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The Keckley Report

Health System Chief Strategy Officer Roundtable Assessment: ‘The Near-Term is Tough, the Long-Term is Uncertain and the Deck is Stacked against Hospitals’

By December 4, 2023No Comments

On November 2-3 in Austin, I moderated the 4th Annual CSO Roundtable* in which Chief Strategy/Growth Officers from 12 mid-size and large multi-hospital systems participated. The discussion centered on the future: the issues and challenges they facing their organizations TODAY and their plans for their NEAR TERM (3-5 years) and LONG-TERM (8-10 years) future. Augmenting the discussion, participants rated the likelihood and level of disruptive impact for 50 future state scenarios using the Future State Diagnostic Survey. *

Five themes emerged from this discussion:

1-Major change in the structure and financing of U.S. health system is unlikely

  • CSOs do not believe Medicare for All will replace the current system. They anticipate the existing public-private delivery system will continue with expanded government influence likely.
  • Public funding for the system remains problematic: private capital will play a larger role.
  • CSOs think it is unlikely the public health system will be fully integrated into the traditional delivery system (aka health + social services). Most hospital systems are expanding their outreach to public health programs in local markets as an element of their community benefits strategy.
  • CSOs recognize that states will play a bigger role in regulating the system vis a vis executive orders and referenda on popular issues. Price controls for hospitals and prescription drugs, restraints on hospital consolidation are strong possibilities.
  • Consensus: conditions for hospitals will not improve in the immediate and near-term. Strategies for growth must include all options.

2-Health costs, affordability and equitable access are major issues facing the health industry overall and hospitals particularly.

  • CSOs see equitable access as a compliance issue applicable to their workforce procurement and performance efforts and to their service delivery strategy i.e., locations, patient experiences, care planning.
  • CSOs see reputation risk in both areas if not appropriately addressed in their organizations.
  • CSOs do not share a consensus view of how affordability should be defined or measured.
  • There is consensus among CSOs that hospitals have suffered reputation damage as a result of inadequate price transparency and activist disinformation campaigns. Executive compensation, non-operating income, discrepancies in charity care and community benefits calculations and patient “sticker shock” are popular targets of criticism.
  • CSO think increased operating costs due to medical inflation, supply chain costs including prescription drugs, and labor have offset their efforts in cost reduction and utilization gains.
  • CSO’s are focusing more of their resources and time in support of acute clinical programs where streamlining clinical processes and utilization increases are achievable near-term.
  • Consensus: the current financing of the system, particularly hospitals, is a zero-sum game. A fundamental re-set is necessary.

3-The regulatory environment for all hospitals will be more challenging, especially for not-for-profit health systems.

  • Most CSOs think the federal regulatory environment is hostile toward hospitals. They expect 340B funding to be cut, a site neutral payment policy in some form implemented, price controls for hospital services in certain states, increased federal and state constraints on horizontal consolidation vis a vis the FTC and State Attorneys General, and unreasonable reimbursement from Medicare and other government program payers.
  • CSOs believe the challenges for large not-for-profit hospital systems are unique: most CSOs think not-for-profit hospitals will face tighter restrictions on their qualification for tax-exempt status and tighter accountability of their community benefits attestation. Most expect Congress and state officials to increase investigations about for-profit activities, partnerships with private equity, executive compensation and other issues brought to public attention.
  • CSOs think rural hospital closures will increase without significant federal action.
  • Consensus: the environment for all hospitals is problematic, especially large, not-for-profit multi-hospitals systems and independent rural facilities.

4-By contrast, the environment for large, national health insurers, major (publicly traded) private equity sponsors and national retailers is significantly more positive.

  • CSOs recognize that current monetary policy by the Fed coupled with tightening regulatory restraints for hospitals is advantageous for national disruptors. Scale and access to capital are strategic advantages enjoyed disproportionately by large for-profit operators in healthcare, especially health insurers and retail health.
  • CSOs believe publicly traded private equity sponsors will play a bigger role in healthcare delivery since they enjoy comparably fewer regulatory constraints/limitations, relative secrecy in their day-to-day operations and significant cash on hand from LPs.
  • CSOs think national health insurer vertical consolidation strategies will increase noting that all operate integrated medical groups, pharmacy benefits management companies, closed networks of non-traditional service providers (i.e. supplemental services like dentistry, home care, et al) and robust data management capabilities.
  • CSOs think national retailers will expand their primary care capabilities beyond traditional “office-based services” to capture market share and widen demand for health-related products and services
  • Consensus: national insurers, PE and national retailers will leverage their scale and the friendly regulatory environment they enjoy to advantage their shareholders and compete directly against hospital and medical groups.

