Resizing U.S. Healthcare: A Potential Silver Liner for COVID-19


The coronavirus crisis has taken its toll on the lives of Americans and the economy. But the fear of the coronavirus has changed the cost-benefit analysis of medical services in ways that can be potentially positive for the future of healthcare in the United States.

Everyone in healthcare is talking about putting patients first. But there has never been a context in which patients have been forced to take the initiative in determining which health services are worth the collateral risks.

Since January, U.S. medical personnel have earned the gratitude of the country by battling the health crisis of coronavirus infectious diseases (COVID-19). Instead of a positive net margin, healthcare systems ironically expect to lose a total of $ 202.6 billion in revenue between March 1 and June 30, while medical staff have been laid off and put on duty. leave in unprecedented numbers.

Patients have disappeared en masse from the health care system even as hospitals have waved patients back now that the worst of the crisis is over. Patients have shown that they believe the benefits of certain categories of medical services are simply not worth the collateral risk of COVID-19. Patients may be wrong to overestimate the extent of the risk of COVID-19 versus the benefits of health services. But this paradigm shift has created a market metric for understanding what medical services patients see as truly “essential” and a perspective on what should be the “right size” for our massive US healthcare system.

The government and private insurers have sought to contain costs and mitigate moral hazard by capping reimbursements to health systems and imposing co-payments and deductibles on patients. This top-down approach has failed to contain U.S. healthcare costs, which account for 18% of our GDP and have exceeded the rate of economic growth for decades. Medical systems often bypass reimbursement limits by inducing physicians and other healthcare providers to engage in excessive preventative medicine and elective procedures that mitigate patient risks and liability issues. Respecting the sea of ​​government bureaucracy means the staff outnumber the 16 to 1 doctors, most of whom have no interaction with patients but massively inflate healthcare costs.

Financial deductibles, co-payments and value-based health care have failed to dampen the enthusiasm of patients and health systems to spend “whatever it takes” to identify and solve problems. potential health.

The coronavirus outbreak has changed the equation for medical systems and patients by forcing both to consider the uneconomic costs of healthcare. The crisis inadvertently introduced the ‘COVID copay’, which transformed the demand for medical services. Between March 1 and April 15, hospitals saw a 56% drop in the number of patients. Relative to the volume of healthcare in January, inpatient admissions fell 30%, emergency room visits fell 40%, and day surgery procedures fell 70%. This has left a huge hole in hospital budgets across the country and raised the question of how much of the potential overconsumption of healthcare resources takes place on a regular basis. In the short term, this change has been devastating for hospitals, causing massive losses and layoffs. In the long term, healthcare policymakers should apply lessons learned from the coronavirus response.

The full extent of the COVID-19 co-pay is just starting to unfold as a metric to assess the health services that patients really value. As states reopen their savings, hospitals are clamoring to recoup lost revenue by asking patients to return. The question is how patients will react when they consider the risk of exposure to COVID-19 when deciding which health services they value.

This bottom-up approach is obviously far from definitive in determining what tests and procedures are really necessary. But this represents a significant market measure for considering what consumers value as necessary care. Some patients may delay legitimately needed medical attention, which could lead to more serious or life-threatening conditions. However, the fear factor of COVID-19 will change the cost-benefit analysis of patients for the foreseeable future, as patients will oppose medical recommendations they perceive to be unnecessary.

Discussions of healthcare reform have almost always focused on top-down incentives imposed by the federal government, insurers and healthcare systems. Yet this crisis for the first time brought the broader costs of seeking medical care to the fore in the minds of patients. As tragic as this outbreak has been, we must apply the lessons of this experience to determine priorities for the post-COVID-19 healthcare landscape and not waste the opportunity to adapt US healthcare.

Dr. Kim-Lien Nguyen is an Assistant Professor of Medicine at UCLA’s David Geffen School of Medicine and a practicing cardiologist.


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