|THIS WEEK IN HEALTHCARE
What happened in healthcare this week—and what we think about it.
America celebrates a grim milestone
As the nation headed into the 4th of July weekend, the number of new COVID cases hit a string of daily highs, reaching a record high of more than 55,000 on Thursday. States across the South and Sunbelt, especially those that lifted stay-at-home orders early, saw the worst spikes. Florida broke a new record with more than 10,000 cases on Thursday, and Georgia also experienced a new daily high. Hospitalizations continued to rise sharply in several states as well. Many hospitals reported a shift in COVID admissions toward younger, otherwise healthy adults, reports borne out by the lower death rate than that experienced in the initial surge of cases in the Northeast. (Advances in the management of severely ill COVID patients have also brought death rates down.)
In a Senate hearing on Tuesday, top White House health advisor Dr. Anthony Fauci said that the US was “not in total control” of the pandemic, and predicted that daily new case counts could top 100,000 if more stringent measures are not taken. California, Florida, and other states took steps to roll back reopening efforts, and Texas Gov. Greg Abbott abruptly reversed direction and ordered a statewide mask mandate. Welcome news, but likely too late to prevent cities like Houston from exceeding available ICU capacity. Cases in the city have skyrocketed across the past month, with its positive test rate hitting 20 percent yesterday; its cancer and children’s hospitals began admitting COVID-positive adults to provide added capacity. With celebrations scheduled across the nation this weekend, including another large event today at Mount Rushmore to be attended by President Trump, where masking and social distancing will be optional, it seems certain that we will continue to reap the whirlwind of careless behavior and hasty reopening for the rest of this month and beyond. And looming in just six weeks—students return to schools and colleges. US coronavirus update: 2.7M cases; 130K deaths; 33.5M tests conducted.
HHS to extend COVID-19 public health emergency
With COVID cases surging in many parts of the country, the Department of Health and Human Services (HHS) announced via tweet this week that it intends to extend the COVID-19 public health emergency for 90 days beyond its current July 25th expiration date. The American Hospital Association and other provider groups have been urging HHS to renew the emergency—for the second time—as it undergirds several important payment policies and regulatory changes currently in place. These include waivers of telehealth restrictions, a 20 percent boost to Medicare reimbursement for COVID patients, requirements that insurers cover COVID testing without cost-sharing, and increased federal Medicaid matching rates. (Importantly, some of the other key changes made to help healthcare providers during the pandemic, like the ability to deliver care in alternative settings and temporarily enroll out-of-state providers, are in place due to the separate Stafford Act national emergency declaration.)
The longer these temporary HHS policies remain in place, the harder it will be to roll them back—particularly those that are consumer-facing, like telehealth. HHS is likely assessing which telehealth changes should remain in place after the national emergency ends from both a cost-savings perspective and as a result of growing pressure from patients, providers, and telemedicine vendors. Case in point: CMS proposed a rule last week that would permanently loosen restrictions on home health providers’ use of telehealth. Health systems and physicians should plan their COVID-era virtual care investments with an eye toward longer-term platform development and integration—whether or not HHS ultimately makes emergency changes permanent. In our view, delivering care virtually will prove critical for building consumer loyalty well beyond the pandemic.
Another red state votes to expand Medicaid
Voters in Oklahoma narrowly approved a ballot measure that will require the state to expand Medicaid as part of the Affordable Care Act (ACA), making it the first state to expand the program since the beginning of the coronavirus pandemic. By a razor-thin margin of 50.5 percent to 49.5 percent—just 6,488 votes separated the two sides—Oklahoma became the fifth “red state” to approve Medicaid expansion by ballot measure, joining Idaho, Nebraska, Maine, and Utah. State Question 802, as the ballot measure was known, requires the state to expand eligibility for Medicaid by July 1, 2021 to include uninsured adults that earn up to 138 percent of the federal poverty level. About 200,000 additional Oklahomans will be covered by the program, at a cost of about $164M to the state—a 25 percent increase in coverage for only 2.7 percent more money than the state currently spends on Medicaid. That leverage is thanks to the 90-10 split in funding for the expansion population between the federal and state governments under the ACA, which critics argue will shift over time as the federal budget deficit grows. Ironically, despite the fact that the “Yes on 802” campaign was largely framed as an initiative to save rural healthcare, 70 of the state’s 77 counties opposed the expansion, with voters in Oklahoma City and Tulsa providing the votes needed for the win. Whatever the politics of Medicaid expansion, the vote comes at a time when Oklahoma’s unemployment rate is 12.6 percent, and the state is experiencing a significant spike in COVID cases and hospitalizations. The “yes” vote will be welcome news for the state’s low-income residents, who are disproportionately impacted by the virus.