5-The system-wide shift from volume to value will accelerate as employers and insurers drive lower reimbursement and increased risk sharing with hospitals and medical groups.

  • CSOs think the pursuit of value by payers is here to stay. However, they acknowledge the concept of value is unclear but they expect HHS to advance standards for defining and measuring value more consistently across provider and payer sectors.
  • CSOs think risk-sharing with payers is likely to increase as employers and commercial insurers align payment models with CMS’ alternative payment models: the use of bundled payments, accountable care organizations and capitation is expected to increase.
  • CSOs expect network performance and data management to be essential capabilities necessary to an organization’s navigation of the volume to value transition. CSOs want to rationalize their current acute capabilities by expanding their addressable market vis a vis referral management, diversification, centralization of core services, primary and preventive health expansion and aggressive cost management.
  • Consensus: successful participation in payer-sponsored value-based care initiatives will play a bigger role in health system strategy.

My take:

The role of Chief Strategy Officer in a multi-hospital system setting is multi-functional and unique to each organization. Some have responsibilities for M&A activity; some don’t. Some manage marketing, public relations and advocacy activity; others don’t. All depend heavily on market data for market surveillance and opportunity assessments. And all have frequent interaction with the CEO and Board, and all depend on data management capabilities to advance their recommendations about risk, growth and the future. That’s the job.

CSOs know that hospitals are at a crossroad, particularly not-for-profit system operators accountable to the communities they serve. In the 4Q Keckley Poll, 55% agreed that “the tax exemption given not-for-profit hospitals is justified by the community benefits they provide”  but 45% thought otherwise. They concede their competitive landscape is more complicated as core demand shifts to non-hospital settings and alternative treatments and self-care become obviate traditional claims-based forecasting. They see the bigger players getting bigger: last week’s announcements of the Cigna-Humana deal and expansion of the Ascension-LifePoint relationship cases in point. And they recognize that their reputations are under assault: the rift between Modern Healthcare and the AHA over the Merritt Research ’s charity care study (see Hospital section below) is the latest stimulant for not-for-profit detractors.

In 1937, prominent literary figures Laura Riding and Robert Graves penned a famous statement in an Epilogue Essay that’s especially applicable to hospitals today: “the future is not what it used to be.”

For CSO’s, figuring that out is both worrisome and energizing.

Paul

PS Today, Modern Healthcare releases its 2023 class of the 100 Most Influential People in Healthcare. Per MH, this year’s class includes 30 first-timers alongside the usuals—the policymakers and CEOs of the biggest and/or most prominent entities in healthcare. Notably, this year’s list includes 4 investors (Hemant Teneja General Catalyst #23, Brad Smith, Russell Street Ventures #56, Annie Lamont, Oak HC/FT #83, and Chris Gordon, Bain #99), 14 trade associations heads including some that campaigned for inclusion, a vendor (Press Ganey #79), an editor (SEIU #11, National Nurses United #67), the JAMA Editor and even Mark Cuban #13) for the Mark Cuban Cost-Plus Drug Co. It’s coveted recognition, actively sought and rightfully oriented toward the big names in industry and policymaking. And, as expected, it leaves out many deserving including influencers outside conventional circles and tech innovators like those developing platforms like ChatGPT, AI and Quantum Computing that will shape healthcare’s future more than most on the list.

PPS: If it happens, ageism will be on the ballot pitting Biden (81) vs.) Trump (77) in a rematch happens. Last week, we lost 3 other senior legends: Henry Kissinger (100), Sandra Day O’Conner (93) and Charlie Monger (99).  At some point, the health industry needs to consider its paternalistic and often condescending predisposition toward seniors. Many play significant roles in society well-after Medicare eligibility.

