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My First Blog Post

What is this blog, who should read it and what will you get?

Be yourself; Everyone else is already taken.

— Oscar Wilde.

This is the first post on my new blog. I’m just getting this new blog going, so stay tuned for more. Subscribe below to get notified when I post new updates.

What is this blog about?

I cover important current national and state-level issues in health care – particularly health care policy and health care law. Because of the nature of the topics I cover, they are at the intersection of health care and politics.

Why is this blog important?

Unfortunately, sources of information about these important issues are often biased, come with a particular political point of view or are written or sponsored by industry interests. Of course, I have biases of my own, but I also have the ability to present an issue objectively and discuss the pros and cons of all sides of the issue so that readers can make an educated opinion on the issue for themselves. I believe that if you give readers balanced and complete information, they will be able to engage in the discussion productively and come to well-informed opinions and solutions.

Of course, there are few issues in health care that I do not have an opinion about, and there are many who, because of my background and experience, want to know how I come out on a particular issue. I will share those opinions with you on the blog, but I will be clear and explicit with you when I am expressing my own view. You can then take it for what its worth.

Who is this blog for?

Really, any one with an interest in topical health care policy and legal issues. However, there are some who may have a particular interest in this blog:

  1. Health care CEOs. Health care leaders are very busy and barraged with information. They simply cannot read everything, and much of what they get is not completely objective. This is a site where CEOs can get up-to-date, important information on topics of importance to health care leaders that they can trust. As a recently retired health system CEO, I know what information CEOs need, and there are few other sources of information written by a CEO for CEOs. This is also a source of information that CEOs can use to provide important updates to their teams and their boards.
  2. Board members of hospitals, health systems, insurance companies and other health care organizations. Health care is complicated. It is particularly challenging for board members who come from other industries to understand the complexities of health care. This blog can serve to keep board members informed about important issues that their companies are likely dealing with, as well as to keep them informed as friends, family, neighbors and colleagues ask them about these topical issues since they are likely aware that they serve on a health care board.
  3. Students and other health care leaders. Students of health care will appreciate how complex issues are presented in an easy to understand blog. Current and future health care leaders need a good source of current information, but also a source that may challenge their thinking or help them think about current health care challenges in a fresh and new way.
  4. Journalists. Health care reporters and journalists can at times be challenged to get the information and background that will really help them understand a complex issue that they must digest in very little time in order to hit deadlines and to ask interviewees the “right” questions. This blog will help them do just that.
  5. Legislators. Legislators have a tough job. They have to make law about complex issues in areas of industry that they may not be expert in. To make matters worse, they are often inundated by parties and lobbyists that are interested in what is best for their business, not necessarily what is best for that state or our country. This is an unbiased source of information to help legislators understand these complex issues and the pros and cons of various positions.

Who am I and why should you trust what I have to write?

I am a physician, board certified in Internal Medicine. I practiced for ten years. I am also a health care attorney. I have taught a course titled Regulation of Health Care Professionals for about 13 years, first at the University of Houston Law Center and most recently at the University of Idaho College of Law. I have also written a text book by the same title.

I was the CEO of a large teaching hospital in the Texas Medical Center for almost four years and most recently, I was the President and CEO of a health system for a little over ten years. That health system was recognized for being a national leader in quality and for its transformation of its business model from fee for service to value (full risk arrangements).

While a health system CEO, I had a blog for about 8 years – Dr. Pate’s Prescription for Change.

How often will I post new information?

I am going to try to write something weekly. I am not going to commit to a specific day. There may be times that I miss a week. There will be others will I will post something more frequently, especially when there is breaking news. So, be sure that you are subscribed to the blog so that you receive notice when I have a new blog post. You can also follow me on twitter. I will tweet my new blog posts. My current twitter handle is @drpatestlukes, but I will be creating a new twitter handle soon given my impending retirement from St. Luke’s Health System. I will let you know as soon as that new twitter account is set up.

COVID-19 Vaccine -Many Questions Remain

We all remain hopeful that a safe and effective vaccine to protect us from infection by the SARS-CoV-2 virus will be available within a year. This is far from certain, however, there reportedly have been promising results in early trials (we know little more than what has been in press releases because results of these studies have not been published in peer-reviewed medical literature yet). It is also promising that more than 150 vaccines, using different components of the virus to stimulate the immune response and different adjuvants that may enhance the immune response and prolong the immunity are being investigated. With so many variations undergoing trials, it offers hope that we may even have a variety of vaccines to choose from for our patients that can be tailored to their particular circumstances (e.g., we cannot use live vaccines in patients who are immunocompromised, and sometimes we find certain vaccines are more effective than others in children or in the elderly).

