Hospitals, health care sector reel from COVID-19 damage

Hospitals, health care sector reel from COVID-19 damage

Hospitals, health care sector reel from COVID-19 damage

The global coronavirus pandemic has created a huge need for health care in the U.S., but it also is delivering a devastating financial blow to that sector.

COVID-19 worries have kept patients away from doctors’ offices and forced the postponement and cancellation of non-urgent surgeries. The pandemic also has shut down large portions of the American economy, leaving many would-be patients without insurance or in a financial pinch that makes them curb spending.

All of this has forced hospitals, health systems and doctors to lay off staff, cut costs and hope a return to normal arrives soon.

“You couldn’t ask for a worse situation, really,” said Joe Antos, an economist with the American Enterprise Institute.

Health care provided the biggest drag on the U.S. economy in the first quarter. Spending on care fell at an annual rate of 18%, the largest drop for that sector among records going back to 1959.

Economists point to hospital systems, a key driver of the sector’s performance, as a big reason behind the drag from COVID-19, which initially hit some parts of the sector more intensely than others.

The nation’s largest hospital chain, HCA Healthcare, said its hospital-based outpatient surgery totals for last month were down about 70% through late April.

In many cases, hospitals that lose those profitable surgeries are gaining COVID-19 patients — and losing money on them. Those patients may require hospitals to expand intensive care units, spend more on infection control and stock up on gowns and masks, among other items.

The American Hospital Association estimated in a recent report that the nation’s hospitals and health systems will collectively lose more than $36 billion from March to June treating hospitalized COVID-19 patients.

When adding factors like lost revenue from postponed surgeries, the total balloons to more than $200 billion, said the association. Congress has set aside about $175 billion so far to help hospitals and other care providers, but the hospital association says more assistance is needed.

“We’re facing perhaps the biggest financial crisis in our history,” association CEO and president Rick Pollack said.

From the doctor’s office, the view also is bleak.

Dr. Seemal Desai said patient visits for his Dallas-area dermatology practice plunged about 85% after COVID-19 hit.

He started seeing patients over the internet with help from smartphone or tablet cameras. But that created fresh problems. Desai said some patients don’t have the technology to do online visits. Others hesitate because they aren’t sure their insurance will cover them.

Only about half the patients who were offered a telemedicine visit actually did one.

“You would think my volume would be shooting through the roof and people would be clamouring for it, but it’s completely the opposite,” Desai said.

The dermatologist cut expenses, including marketing, and he’s reduced some employee hours.

Nationally, the health care sector shed nearly 1.5 million jobs from February to April, or about 9% of its total, according to the federal Bureau of Labor Statistics.

A big chunk of that came from dentist offices. Preliminary data shows that employee totals for that slice of the sector sank by more than 500,000, or 53%.

Overall economic growth, as measured by the gross domestic product, fell at an annual rate of 4.8% in the January-March quarter even though the severe impact of the virus was only felt in the last couple of weeks of March.

The current quarter is expected to be much worse. The Congressional Budget Office forecasts that the GDP will plunge 40%. That would be four times the largest drop on quarterly GDP records that go back to 1947.

Even so, health care researchers expect hospitals, doctor’s offices and surgery centres to rebound gradually. But they’re not sure yet how much patient volume will return.

People who have lost jobs and insurance coverage may not make doctor visits unless they absolutely have to.

The Kaiser Family Foundation recently estimated that nearly 27 million people — or about 8 per cent of the U.S. population — could have become uninsured at least temporarily between March and early May due to the loss of employer-sponsored insurance.

It also may take a while for some patients to become confident that a hospital or doctor’s office is safe enough to visit without catching COVID-19.

“People are just afraid to go to any medical setting right now,” Antos said, noting that the economy also could face another setback if infection rates spike again.

In Texas, Dr. Desai has pulled chairs out of his waiting rooms to increase social distancing for patients and staff. He’s also asking other patients to wait in their cars until the exam room has been sanitized.

The dermatologist got some government assistance in the first round of payroll protection loans, and that will help him for a few more weeks.

But he’s not expecting a quick rebound. It’s hard to rebuild patient volume when only two people can be in the waiting room at the same time.

“After another month I honestly have no clue whether we will be able to remain open,” he said.

