The Weekly Gist: The Vaccine, Vaccine Edition

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

“The cavalry is on the way”

This week brought the strongest evidence yet that there is light at the end of the tunnel in the COVID pandemic. Today, drugmaker Pfizer and its biotech partner BioNTech filed an application with the US Food and Drug Administration (FDA) for an Emergency Use Authorization (EUA) for their jointly-developed COVID vaccine, after Phase III clinical trials in nearly 44,000 patients showed it to be safe, and 95 percent effective, in preventing infection. With biotech firm Moderna announcing that their vaccine trial showed similar results, with an EUA filing shortly to follow, we are now on track for early distribution of a vaccine to high-risk groups by the end of next month. According to Secretary of Health and Human Services (HHS) Alex Azar, 40M vaccine doses will be available by the end of December. Much attention will now turn to the complex logistical challenge of distributing the vaccine nationwide. Meanwhile, a new study (which has yet to be subjected to peer review) indicated that once developed, immunity to the coronavirus might last for years—making the prospect of a safe and effective vaccine all the more promising in the battle against COVID.

As Americans prepare to celebrate Thanksgiving, the hard work of dedicated scientists and researchers has given us much to be thankful for. But this will be a very different Thanksgiving, celebrated under difficult circumstances. With the US passing the grim milestone of a quarter million lives lost to COVID, over 80,000 patients hospitalized with the disease, and daily counts of new cases averaging more than 154,000 this week—40 percent higher than the previous week—the Centers for Disease Control and Prevention (CDC) urged Americans to stay home for Thanksgiving, spending the holiday only with members of their immediate households. According to HHS data obtained by The Atlantic, 22 percent of hospitals expect to experience staffing shortages as the third wave of the pandemic intensifies, and a composite forecast from the CDC projects that over the next three weeks the COVID death toll could reach 298,000. With vaccines on the way, the “dark winter” ahead (as President-elect Biden describes it) will require continued resolve and vigilance. As Dr. Fauci said yesterday in the first White House COVID press briefing since July, “If you’re fighting a battle, and the cavalry is on the way, you don’t stop shooting. You keep going until the cavalry gets here.” Keep going.

Amazon takes another big step into healthcare

In a move first telegraphed by its billion-dollar acquisition of online pharmacy PillPack in 2018, Amazon announced the launch of Amazon Pharmacy, putting the online giant in head-to-head competition with retail pharmacies CVS and Walgreens, and its big-box nemesis Walmart. The new service will give customers access to home delivery of prescription medications, in addition to free delivery and a new drug discount card for members of Amazon Prime. Customers can have their physicians send prescriptions directly to Amazon Pharmacy and use their insurance to pay for the drugs, or they can choose to pay Amazon’s cash prices, which in many cases will be less expensive than insurance-based prices. Rather than fully disrupt the traditional pharmacy business model, Amazon has partnered with pharmacy benefit manager (PBM) Evernorth (a subsidiary of Cigna) for drug discounts, and with AmerisourceBergen as a drug supplier. Nevertheless, the new offering will surely shake up the mail-order pharmacy segment, which has been declining in recent years as brick-and-mortar retailers have expanded their in-person clinic offerings, often tied to in-store pharmacies. Given changes in consumer shopping patterns caused by COVID, Amazon may have chosen a propitious moment to try to move its customers—especially its loyal Prime members—to a mail-order model that offers the “frictionless” convenience of the broader Amazon service approach.

Also behind the timing of Amazon’s pharmacy launch may have been the recent success of drug discounter GoodRx, which recently went public with a massive valuation based on the profitability of its business, and has been engaged in an aggressive marketing push. Amazon’s announcement of a competing discount card for Amazon Prime members, with up to 80 percent off the price of generic drugs and 40 percent off for branded medications, poses a significant threat to GoodRx. Amazon’s installed base of more than 125M Prime users dwarfs the nearly 5M customers who use GoodRx, and over time its scale should attract partnerships with other PBMs beyond Cigna’s, allowing it to offer the same or better savings to Prime members. Users of Amazon’s new benefit card will be able to purchase drugs through Amazon Pharmacy, as well as at over 50,000 brick-and-mortar pharmacies including CVS, Walmart, Walgreens, and Rite Aid, without using their insurance. While this week’s launch is not as immediately disruptive to incumbents as some had feared, it will surely allow Amazon to broaden its foothold in healthcare, and to explore new avenues to leverage its massive online presence as it moves further into the $3.6T healthcare industry. Expect (much) more to come.