Exhibit: Opinions of Health System Chief Strategy Officers about the Likelihood and Disruptive Impact of *15 of the 50 Future State Scenarios scored by Roundtable (Scale 1-10 with 10 indicating strongest agreement with statement):

  3-5 Years   8-10 Years  
Future State Scenario

 

 Likelihood

Mean

 Disruption

Mean

 Likelihood

Mean

 Disruption

Mean
The U.S. health system will become a 2-tiered system: a private system and a public system. 1.7 6.9 5.7 7.7
Congress will impose price controls on the majority of hospital services. 2.9 7.5 5.4 7.6
Integrated health systems that operate hospitals, medical groups, post-acute & home care services and self-sponsored health insurance plans (payviders) will be the dominant structure in which care is provided and funded. 3.6 5.6 6.1 6.9
U.S. voters will approve a single-payer/Medicare for All system by 2033. NA NA 3.0 7.9
Competition in healthcare will be between regional, fully integrated systems of health sponsored by legacy insurers, health systems or retail health organizations. 3.8 7.0 5.1 6.8
The distinctions between for-profit and not-for-profit hospitals will significantly shrink in healthcare public policy. 3.8 5.5 6.4 5.5
Private equity ownership of hospitals and medical practices will be severely restricted 3.8 4.4 4.5 4.7
General acute hospitals will become public utilities. 2.3 6.8 3.9 7.0
Compensation for NFP hospital CEOs will be regulated. 2.5 5.5 4.6 5.4
Regulators (Department of Justice &/or Federal Trade Commission) will restrict vertical and horizontal consolidation of hospitals to reduce costs.

 

 5.1 6.3 5.8 6.0
The employer tax exemption will end by 2033.

 

 NA NA 5.8 6.5
Regulatory constraint will be applied to private equity ownership and operation of medical practices, hospitals and outpatient services.

 

 4.0 5.1 5.3 5.5
Private insurers will increase full-risk capitation as their major method of payment to providers.

 

 4.9 6.7 7.2 6.9
The majority of rural hospitals will close.

 

 3.3 6.8 6.4 7.6
The IRS will tighten its requirements for hospital tax exemption among not-for-profit hospitals.

 

 5.2 6.6 7.2 7.4

Note: Higher mean values reflect more agreement with the future state statement.  As a general rule, values below 4.0 reflects disagreement and values above 7.0 strong agreement.

Quotable

Re: Lumeris observation: “The dialogue observed with these senior executives was clear: Fee-For-Service is not the future. What also was clear is that what replaces this transactional model of payment is a concept around “value” though few define this in a consistent way. This ambiguity is not surprising given the transitory nature of the current healthcare marketplace as the demographics change, markets consolidate, regulatory policies and technologic changes rapidly reshape our world.”

John Fryer, Chief Revenue Officer, Lumeris shared his observations and takeaways from the roundtable jfryer@lumeris.com

Re: operating margin comparisons: “Health system operating margins are strikingly low, especially when compared to other industries. While both health system and health insurer, or payer, operating margins have declined in recent years, even some of the largest nonprofit health systems have negative margins (Figure 1). Health systems have seen operating margins decrease by 4.3 percentage points between 2018 and 2022 as compared to a 2.2 percentage point decline in payer margins. Meanwhile, the average life sciences operating margin has increased by 8.4 percentage points during the same time, averaging 10.2% year-over-year growth.”

Provider Competition: The Relationship Between Market Concentration, Price and Quality Trilliant Health December 3, 2023 www.trillianthealth.com

Re: the labor market: “Almost everyone agreed that the mid-2010s were a terrible time to be a worker…With the recovery from the global financial crisis of 2007-09 taking time, some 7% of the labour force in the OECD club of mostly rich countries lacked work. Wage growth was weak and income inequality seemed to be rising inexorably.

How things change. In the rich world, workers now face a golden age. As societies age, labour is becoming scarcer and better rewarded, especially manual work that is hard to replace with technology. Governments are spending big and running economies hot, supporting demands for higher wages, and are likely to continue to do so. Artificial intelligence (ai) is giving workers, particularly less skilled ones, a productivity boost, which could lead to higher wages, too. Some of these trends will reinforce the others: where labour is scarce, for instance, the use of tech is more likely to increase pay. The result will be a transformation in how labour markets work.”

