As a third wave of COVID-19 broke across the country, setting new infection and death records, Penn’s Leonard Davis Institute of Health Economics (LDI) convened a virtual seminar of top experts late last month to discuss the extraordinary financial impact the pandemic is having across all of health care delivery.
The panelists were a CEO of one of the country’s largest academic medical centers, the former Louisiana State secretary of health, vice president of government affairs at the California Primary Care Association, and the former U.S. Department of Health and Human Services national coordinator for health information technology.
Panel moderator and LDI executive director Rachel Werner set the scene. “Data to date show the pandemic has taken a tremendous financial toll on our health care system, affecting health care delivery in profound ways. Included are a decline in visits and clinical activities, and consequent reductions in revenues and health care workforce. Here in Philadelphia, earlier this month, one of the major health systems, Jefferson Health, announced it was eliminating 500 jobs after a drop in patient cash flow last spring of around a billion dollars. For many in health care, there is a sense of economic peril and a concern about how to preserve the financial integrity of our health system as we move forward.”
“The hospital sector took a giant hit,” said panelist Kevin Mahoney, chief executive officer of the University of Pennsylvania Health System. “In early March we shut down elective visits and surgery,” said Mahoney, who is also an LDI senior fellow. “We had an acceleration of expenses. I still have $400,000 worth of ventilators that we bought because there was a belief that everyone was going to end up on a ventilator. Then we found out the mechanical ventilation actually prolonged the patient stay, so we quickly pivoted.”
“The pandemic saw an acceleration of trends and laid bare how dependent hospitals are on commercially insured elective procedures and how, without them, we don’t make money,” Mahoney continued. “We need to use this as a clarion call to reset and move forward on value initiatives.”
The other panelists agreed the surprisingly rapid move to telemedicine care across all of health care helped shore up many providers’ financial stability during the crisis. But they were of different minds about how telecommunications might be taken forward in the payment systems in the post-COVID period.
Read more at Penn LDI.