cross Blue Shield of North Carolina, about the insurer’s new efforts to shore up independent primary care practices with more predictable payments. And we’ll also hear from a participating primary care doctor in Charlotte, who’s looking forward to getting paid for the care he’s already providing. 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.

One of the most powerful musical responses to the murder of George Floyd came back in June: “Pig Feet” was a stirring protest song from hip hop producer and saxophonist Terrace Martin. Featuring rapper Denzel Curry, and saxophone great Kamasi Washington, it was a visceral reaction to the shocking police brutality that kicked off this summer of unrest. Martin and Washington are back this month as part of the new soul-jazz supergroup Dinner Party, along with Houston pianist Robert Glasper, and North Carolina hip hop producer 9th Wonder. Their eponymous debut album showcases a different kind of response to current events, one more in the tradition of Marvin Gaye’s legendary What’s Going On? Where the explosive video for “Pig Feet” opens with the message that “The video to this song is happening right outside your window,” this album strikes a mellower, more reflective tone. As Glasper told the Los Angeles Times, “It’s a protest album but also not, you can listen to it and not feel like you’re watching the news.” Not that the message is any less sharp: on the album’s featured single, soulful guest vocalist Phoelix (who appears on four of the seven tracks) sings “They told me put my hands up behind my head/I think they got the wrong one/I’m sick and tired of runnin’”. Another track called “First Responder” is dedicated to Breonna Taylor. But the album’s mood is more suited to, well, a dinner party among old friends, even though the news might still be playing in the background. It’s great to see these titans of the new jazz scene collaborating on a new project—here’s hoping that we’re invited to future dinner parties hosted by this incredible lineup. Best tracks: “Freeze Tag”; “Sleepless Nights”; “First Responders”.


WHAT WE’RE READING

Stuff we read this week that made us think.

Could COVID-19 precautions could lighten the flu season?

Measures to slow the spread of COVID-19, like masks, social distancing and handwashing, appear to be preventing transmission of other respiratory viruses, according to a Wall Street Journal report. Public health officials in Australia, Chile, South Africa and other countries in the Southern Hemisphere are reporting much less severe flu seasons. One doctor in New Zealand reported that the number of influenza patients at his clinic near Auckland dropped by 90 percent compared to last winter. Australia reported just 85 confirmed flu cases for the last two weeks of June, compared to over 22,000 in the same two-week period last year. Experts believe lockdowns, travel restrictions and greater immunization rates in many Southern Hemisphere countries account for a large portion of the decline in influenza and other respiratory viruses; closures of schools and daycares may have also contributed. With shorter, more lax shutdowns, and lower adoption of mask wearing in the US, we may not see the same benefit. But as health officials sound warnings about a convergence of seasonal flu and another COVID spike this fall and winter, this (admittedly early) data provides some optimism. We’re not sure why anyone is still resistant to wearing a mask, but here’s yet another reason to be diligent.

Black children are over three times more likely to die after surgery

study published this week in Pediatrics revealed a shocking disparity in surgical outcomes between Black and white children. Using a national surgery quality database, researchers compared the post-procedure outcomes of over 100,000 Black and white children who were healthy prior to undergoing surgery, finding that Black children were 3.4 times more likely to die in the 30-day post-operative period compared to their white peers. Black children had 18 percent higher odds of developing a post-operative complication, and a 7 percent greater chance of an adverse event. The authors note that they didn’t compare potential associated factors like the facilities in which care was delivered, or socioeconomic factors, and they stress that the study illustrates correlation, not causation. But the findings show undeniable evidence that, despite decades of improvement in surgical outcomes, significant racial disparities persist for a population of patients for whom adverse outcomes are relatively rare. The authors suggest that more detailed reporting, including data on race and insurance status, are critical to be able to dig deeper into important questions of whether patients of different races get equivalent care in hospitals.

Well-documented and pervasive racial disparities exist across many areas of healthcare (maternal outcomeschronic disease, and now COVID-19, just to name a few). A combination of social, economic, medical and policy solutions are needed to close these gaps. But even basic diagnosis may fall short for Black Americans. (See the recent work of a medical student to catalogue how common skin conditions look on dark skin—a valuable resource that just didn’t exist before.) Given the under-representation of minorities in clinical trials, medicine likely also needs to return to its fundamentals, to ensure that our methods of diagnosing and treating patients are equally effective across racial and ethnic groups.


That’s it for this week! Thanks for taking the time to read the Weekly Gist, and for sending along your feedback and suggestions. We always love hearing from you—drop us a line! And if you have a moment, please share this with a friend or colleague and encourage them to subscribe, and to listen to our daily podcast.

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

Best regards,

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

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