COVID-19 Isn’t only Killing People
Hospitals are dying too
47 It’s a number we hear far less than the more than 13 million cases and 260,000 deaths so far. It’s the number of hospitals that have closed or filed for bankruptcy so far this year. We’re well aware that America is no role model for pandemic response. The nation’s hospital system represents tireless and resilient heroes pressing through a time of great difficulty. Unfourtanetly, the healthcare system’s response also represents flagrant policy failures and procrastinatory habits that are literally killing us.
Many hospitals, especially rural ones, were struggling before the pandemic even began, but COVID-19 was the straw the broke the camel’s back. Well, actually the novel coronavirus has been more like a 10-ton bundle of straw that killed the camel. Our healthcare system is in complete disarray.
While conspiracy theorists and even public officials enjoyed scoring political points from accusing frontline health workers of disregarding their Hippocratic oath, hospitals were and continue to be sinking in a sea of financial despair. The American Hospital Association estimates that hospitals will lose more than $323 billion dollars by the end of 2020 due to the pandemic.
Doomed from the start
The fact of the matter is, US hospitals were doomed from the beginning. Early missteps at the federal level put hospitals and the people that they serve in grave danger. For one, the CDC was slow to get test kits out and when they did, they were faulty. If that wasn’t bad enough, an odd thorn of bureaucratic code began to rear its ugly head restricting the ability of the academic community and private sector to develop testing equipment. The testing fiasco made room for a deadly, asymptomatic infectious disease to spread without testing or contract tracing for weeks. Even once COVID-19 testing became available, there was still a vastly limited supply.
One hospital administrator reported having only one ventilator and one respiratory therapist in their entire hospital.
The impact of having a never seen before, infectious disease raging with limited testing equipment had an unprecedented impact on hospitals. A March 2020 report from the Office of the Inspector General for HHS painted a very grim picture. Hospitals were forced to keep symptomatic patients for as long as seven days to await results. Extended visits drained hospital staff, resources, and equipment. It also put healthcare workers at risk. More than 250,000 cases and 1,700 deaths have been among healthcare workers. As patients piled up in unprecedented numbers with unusually long stays, staffing continued to grow razor thin. Especially those with the expertise to handle infectious diseases or respiratory illnesses. In the same HHS report, one hospital administrator reported having only one ventilator and one respiratory therapist in their entire hospital.
Bleeding money
Ventilator shortages were a common theme of the first coronavirus wave in the U.S. However, we didn’t have as much discussion about the skyrocketing medical equipment prices hospitals had to face. A report from the Society of Healthcare Procurement Professionals noted several significant price increases for critical PPE and other equipment critical to mitigate a pandemic and protect medical workers. 3ply masks and isolations gowns both went up by more than 1500%.
If all that wasn’t enough stress on US medical systems, many hospitals had to cut out significant revenue-generating activity from elective procedures. In fact, the “cancellation of elective procedures results in deficits of $16.3 to $17.8 billion per month in revenue and $4 to $5.4 billion per month in net income to the US hospital system.”
This is no conspiracy
Aren’t hospitals making a killing getting $13,000 per patient? No, hospitals are still getting killed.
Limited staffing, unprecedented numbers of patients, and billions of dollars of lost revenue. But I know what some are thinking, what about all of the money from COVID-19 patients? Aren’t hospitals making a killing getting $13,000 per patient? No, hospitals are still getting killed.
Let me explain the $13,000 number people throw around. Hospitals currently receive a weight-based payment from the federal government for Medicare patients. This system, known as the Acute Care Hospital Inpatient Prospective Payment System, depends on the disease, hospital population, and other factors. Under the Cares Act, congress authorized a 20% payment add-on which the Kaiser Family Foundation estimated to be $13,297 for patients with less severe hospitalizations. In other words, there is no official blanket amount that every hospital receives per patient.
Furthermore, congress wrote the 20% add-on because hospitals were struggling financially due to the pandemic, not to make them rich. If the objective were to make hospitals rich, it wouldn’t be through medicare. “Medicare and Medicaid pay less than the cost of caring for program beneficiaries.” Even before the pandemic hit, reportedly 63.9% of hospitals lose money on Medicare. What’s the moral of the story? COVID-19 related Medicare cost payments aren’t making hospitals rich.
Even if Medicare payments were profitable for hospitals, let’s not forget that millions of people have lost their health insurance in the midst of the pandemic which has significantly contributed to the amount of “uncompensated care costs.”
Any way you spin it, US hospitals are in trouble.
Any way you spin it, US hospitals are in trouble. In the midst of the current wave, there are 150,000 cases per day hospital capacity is becoming increasingly troublesome. With no end in sight to the pandemic and hospital stress continuing, it’s time we have a conversation about making some significant changes to our healthcare system. Shifts that will prevent the spread of infectious diseases, protect healthcare works, and treat patients efficiently, without forcing hospitals to close doors. If we don’t make changes now, the next pandemic or even wave will.