There remain many questions about these potential vaccines:

  1. When will we have a vaccine?

There has been speculation that we could have a vaccine this fall, perhaps as early as October. That would be wonderful, but very hard to believe. And, when people talk about a date that a vaccine may be available, we really need to be clear about what that means. Is that the date clinical studies conclude that the vaccine is safe and effective? Is it the date when the FDA approves the vaccine? Is it the date when manufacturing of the vaccine begins? Is it the date the vaccine is ready for distribution? Is it the date that the vaccine will be in pharmacies and doctors’ offices? The time over which these events transpire can very well be many months.

2. Will there be a sufficient supply of vaccine?

Given that the entire world will need the vaccine, it is widely believed that there will be limited amounts of vaccine available for some time until enough can be produced. The type of vaccine impacts how difficult it is to produce the vaccine and how long it will take. Given this, the state of Idaho is already beginning to determine priority levels for the vaccine. It is anticipated that vaccine will be prioritized to first responders, health care workers and high-risk individuals. So, when we asked above when the vaccine will be available, another question is when will it be broadly available to the public, as opposed to limited in supply such that it must be prioritized and rationed?

3. How many doses of vaccine will be required?

We don’t yet know. It appears that there is one vaccine that may only require a single dose, but it seems likely that most of the others will require a series of two injections a month apart. This has important implications. First of all, compliance with a two-vaccine series would be anticipated to be less than that of a single vaccination. Secondly, a two-series vaccine would generally be more expensive than a single dose vaccine, and cost may create a barrier to immunization. Finally, given the few manufacturers of vaccine syringes and needles and the anticipated increased demand for influenza vaccine, as well routine vaccinations for children, we might encounter shortages, particularly if the coronavirus vaccine requires a two-injection series.

4. How often will vaccination be required?

Unfortunately, recent studies suggest that the antibody response to natural infection with SARS-CoV-2 virus is very short-lived and that it is very possible that as many as 79 percent of those infected do not generate protective antibodies. There certainly is the potential to produce vaccines that will stimulate an improved immune response with the production of neutralizing antibodies, in addition to other immune enhancing effects, and it is possible that we may be able to promote more durability of the immune response with the right adjuvant. Nevertheless, it is very likely that we are looking at the potential of people needing an annual vaccination or perhaps a booster every two to three years.

5. Will the vaccine be effective in the elderly and immunocompromised patients?

There is a senescence of the immune response with increasing age. We will have to determine whether vaccines generate a sufficient immune response in the elderly, whether they require a stronger dose or perhaps more doses more frequently. Immunocompromised patients generally are not able to be given attenuated live vaccines, so we will need other options, and in fact, there are quite a number of other types of vaccines being studied. How effective those other vaccines are will likely depend upon the nature of the underlying immune deficiency.

6. How critical is IgA to the immune response and protection from SARS-CoV-2, and will the vaccine provoke an IgA response?

What we hear about in the press and media about “antibody tests” are tests that detect the presence of IgG, a type of antibody that is available to attack virus in the blood. However, IgG has two important limitations. It is ineffective at attacking viruses once they enter into a cell, and it is ineffective at attacking virus in tissues, especially the lining of the gut. IgA fulfills the latter role.

This is an important issue because the SARS-CoV-2 virus attaches to a receptor called ACE-2. That protein receptor is in the lining of the nasopharynx, the lungs and the gut. Currently, we believe that the target of the initial infection is the nasopharynx, but can the entryway for infection be the gut? Is IgA important in the defense from infection with this virus, as it is for certain other viruses, like polio? Will the vaccine trigger a sufficient IgA response?

The vaccine development for protection from the SARS-CoV-2 virus is encouraging, but far from certain. There remain many questions. No doubt we will get answers to many of these questions soon.

