Healthcare Delivery Post-Pandemic

WITHOUT QUESTION, the COVID-19 pandemic caused by the SARS-CoV-2 novel virus has resulted in severe financial stress on the healthcare system. During the first several months of the pandemic, facilities were closed except for emergency room visits, in-person management of chronic and life-critical treatments and, of course, patients who were infected with the virus. Indeed, the industry ground to a halt, laying off workers and postponing elective procedures and routine patient care. In fact, the American Hospital Association estimated in a four month window from March 2020 to June 2020, hospital systems in the U.S. saw more than $200 billion in losses, leading the Congressional Budget Office to project between 40 percent and 50 percent of hospitals could have negative margins by 2025.¹ “It has been a major disruption to the healthcare system,” says Ann Greiner, president and CEO of the Primary Care Collaborative (PCC), a not-for-profit multi-stakeholder membership organization dedicated to advancing an effective and efficient health system.

But with disruption comes tremendous learning opportunities for how to better prepare for future challenges. These lessons, including expanding telehealth services, rethinking where care is provided and, potentially, dramatically changing payment systems, have the potential to create a more nimble and responsive healthcare system.

How Healthcare Is Provided

Although the capability of telehealth services has been growing for years, its use has played second fiddle to in-person provider visits since their inception. That is, until the COVID-19 pandemic struck. Stymied by challenges from payers, restrictions for practicing medicine across state lines, technology infrastructure and mindset, it wasn’t until the pandemic nearly shut down the healthcare industry save for essential services that the opportunities telehealth could afford were realized, and that sent providers scrambling to put systems into place. In fact, it is estimated that during the pandemic, telehealth services have increased by 50 percent over their use in 2019.² And the U.S. Department of Health and Human Services has responded with a pledge of $15 million to support telehealth services through the duration of the pandemic.³

While telehealth services have technically been reimbursable since 1997, geographic restrictions to meet stringent reimbursement criteria mostly prohibited their use. These restrictions required a patient to live far from a service provider, and visits had to take place outside of a patient’s home. But the pandemic exposed the urgent need for telehealth, resulting in the Centers for Medicare and Medicaid Services’ (CMS) temporary removal of the bureaucratic telehealth reimbursement restrictions, which paved the way for adopters (both providers and patients) to utilize these services. More touchpoints such as telephone and webcam were also enabled, and barriers to care, including transportation and time constraints, were removed. Yet transitioning to telehealth has not been without its unique challenges such as investment in technology, access to high-speed Internet and patients who have difficulty accessing virtual care.

Now, months into the pandemic with increased telehealth use, practices are financially and emotionally stressed with nearly 70 percent reporting they are not ready for reduced or terminated payments for telehealth visits once an end to the national emergency is declared. Fewer than 50 percent of practices report having enough cash on hand to stay open, over one-third have laid off or furloughed staff and 53 percent report patients are not scheduling well visits or chronic care visits despite their availability.⁴

As such, pressure on Congress to continue funding telehealth services and to make permanent changes to the healthcare system is mounting. Even so, use of telehealth services may take some convincing, according to PCC. While more than 70 percent of primary care patients surveyed are comfortable using telehealth during the COVID-19 pandemic, most prefer to return to in-person care when they are able,⁵ particularly depending on the type of care sought.

Nevertheless, the technology behind telehealth is advancing, including demands for artificial intelligence (AI) to bring realtime telephone triage consultation services. Additionally, AI can serve emergency rooms, doctor offices, healthcare research and other services through quicker diagnostics that result in faster and potentially more accurate decision-making and care. Questions remain, though, on the regulatory, insurance and usability fronts for how to capture, submit and utilize remote monitoring of patient health data.

Without a doubt, the trajectory of telehealth opportunity will continue to rise, but there will be important considerations about which services best lend themselves to virtual care and how those services can best be provided. And, as telehealth grows, there is likely to be increased demand for more flexibility in provider licensing by practice region and skillset⁶ as the geographic barrier of proximity to care is removed.