___

AP writers Martin Crutsinger, Josh Boak, Andrew Taylor and Linda A. Johnson and senior video journalist John Mone contributed to this report.

_____

Follow Tom Murphy on Twitter: @thpmurphy

Tom Murphy, The Associated Press

Coronavirus

Get local stories you won't find anywhere else right to your inbox.
Sign up here

Just Posted

File photo
Alberta’s central zone has 670 active cases

301 new cases identified Sunday

Alberta has 1,910 active cases of COVID-19 as of Wednesday. Red Deer is reporting five active cases, with 108 recovered. (File photo)
Red Deer reports 25th COVID-19 death

415 new cases identified provincially Saturday

Alberta Health reported two new COVID-19 deaths in Red Deer Friday. (Image courtesy CDC)
Two more deaths linked to Olymel outbreak in Red Deer

Province reported 356 additional COVID-19 cases Friday

Black Press file photo
Wetaskiwin RCMP execute search warrant; illegal drugs seized

Two Wetaskiwin residents have been charged with possession and trafficking of Methamphetamine.

Alberta Premier Jason Kenney speaks during a news conference in Edmonton on Feb. 24, 2020. It’s budget day in the province, and Kenney’s United Conservative government is promising more help in the fight against COVID, but more red ink on the bottom line. THE CANADIAN PRESS/Jason Franson
Alberta’s budget promises more help for COVID-19 with a hard deficit

Annual spending on debt interest is closing in on $3 billion

A cross-country skier glides along the banks of the Ottawa River in Ottawa on Thursday, Feb. 25, 2021. Canadians across the country can look forward to a mild spring peppered with the odd winter flashback throughout the first part of the season, according to predictions from one prominent national forecaster. THE CANADIAN PRESS/Sean Kilpatrick
Mild spring with some wintry blasts predicted for most of Canada: Weather Network

Weather Network is forecasting a slower than average start to spring in British Columbia

AstraZeneca’s vaccines are ready for use at the vaccination center in Apolda, Germany, Sunday, Feb.28, 2021. (Michael Reichel/dpa via AP)
Feds hoping for AstraZeneca shots this week as Pfizer-BioNTech prepare next delivery

The first of those doses could start to arrive in Canada as early as Wednesday

People line up outside a vaccine clinic as seniors wait to get the COVID-19 vaccine in Edmonton Alta, on Friday February 26, 2021. THE CANADIAN PRESS/Jason Franson
Alberta Health Services head sorry for glitches in vaccine booking system for seniors

AHS president said technical issues have been fixed and a virtual waiting room is in place

Vandalism is shown on Alberta NDP MLA Janis Irwin’s constituency office in Edmonton in this handout photo on Saturday, February 27, 2021. Alberta Premier Jason Kenney quickly condemned vandalism at an Opposition legislature member Janis Irwin’s Edmonton office after the MLA posted pictures showing her front window spray-painted with the words “Antifa Liar.” THE CANADIAN PRESS/HO, Janis Irwin *MANDATORY CREDIT*
Alberta Premier slams vandalism after slur painted on MLA’s office window

Edmonton MLA Janis Irwin posted pictures showing the front window spray-painted with the words ‘Antifa Liar’

A helicopter flies past a mountain near McBride, B.C., on Saturday January 30, 2016. THE CANADIAN PRESS/Darryl Dyck
Avalanche warning for backcountry users in North and South Rockies

Avalanche Canada is urging backcountry users to always check their regional avalanche forecasts

Supporters pray outside court in Stony Plain, Alta., on Wednesday, Feb. 24, 2021, as a trial date was set for Pastor James Coates of GraceLife Church. He is charged with holding Sunday services in violation of Alberta’s COVID-19 rules and with breaking conditions of his bail release. THE CANADIAN PRESS/Jason Franson
Trial date for jailed Alberta pastor charged with breaking COVID-19 health orders

The court says it will reconvene with lawyers on March 5 for a case management plan by teleconference

A pharmacist prepares a COVID-19 vaccine at Village Green Retirement Campus in Federal Way on Jan. 26. (Olivia Sullivan/Sound Publishing)
Canada approves use of AstraZeneca’s COVID-19 vaccine

The country joins more than a dozen others in giving the shot the green light

Most Read