A Note to Hospital and Health System CEOs and Boards

The Time to Seriously Reevaluate Your Organization’s Strategy is Now

Part IV

This is the last of a four-part blog series on reevaluating your organization’s strategy. If you read the first three blog posts, you have considered the following very important factors as you contemplate what your strategy should be:

  • Your financial repositioning following the pandemic.
  • The financial pressures on the individuals, companies and local governments you serve.
  • The potential impact of the 2020 elections.
  • The potential impact of the Supreme Court’s decision on the constitutionality of the ACA.
  • The threats caused by disruptors and especially private equity and venture capital firms.
  • The changing consumer expectations and their fears about seeking services at hospitals.
  • The upcoming realignment of the health care delivery system, particularly for critical access hospitals, community hospitals and independent physicians.
  • The stability of your relationships with your employed physicians.

So, here is my question for you. I am willing to bet money that you have told your board at sometime in the past that fee for service is the problem and value is the answer, or your boards have heard about this at a conference or from an outside speaker, or you have had consultants that have told you and your board this, and most likely all three are the case. Am I right? If so, do you still believe that? Has anything changed to convince you that the current health care spending is sustainable and that the pressures on politicians to address insurance coverage, health care costs, the viability of social security and Medicare, and drug costs will go away, especially during an economic downturn? Are you convinced that employers are going to continue to willingly incur ever rising health care costs in the face of a downturn in their own business?

If these questions were not enough to get your attention and convince you that you are going to have to make a decision as to whether you continue to milk fee for service for all its worth or whether you change strategic direction and pursue value, let’s consider the numbers. Ask your CFO to create a graph or table or whatever method she wants to portray the numbers and take a look at the following 3 or 5-year trends (up to year-end 2019; let’s not confuse things by including the disruption caused by coronavirus):

  • Inpatient and outpatient episodes provided to Medicare and Medicaid beneficiaries as a percentage of all episodes of care for which there was a payer. (In other words, is there a trend in patients moving onto Medicare and Medicaid, which will obviously impact your revenue per case?)
  • Growth in inpatient services vs. growth in outpatient services
  • Net revenue per adjusted admission vs. cost per adjusted admission

There certainly are parts of the country that have been relatively spared from declining fee for service revenues and/or profitability, but my guess is that the majority of hospitals and health systems have been seeing a shift in payor mix to an increase in lower revenue governmental payers at the expense of higher revenue commercial payers, a movement of services that used to be provided as an inpatient to lower revenue outpatient settings (get ready for a movement of all but the highest risk total hip replacements to the outpatient setting), and rising costs per case that will threaten your profitability if you cannot also get increases in revenue per case, which you will be unable to get from governmental payers.

As has oft been quoted, “never let a good crisis go to waste.” I would urge you to forecast your profitability under fee for service, given what I imagine were deteriorating metrics even prior to coronavirus, but also with the environmental factors I discussed in the earlier blog posts of economic conditions, cost pressures on your customers, new market entrants and disruptors, changing relationships for physicians, and a continued movement of inpatient services to outpatient settings.

Then, I go back to my earlier question – do you still believe that fee for service is the problem and value is the answer? If not, stop saying it. If so, read on, because I am going to argue that now is the perfect time to make the shift in your business model.

I know this is hard. I have led a transformation of my organization’s business model, and it is not easy. We undertook preparations for a shift in our business model for seven years and then pulled the switch on January 1, 2017, moving nearly a third of my health system’s revenue largely to percent of revenue arrangements (think global capitation). You might ask why then and why that much.

Why then was because my team and I and our board saw the writing on the wall. We realized that change was coming and that it would be far better to make that change while we were still doing well in our current business model to help fund early losses that would be associated with a change in business model. Secondly, we expected, and it turned out to be correct, that there would be a first to market mover advantage. Plus, we had used that preparatory time to gain the alignment of our staff and physicians. Everyone knew this was the right thing to do and people were excited to do it.

Why that much was because of human nature. I hear of many health systems who say that the answer is in moving to value, but they only pay it lip service with putting 2 – 4 percent of their revenue at risk. That level of risk is not enough to change behavior of your leadership team, your physicians or your staff. I can assure you that it is difficult to make the investments necessary to manage risk if you only have several percent of your revenue involved. And, the organization will not change its behavior. When you have a downturn in finances, the first response will be to increase volumes.

We know from history that many companies have failed in transforming their business models when they were still doing well in their current business model, even when they were convinced that change was coming.

The reason that health care leaders should look at transforming their business model now is that almost no hospital or health system is doing well in their historical business model today. And, if they look at their 3 to 5-year trends, as I suggested above, I think most will conclude that fee for service was on the decline even before coronavirus. Then, if you consider the changed environmental factors I have presented in the earlier part of this series, I think most will conclude that things do look bleak, at least for the next few years.