“Welcome to a golden age for workers” The Economist November 28, 2023 https://www.economist.com/finance-and-economics/2023/11/28/welcome-to-a-golden-age-for-workers?

Re: primary care physician burnout:” Surprisingly, primary care physicians in the U.S. are in the middle of the pack when it comes to burnout. They report higher rates of satisfaction than their peers in the UK, Germany, Australia, New Zealand and Canada (but trail the Netherlands, Sweden, France and Switzerland in satisfaction).

If physician burnout isn’t a distinctly American phenomenon, deriving from unique aspects of the U.S. healthcare system, then what is causing doctor dissatisfaction around the world?

If the main drivers of burnout were indeed greedy insurance execs and a for-profit healthcare system, then you would expect that the Western nations with universal healthcare (which is paid for and provided by the government) would have dramatically lower physician burnout rates than in the United States.

If we look at the biggest change to global medical practice in the 21st century, it’s not the corporatization of care or the administrative burdens heaped on clinicians. It’s the evolution of illness, itself.”

Robert Pearl “Clinician burnout in the US: New data, surprising insights” November 27, 2023 https://www.linkedin.com/pulse/clinician-burnout-us-new-data-surprising-insights-robert-pearl-m-d–

Re: hospital survival strategy: “Another season of health insurance open enrollment is here and we are all about to experience another year of increased premiums. Experts predict painful – but unsurprising – premium increase of 6.4% in 2024 for employer-based plans and 6.0% for plans sold on individual exchanges.

Our nation’s hospitals continue to be a major driving force behind this perennial trend. But despite representing a significant portion of overall healthcare expenditures, our hospitals are struggling financially. Hospitals must evolve into something different; if they do not, they will face extinction.

Since 2019 alone, 167 hospitals in the United States have gone bankrupt and another 273 have merged into other organizations. Many of those shuttered hospitals were in rural areas or served lower income and minority populations.

Hospitals that are able to transform what they are and how they operate can survive and serve the public well. They will still require investments from society in the interim, but that investment will be justified by the public good and eventually represent a windfall to taxpayers…

Value-based care is the best policy we have to control costs. And its scope and impact are growing. Hospitals are therefore left without a viable choice: if they pursue value-based payment structures without embracing more comprehensive internal changes, they will trade dollars of utilization for cents in savings returns, harming their bottom line. If they reject value-based models, they will cede revenue to more efficient entrants, also harming their bottom line.

Gabriel Drapos “A New Deal for Hospitals” MedCity News November 28, 2023 www.medcitynews.com

Re: hospital financial performance: “Hospital performance in October reflects continued stabilization with margins above pandemic levels and volumes holding steady. The median Kaufman Hall Calendar Year-To-Date Operating Margin Index reflecting actual margins was 1.2% in October. Hospitals are continuing to experience financial stabilization and are increasingly adopting strategies to build resilience and minimize vulnerability. Key strategies include investing in technology, strengthening relationships with post-acute providers, expanding outpatient footprints, and deploying workforce optimization techniques.”

National Hospital Flash Report: November 2023 Kaufman Hall November 28, 2023 www.kaufmanhall.com

Re: ChatGPT, AI impact in healthcare: “Since the introduction of ChatGPT in late 2022, generative artificial intelligence (genAI) has elicited enormous enthusiasm and serious concerns.

History has shown that general purpose technologies often fail to deliver their promised benefits for many years (“the productivity paradox of information technology”). Health care has several attributes that make the successful deployment of new technologies even more difficult than in other industries; these have challenged prior efforts to implement AI and electronic health records. However, genAI has unique properties that may shorten the usual lag between implementation and productivity and/or quality gains in health care. Moreover, the health care ecosystem has evolved to make it more receptive to genAI, and many health care organizations are poised to implement the complementary innovations in culture, leadership, workforce, and workflow often needed for digital innovations to flourish.