The AMA declares racism a public health threat

On Monday, the American Medical Association (AMA) voted to recognize racism as an “urgent threat to public health”. At its annual meeting, the organization’s House of Delegates voted to take actions to confront systemic, cultural and interpersonal racism, including acknowledging harm and bias in medical research and healthcare delivery, funding research to identify risks of racial bias to health, and encouraging medical schools to teach students about the causes and effects of racism, and strategies to prevent adverse health outcomes. The resolution was one of several proposed items aimed at addressing racial diversity and equity in medical education and care delivery. Over the past two years, the AMA has been moving toward a more progressive stance on health and social policy; in June the AMA Board of Trustees also pledged action against racism and police brutality in response to the murder of George Floyd. A generational divide between older and younger doctors was also apparent during last year’s debates on Medicare for All, when the organization narrowly voted to maintain its opposition to single-payer healthcare in a close vote that would have been unimaginable a decade ago. At this week’s meeting, however, the group gave its stamp of approval to proposals for a more limited “public option” coverage expansion. As more young physicians enter the field of medicine, we’d expect the AMA to become a stronger voice on a range of social and policy issues. 

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

Comparing pandemic intervention strategies

As we navigate the greatest health crisis of our lifetimes, it turns out that many aspects of our experiences in 2020 aren’t as “unprecedented” as we may think. The widely varied pandemic responses by local and state officials (and resulting political polarization) occurring today also transpired over 100 years ago during the Spanish Flu. Lessons from a century ago may be worth revisiting: the left side of the graphic below details the health and economic case for public health mitigation strategies. Cities that enacted “longer interventions” (including mask mandates, closures, business capacity restrictions, and social distancing measures) in 1918 experienced fewer deaths per capita, as well as higher employment gains through 1919, compared to “similar” cities that enacted “shorter interventions.” For example, Los Angeles, which declared a state of emergency and banned all public gatherings early in the pandemic, had 25 percent fewer deaths per capita, and a 27 percentage-point greater gain in subsequent employment than San Francisco, which mainly focused on urging residents to wear masks in public.

Fast forward to today, when we’re also seeing significant differences between COVID containment policies at the state level. The right side of the graphic shows that states with the weakest overall pandemic containment policies are currently experiencing the worst outbreaks, measured here by hospitalizations per capita. States like Hawaii and New York, which maintained many of the strict mitigation strategies first put into place in the spring, are seeing those restrictions pay off with fewer hospitalizations during the latest spike. Conversely, Iowa and the Dakotas have fewer, and less stringent, public health measures, and are now seeing the highest surges in the country today. (New Mexico shows that state-level policy decisions don’t explain everything—it’s currently battling a serious outbreak despite maintaining some of the strongest containment measures over the course of the pandemic.) As we head into the worst COVID wave so far, the debate over whether saving “lives” or “livelihoods” should dominate the pandemic response rages on. History shows that higher levels of public health intervention can both save lives and result in stronger economic recovery.

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

Striving to maintain normal operations in the third wave

In talking to our health system members from across the country in the past few weeks, we’ve heard that the COVID surge is happening everywhere. Nearly everyone we’ve talked to has told us that their inpatient census of COVID patients is as high or higher now than during the initial wave of the pandemic in March and April. And nearly everyone is expecting it to get much worse over the next few weeks, as hospitalizations increase in the wake of the explosion of cases we’re seeing now. But there is something striking in our conversations in comparison to eight months ago: no one seems to be panicking. Crisis management processes that were developed and honed early in the pandemic are proving very helpful now. Normal patient care services are continuing despite the uptick in COVID volume, and protections are in place to keep the care environment segregated and COVID-free as possible.

While dozens of health systems, many in the hardest hit states in the Midwest and Great Plains, have announced plans to curtail elective care during this third wave, the decisions are based on individual hospital capacity and staffing, instead of being mandated by states. Having largely worked through the “COVID backlog” across the summer and early fall, system leaders want to avoid canceling surgeries again, and few are expecting state governments to force them to. Many of our members have drawn up plans for selective cancellations depending on capacity, but we’re not likely to see sweeping shutdowns again—unless the workforce becomes so overstretched that it impacts operations. That’s good news, and will likely lead to less interrupted patient care. And it’s good news for hospitals’ and doctors’ economic survival, as many would not be able to absorb the body blow of another widespread shutdown. Fingers crossed.

Who do I call to get in line for the vaccine?

We’ve heard from a couple of health systems that the phone calls have started: “I’ve got diabetes, so I’m high risk. Is there a list I can get on for the COVID vaccine?” With news reports trumpeting not only the effectiveness of the vaccines, but also that hospitals will play a key role in delivery, patients have started contacting their local health systems looking for details on how and when they can get it. Weeks before the first doses arrive, health systems are recognizing the need for a public communication plan, for both the community and their physicians, as even more patients are surely asking their doctors the same questions. Early in the pandemic, independent physicians were hungry for regular communication from local health systems on local pandemic response, and the status of PPE and testing resources; now, regular messaging on vaccine status and access will be a critical resource for local doctors. Given worries about vaccine hesitancy, eager patients are a great thing. People trust doctors, nurses and hospitals more than any other source of health information. Proactive and consistent communication directly from providers is essential if we’re to meet the nation’s immunization goals—and get our lives closer to normal by next Thanksgiving.