But, I always prefer making strategic decisions based on opportunity rather than merely responding to threats (though I think anyone would be foolish to ignore the threats). It turns out that the coronavirus has actually presented tremendous opportunities for being more successful in moving to value now than we had when we did this back in 2017. What are those opportunities?

  • People are currently hesitant to proceed with “elective” procedures. (Note: This is bad for fee for service!)
  • Many people have tried telemedicine services for their health care during the pandemic and they like the convenience and safety of it. (Note, in those cases where payers pay less for telehealth visits than for in-office visits, this is also bad for fee for service)
  • Physicians are currently providing a lot of the services that previously would have been provided in the office by phone or by skipping the office visit altogether. (Again, bad for fee for service) Here is an example. My wife had an open reduction and internal fixation of her humerus in December, just before this outbreak. She was scheduled to come in and see the surgeon for a post-op visit last month, at which time she would have an x-ray to check alignment of her bone fragments. The physician’s office cancelled the office visit and just directed my wife to get the x-ray and then the doctor would call her. We did and it saved us time and convenience. Okay, you might argue, well that visit should have been included in the global surgical services fee, but you are missing the point. How many services were we making patients come in for that weren’t necessary? And, because of the pandemic, we actually have physicians deciding what is necessary and what is not, which is exactly the thinking we want under value arrangements, rather than insurance companies making those decisions under fee for service. Further, most every health system has access problems. This is why urgent care clinics, retail clinics, telehealth providers and other disrupters have been able to capitalize on this opportunity to see patients that health systems otherwise would have seen. But, now, with this change in behavior to not make patients come in to the office that don’t need to be seen despite the incentives under fee for service, under value arrangements, we still meet those patients’ needs less costly without an office visit, but we also have just freed up time to see a patient who does need to be seen who we otherwise would not have seen and they either may have gone to one of these alternative care sites or worse, their condition may have deteriorated by the time we could see them to the point that it is now more expensive to care for.

All of these present opportunities for us to manage risk, to lower costs, to promote better access, and to provide care in ways to patients that they are likely to prefer. And, we can look at other opportunities that disruptors were already beginning to pursue even before the coronavirus outbreak, such as mobile health care services that bring care to the patient’s home and hospital-at-home services.

And, the ultimate beauty of this is that while the disruptors and those who are promoting the disaggregation of health care services can beat us at fee for service, very few of them can or, even if they could, would want to manage global risk arrangements. Health systems are uniquely positioned to do this. And, large employers like Walmart, have already realized what I have been arguing for a decade now. The answer is not in a lower unit price. The answer is in controlling utilization and getting high quality services when they are needed. Fee for service does not incent either of these goals. As other employers come to realize this is true, I think private equity and venture capital firms may be happy they sold their health care holdings several years from now.

You know how you fared under fee for service during this pandemic. How would you have fared under full value arrangements? Well, just compare the quarterly earning reports for hospital companies versus those of the insurance companies. There is your answer. Now, I know you are thinking, but this pandemic is going to end sometime, perhaps next year, and things will go back to normal. If you are thinking this, you need to go back and reread the first parts of this blog series.

A Note to Hospital and Health System CEOs and Boards

This is part III of a four-part blog series entitled, “The Time to Seriously Reevaluate Your Organization’s Strategy is Now.”

The health care delivery system in the U.S. is about to realign. The pandemic has likely accelerated alignment decisions that hospitals and physicians were already considering or would likely soon consider even if it were not for the coronavirus.

With all that has happened, do you remember back to last year and the year before? Do you remember the discussions from leaders all across the country that fee for service was the problem with the American health care system and value was the answer? Now, I should be clear. When I refer to value, I mean risk – downside risk. We won’t align incentives with pay for performance or upside only arrangements and shared savings arrangements are unlikely to work in the long-term, they haven’t so far.

While it seemed that health care leaders across the country and even CMS and HHS agreed that the answer was in moving to value, that was the easy part. The hard part is how? I will have more to say about this in Part IV.

But questions circulated as to how big do you have to be to take on risk? What is the role for a critical access hospital in a value world? What about an independent community hospital? What about independent physicians?