The ability of genAI to rapidly improve and the capacity of organizations to implement complementary innovations that allow IT tools to reach their potential are more advanced than in the past; thus, genAI is capable of delivering meaningful improvements in health care more rapidly than was the case with previous technologies.”

Robert M. Wachter, Erik Brynjolfsson “Will Generative Artificial Intelligence Deliver on Its Promise in Health Care?” JAMA.  November 30, 2023. doi:10.1001/jama.2023.25054

Re: PE performance: “PE performance clawed its way back to double-digit territory in Q3. The top-seven US-listed alternative (alt) managers posted a median gross return of 11.5% for the trailing 12 months (TTM) ending Q3 2023. The median gross return for the quarter measured 2.6%, marking the fourth consecutive quarter of positive returns after a string of back-to-back negative quarters in 2022. While the 11.5% one-year return reported by PE firms still lagged the 21.6% of the S&P 500 during the same span, it was a welcome return to form for an asset class that powered the early growth of most of these managers, and it remains atop all strategies on a 10-year view…”

PitchBook’s Q3 2023 US Public PE and GP Deal Roundup is based on performance by the seven largest US-listed alt managers: Blackstone, KKR, Apollo Global Management, Blue Owl, The Carlyle Group, Ares Management, and TPG.  US Public PE and GP Deal Roundup November 29, 2023

Polling

KFF Poll: Medicaid enrollee satisfaction: This KFF brief is based on its Medicaid enrollees’ perspectives on their health insurance, based on findings from KFF’s Survey of Consumer Experiences with Health Insurance, fielded February 21 through March 14, 2023:

  • “Medicaid enrollees report worse health status compared to those with other coverage, which could lead to greater need for health care and more opportunities to encounter problems with the system. Still, the large majority (83%) of Medicaid enrollees rate the overall performance of Medicaid positively. However, over half of Medicaid enrollees report having experienced a problem in the past year, and relative to Medicare and employer-sponsored insurance (ESI), Medicaid enrollees are more likely to report certain negative outcomes from insurance problems.
  • Medicaid enrollees report fewer cost-related problems relative to those with Marketplace coverage and ESI; however, Medicaid enrollees report more problems with prior authorization and provider availability compared to people with other insurance types.
  • Across racial and ethnic groups, most enrollees rate their Medicaid coverage positively, with White Medicaid enrollees the most likely to describe their insurance as “excellent.” Similar shares of enrollees among all racial and ethnic groups report experiencing problems with their coverage. Similar to the experiences of people with other coverage, Medicaid enrollees who utilize more health care services experience more problems with their insurance.”

A Look at Navigating the Health Care System: Medicaid Consumer Perspectives KFF November 27, 2023 A Look at Navigating the Health Care System: Medicaid Consumer Perspectives | KFF

Pew Research Center: Opinions about AI: Per PRC’s survey conducted…

“What the data says about Americans’ views of artificial intelligence” Pew Research Center www.pewresearch.org

Physicians

Study: Preventive health in primary care: Based on a representative sample of 139,783 unweighted (5,902,144,258 weighted) US primary care visits covering 2001-2019:

The proportion of primary care visits with a preventive focus increased between 2001 and 2019 (12.8% of visits in 2001–02 versus 24.6% in 2018–19; with the greatest rate of increase seen for Medicare enrollees. “Primary care visits with a preventive focus involved more time spent with the physician and addressed fewer reasons for the visit compared with problem-based visits. At least one of the following was significantly more likely to occur during a preventive visit than a problem-based visit: counseling provision, ordering of preventive labs, or ordering of a preventive image or procedure. Our findings demonstrate a relative increase in preventive versus problem-based visits in primary care and suggest the importance of enhanced insurance coverage in influencing preventive care delivery trends”

Rotenstein et al Proportion Of Preventive Primary Care Visits Nearly Doubled, Especially Among Medicare Beneficiaries, 2001–19 Health Affairs https://doi.org/10.1377/hlthaff.2023.00270

Pharmacists (Therapeutics)

Study: pharmacist led blood pressure management: Context: Pharmacist-led interventions can significantly improve blood pressure (BP) control. The long-term cost-effectiveness of pharmacist-prescribing interventions implemented on a large scale in the US remains unclear.