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 Sean Lane, CEO of healthcare artificial intelligence company Olive AI. The company helps healthcare providers automate repetitive, often error-prone processes like claims processing and prior authorizations. Lane compared the artificial intelligence transformation going on in healthcare to the introduction of ATMs in the banking industry.

On Monday, November 30th, we’ll talk with Mike Flammini, Senior Vice President at Privia Health. Privia has recently been striking new partnerships with health systems, with the goal of creating a new model for physician alignment. Make sure to tune in, you won’t want to miss it!

Note to listeners: Our podcast will be on holiday hiatus next week. Alex wishes everyone a safe and happy Thanksgiving holiday!

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Give this a spin—you might like it.

Looks like we’re going to be stuck inside for a little while longer—alas. On the bright side, that means more time to discover new music! Rather than focus on one artist this week, we thought we’d share some of the online music streams that have been keeping us company for the past few months, beyond our usual crate-digging in Spotify and Apple Music, or the ubiquitous algorithm of Pandora. Key criteria: eclectic selections, thoughtful (human) programming, and reliable service. Take a listen—and let us know where you go to discover great music:

• KEXP—Venerable Seattle-based public radio station and perennial tastemaker for alternative and indie music and beyond.
• WFMU—The longest-running freeform radio station in the US, with a gargantuan variety of oddball shows, streaming from East Orange, NJ.
• FIP—A Paris-based service of Radio France, with cleverly curated music ranging from chansons to classical to rock.
• NTS Radio—London-based underground streamer, serving up a variety of hour-long shows that live up to its name, “Nuts to Soup” (and back again).
• Soho Radio—Live broadcasts from the alt-heart of London, featuring a rotation of musicians, club DJs, artists, and other culture mavens.
• WorldwideFM—24/7 streams from cutting-edge DJs around the globe, with an emphasis on bringing indigenous music to a world audience.
• BBC 6 Music—The Beeb’s digital-only channel, dedicated to alternative music old and new, with a killer lineup of luminary presenters.

We said it, they quoted it.

“Doctors Are Calling It Quits Under Stress of the Pandemic”
New York Times; November 15, 2020

“But, depending on the future course of the pandemic, Dr. Lisa Bielamowicz, a co-founder of Gist Healthcare, a consulting firm, predicts ‘another wave of financial stress hitting practices.’ Many doctors’ groups will seek a buyer, whether a hospital, an insurance company or a private equity firm that plans to roll up practices into a larger business.”

Stuff we read this week that made us think.

Listen to the nurses

As New York City prepares for an anticipated second surge COVID admissions, officials and health system executives there are optimistic that hospitals won’t be as overwhelmed as they were in the spring. According to a recent Wall Street Journal article, now-standard COVID treatment protocols have lightened the need for critical care beds: only 20 percent of hospitalized patients today are admitted to the ICU, compared to 35 percent in April. Availability of testing and PPE supplies has markedly improved. But the lingering fear is staffing. During the first surge, New York hospitals relied heavily on traveling nurses. But with COVID hospitalizations spiking nationwide, demand for contract nurses has surged, and the supply line may not be there this time. Embedded in the article—and well worth ten minutes of your time—is a video that follows four “COVID crisis nurses” as they chase virus surges from New York and New Jersey in the spring, on to Arizona and Texas during the summer’s Sunbelt spike. In their own voices, they tell of caring for critically ill and dying COVID patients (some of whom still deny having the disease in their last breath), of leaving the hospital to see the communities around them ignoring COVID precautions, and of the lasting emotional and physical toll it has taken on them. As we plan for the coming holiday season, all of us should listen to their stories—and be thankful for the sacrifices that doctors, nurses and other providers continue to make as they care for patients.

Have we hit “peak Lysol” yet?

The last time we checked, our local grocery store shelves were still out of antibacterial wipes. That’s still the story nationwide, according to this fascinating Bloomberg profile by the brilliant healthcare journalist Drew Armstrong, about America’s most in-demand disinfectant and the company that makes it: eight months into the pandemic, we still can’t get enough Lysol. Invented in 1889, Lysol still relies on the same two disinfecting chemicals, ethanol alcohol and a quaternary ammonium compound, or “quat”. Lysol has been marketed for a variety of purposes over the years, some more dubious than others. (From the 1920s through 1950s, it was marketed to women as a douching and contraceptive agent, according to Smithsonian Magazine.) The proprietary blend of ethanol and quat turns out to be highly effective in killing the coronavirus on surfaces. The piece provides a detailed look at how Lysol overcame its dis-integrated, “just-in-time” supply chain to triple its pre-COVID production. Lysol began testing pandemic demand back in March, sending 10,000 cans to a single Florida store. They sold out in less than two hours. Even with 35M cans produced per month, stores are still regularly selling out today. Where will demand settle? Lysol is betting that increased demand will persist even after the crisis has passed, as our heightened cleaning habits will become ingrained—yet another way that society may be permanently shaped by the COVID pandemic.

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

Best wishes for a safe and enjoyable Thanksgiving,

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

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