Healthcare Facilities Reenvisioned

The Institute of Medicine (IOM) estimates 44.5 percent of all financial waste in U.S. healthcare comes from inefficient care delivery and unnecessary services.⁷ Couple that with the immense financial challenges presented by the pandemic and the urgency to find lasting solutions to improve healthcare, delivery at an affordable cost has never been more greatly needed. In this environment, reenvisioned care access points may be a long-term outcome from this pandemic. This is particularly so while it is determined whether hospitals or clinics are the best place for patients to receive care and rural areas struggle with the high cost of maintaining facilities and the challenges of providing specialty care.

Federal waivers (such as section 1135 [available whenever the president declares a national disaster or emergency] that were used in combination with section 1332 of the Affordable Care Act and section 1115 of the Medicaid Families First Coronavirus Response Act) have paved the way for a more nimble state response to the COVID-19 crisis, and now the pursuit of federally based statutory authority for program waivers is also being encouraged. When considered along with other determinants of health such as social services, housing, nutritional support, etc., there is now conversation about where healthcare is best provided.

One solution in discussion, and in some cases in practice, is the formation of outpatient urgent care centers that can serve a larger number of patients, including those receiving telehealth services, which would enable hospitals to focus attention on critical care services, resources and expertise. These centers — alternatives for patients who would otherwise seek care in the emergency room — could consolidate and improve care through better utilization of resources, increased patient volume and lowered costs.

Consolidated care offers the potential benefit of consolidating critical supplies, thus easing operational costs such as purchasing, staffing and storage, as well as facilitating smoother supply and demand through one or a few central locations. In addition, a healthcare hub model may offer rural locations with miles separating thinly stretched resources, equipment and specialist efficiencies. However, PCC’s Greiner cautions these efficiencies don’t necessarily equal lowered costs, particularly in regard to primary care.

Additionally, community-based facilities such as workplaces, schools, community and other nonhospital settings provide opportunities for conveniently located supportive care such as nutritional, mind-body and support group services. Making health support more easily accessible by bringing it to the patient could ensure better access to information and support for patients’ all-around health. Supportive care services could also be added to the menu of hospital-based offerings, enabling a more holistic approach for both patients and providers.⁸

The Business of Healthcare

Any discussion about the future of healthcare must consider providers and payers. During the pandemic, CMS began offering advance payments to providers based on lump-sum collection estimates for care instead of fee-for-service payments, which have been the norm. And many private insurers followed suit, which is welcome news for an industry struggling for years with rising insurance costs and confusing reimbursement policies.

The notion of moving away from fee-for-service payments, which some argue incentivizes volume and discourages telehealth services since they are historically reimbursed at a lower rate, has been percolating for some time. This is especially the case since primary care is at the forefront of helping to keep patients healthy and out of hospitals. “Primary care fee-for-service doesn’t work well in a pandemic,” says Greiner.

Many advocates are calling for lump-sum payments per patient under their care payable by CMS, pointing to the success of some commercial Medicare Advantage programs that already operate under a lump sum reimbursement model that results in better patient outcomes at a lower cost.⁹

A huge challenge to healthcare is the number of uninsured that has only been growing along with the increasing unemployment rate caused by the pandemic. Although Congress passed legislation covering the cost of COVID-19 testing and treatment, the long-term ramifications of the economy and nation’s health are likely to significantly and perhaps permanently affect the healthcare industry.

Of course, there are many challenges to overcoming the historically slow cogs of lasting change. Insurance, multiple federal oversight agencies, and state and federal legislation all will have an impact. From staffing shortages to increasing costs, the challenges sometimes seem to be moving in opposition. Yet, there are glimmers of hope as the industry evolves and adapts, favoring telehealth over traditional brick and mortar in a global pandemic. And the significance of any future change may be directly proportional to the length of time it takes to get an approved COVID-19 vaccine.

One thing is certain, if all parties come to the table with honest discussion and respectful debate, whatever model of healthcare emerges from this crisis has the potential to serve the collective whole — one that addresses the immensity of health disparities, captures the capabilities of technological advances and supports the resilience of the tireless healthcare workers. Opportunity for change is knocking at the healthcare industry’s door. However difficult in the short-term, opening the door to embrace change may be the only long-term viable solution.