Researchers compared the pharmacist-led care management regimen with a control group from 2009-2-13. Finding: “the pharmacist-prescribing intervention yielded 2100 fewer cases of CV disease and 8 fewer cases of kidney disease per 10 000 patients. The intervention was also associated with 0.34 additional life years and 0.62 additional QALYs. The cost savings were $10, 162 per person due to fewer CV events with the pharmacist-prescribing intervention, even after the cost of the visits and medication adjustments. The intervention continued to produce benefits in more conservative analyses despite increased costs as the ICER ranged from $2093 to $24 076. At the population level, a 50% intervention uptake was associated with a $1.137 trillion in cost savings and would save an estimated 30.2 million life years over 30 years.”

Dixon et al “Cost-Effectiveness of Pharmacist Prescribing for Managing Hypertension in the United States” November 3, 2023 JAMA Network Open. 2023;6(11):e2341408. doi:10.1001/jamanetworkopen.2023.41408

Study: Stem Cell treatment misinformation: UC Irvine researchers analyzed websites for 38 stem cell treatments. Findings:

“These companies operated or facilitated access to 60 clinics. More than 75% of these clinics were based in the United States and Mexico. 36 of the businesses marketed their stem cell and exosome products as treatments for Long COVID, 6 advertised them as ‘‘immune boosters,’’ 5 claimed to treat patients in the acute infection phase, and 2 claimed their products were preventive. The least expensive product cost $2,950, the most expensive was $25,000, and the average listed cost for patients was $11,322. The promotion of these products is concerning because they have not been approved by national regulators and do not appear to be supported by convincing safety and efficacy data.”

Turner et al “Businesses marketing purported stem cell treatments and exosome therapies for COVID-19: An analysis of direct-to-consumer online advertising claims” Stem Cell Reports November 14, 2023 http://creativecommons.org/licenses/by/4.0/.

Employers

Business Group on Health: Employer Issues: Rising health care costs, a sharper focus on prescription drug programs, and expanded access to mental health and substance use disorder services are among the nine health and well-being per “Trends to Watch in 2024” released by the Business Group on Health last Wednesday.

Rising Health Care Costs, Surging Prescription Drug Pricing, Acute Focus on Chronic Conditions Among 9 Trends to Watch in 2024, Says Business Group on Health | Business Group on Health (businessgrouphealth.org)

Hospitals

Modern Healthcare, AHA spar over study results:  Merritt Research analyzed charity care reported by 255 health systems for fiscal years 2020, 2021 and 2022 on behalf of Modern Healthcare:

“As nonprofit hospitals’ expenses rose during the COVID-19 pandemic, they provided proportionally less free or discounted care, also known as charity care. But the trend may shift as Medicaid beneficiaries lose coverage and as lawmakers ramp up pressure on providers.

Nonprofit hospitals’ median operating costs jumped roughly 20% from 2020 to 2022, according to a Modern Healthcare analysis of data from 255 health systems—comprising most U.S. nonprofit acute-care and specialty hospitals—compiled by Investortools-owned Merritt Research Services. The increase may explain, in part, why health systems’ median charity care as a percentage of operating expenses declined from 1.21% to 0.99% over that time period.”

In response, AHA General Counsel Melinda Hatton posted a scathing critique of the study: “A recent Modern Healthcare article misleadingly suggests that hospitals and health systems provided less charity care between 2020 and 2023. The truth is much different. In fact, the author’s own data tells a very different story, and it is important to set the record straight.

In reality, hospitals’ overall charity care increased over the last three years. According to the data cited in the article from Merritt Research Services, median charity care spending for all hospitals grew by 13% between 2021 and 2022 alone.

Hospitals’ expenses also increased during this period — at a far greater pace. The AHA has documented — again and again — how operating expenses have skyrocketed. Costs grew 17.5% between 2020 and 2022, driven by increases in labor expenses, drug costs, and spending on medical supplies and equipment. These expenses created historic financial headwinds, with record numbers of hospitals incurring negative operating margins. This massive growth in expenses has pushed many hospitals and health systems to the brink.

These twin realities contradict the article’s disingenuous headline, as well as its lead quotation from a professor whose research agenda has been funded by an anti-hospital dark money organization. Put simply, Modern Healthcare is able to break the entirely unremarkable news of a “proportional” decrease in the ratio of charity care and hospital expenses only because hospital expenses grew so precipitously… It is reckless and wrong to allege that hospitals are somehow deliberately “squeez(ing) their charity care spending to maintain financial viability” without presenting any evidence to back up this outrageous assertion. It is equally wrong for Modern Healthcare to offer that quote without reporting that the speaker is funded by Arnold Ventures — a shadowy organization with an obvious bias against hospitals.

The truth is that hospitals have been rocked by wave after wave of external financial challenges over the last three years, but that has not stopped them from providing critical care to the most vulnerable and needy patients and communities. This is the important news that Modern Healthcare should be reporting.”

Alex Kacik “As hospital expenses rise, charity care spending falls” Modern Healthcare November 27, 2023 Nonprofit hospital relative charity care down from 2020-2022 | Modern Healthcare

Melinda Hatton, General Counsel, American Hospital Association “Article Misleads on Hospitals’ Charity Care Spending” November 30, 2023 www.aha.org

Study: Hospital admissions during Covid: AHRQ researchers analyzed COVID-19 hospital admission rates in 3960 hospitals in 45 states associated with inpatient and intensive care unit (ICU) occupancy rates in 2020. Findings:

“Weekly COVID-19 admission rates in 2020 were less than 4 per 100 beds for 63.9% of hospital-weeks and at least 10 in only 15.9% of hospital-weeks. Inpatient occupancy decreased by 12.7% during weeks with low COVID-19 admission rates and increased by 7.9% during weeks with high COVID-19 admission rates. Intensive care unit occupancy rates increased by 67.8% during weeks with high COVID-19 admissions. Increases in ICU occupancy were greatest when weighted to reflect the experience of Hispanic patients. Changes in occupancy were most pronounced early in the pandemic. During weeks with high COVID-19 admissions, occupancy decreased for many service lines, with occupancy by surgical patients declining by 43.1% early in the pandemic.

These findings suggest that surges in COVID-19 strained ICUs and were associated with large decreases in the number of surgical patients. These occupancy fluctuations may have affected quality of care and hospital finances.”

Meille “COVID-19 Admission Rates and Changes in US Hospital Inpatient and Intensive Care Unit Occupancy” JAMA Health Forum December 1, 2023;4(12):e234206. doi:10.1001/jamahealthforum.2023.4206

Study: hospital screening for social needs: The Harvard-UCSF researchers analyzed changes in hospital screening for patient health related social needs (HRSN). Findings:

“This 2021 national survey demonstrated that more than three-fourths of acute care hospitals reported screening for all 5 CMS priority HRSNs, substantially higher than a prior 2017-2018 estimate of 24.4%. While fewer than half of hospitals reported having screening and interventions to address all 5 CMS priority HRSNs, findings suggest that VBP participation was associated with HRSN program adoption, potentially because these models provide the flexibility to use funds to develop, scale, and sustain such programs.”

Sandhu et al “Hospital Characteristics Associated With Social Needs Activities in the US” JAMA November 30, 2023. doi:10.1001/jama.2023.20358

Regulator Reports released last week:

Suicides: The number of suicides in the United States hit a record high in 2022 of 49,449 (14.3/1000) –3% higher than 2021. CDC www.cdc.gov

Life expectancy: Life expectancy in the U.S. rose by 1.1 year in 2022 — the first increase since the pandemic began. Increases were in every racial and ethnic group and remains over a year lower in 2019. The pandemic drove 84% of the increase. Note: the gap in life expectancy between men and women widened to about 6 years in 2021—an increase from the low of roughly 4.8 years in 2010: overall, in 2021, women had an average life expectancy of 79.3 years and men had an average life expectancy of 73.5 years. National Center for Health Statistics: www.cdc.gov/nchs

Corporate Profits: total corporate profits in the third quarter grew 3.3% to an annualized rate of $3.28 trillion– shy of the all-time peak of $3.3 trillion reached in Q3 2022. U.S. Bureau of Economic Analysis: www.bea.gov