For small or independent hospitals, before the pandemic, the question of survival as an independent entity was largely a strategic one – a question that revolved around the world view of the board and CEO. How long would the world remain the same relative to health care? Could the hospital ride it out in fee for service and maintain its independence for the foreseeable future, or even if change was coming, could we ride it out for now, but still have time to make a different decision later if the world does change? For a number of these hospitals, the pandemic has stressed already challenging financials and now the question may be not only the strategic one, but one of financial survival.

For independent physicians, many may never have faced an existential financial threat to their practice before. The pandemic has likely financially impacted nearly every practice negatively. Unlike hospitals, physician practices do not ordinarily strive to have a significant number of days of cash on hand. They typically have few reserves for a situation like this. Most often, a significant cash flow event will cause physicians to make up for it by reducing expenses (lay off staff) and reducing their incomes, both of which are very unpleasant.

Even before coronavirus, many physicians were considering where health care was headed and what their best options would be. While physicians generally value independence and by nature, like to be the ones in charge and making decisions, independence comes at a cost. Practice expenses increase every year, but except for large groups or physicians in short supply, they often have little leverage with managed care companies and may not see revenues increase enough to cover the increasing expenses. Plus, regulations continue to become more burdensome, submitting claims and collecting payments has generally become more challenging given the number of insurers and the differing rules for each payer, and administration of the office continues to become more complicated and less fun.

After this pandemic, or even during it, many physicians may be rethinking their risk tolerance and may seek greater security and ease of practice administration through employment. Others may wish to remain independent, but may seek other revenue streams to provide greater protection, or at least more control, in anticipation of another disruption to their practice.

So, what does this all mean for health system leaders? First of all, open up your channels for communication. Smaller hospitals may want to have exploratory conversations. Even if your health system is not interested in acquiring that hospital, you will need to consider the implications if that hospital is acquired by one of your competitors.

The other thing is you need to begin conversations with your physicians – both employed and independent. You need to know how these physicians are doing, what they are feeling, what concerns they have and whether your relationship is secure.

One of the first questions is whether they felt supported and protected during the pandemic. Unfortunately, I have heard directly or indirectly from physicians across the country who did not feel supported. Physicians who did not feel cared for and did not feel that they had adequate protections. Unfortunately, there were some isolated instances where leaders did not respond productively to care givers’ concerns about safety. I cannot imagine that those physicians will feel any loyalty to those hospitals or those leaders, if they don’t feel respected and cared for.

Even if the physicians did feel respected and cared for, and I am sure that this is the case for the vast majority of hospitals and health systems, they may have concerns about the hospital’s finances and their long-term viability. They may be concerned that the path to financial recovery means cutting physician salaries, because this is exactly what would have happened in their private practice when they were independent when cash flow was impacted. In my experience, physicians are very unlikely to come to the leaders and express their concerns or worries directly. Instead, they may assume the worst and look for a more stable and secure arrangement. Therefore, you need to have these conversations with your physicians and be open and honest about your situation and your plans to recover.

And, even if the physicians felt respected and cared for, and even if they are not concerned about the financial viability of the hospital, you are unlikely to know who is meeting with your physicians and what they are offering. As I mentioned in Part II, private equity and venture capital firms will be looking for better returns than they can make in the bond or stock markets for the foreseeable future. Health care will be one of the opportunities they pursue. They already were prior to coronavirus. Plus, as I mentioned in that previous blog post, they can play off of patient fears about going to hospitals.

I mean no disrespect to physicians. They are brilliant people and amazing professionals who make tremendous sacrifices for their patients, often at the expense of their families and/or their own well-being. But, as brilliant as they are, they are often unsophisticated about business. These private equity and venture capital firms can make all kinds of representations about how much better life can be, how they will be in charge and making all the decisions, how they will have a seat at the table, how they will be far more secure, and the amazing returns they can expect. I haven’t seen one yet that was upfront with physicians and explained the risks and made clear that the way the firm would make more money is to become more efficient (i.e., staff reductions – all that control physicians thought they were going to have over staff and personnel matters – gone), more productive (i.e., all that control over your schedule and how often you would see patients – gone), add more services (i.e., drive more volume for higher revenue-generating services), and that in 3 – 5 years, when the cash flow and profit margin are increased, the firm plans to sell the practice (i.e., you will have a new owner and you don’t have a say in who that is, it will be whoever offers us the most money).

As part of your review of your strategy, you must reassess your physician relationships. Your strategy will do you no good if you do not have engaged physicians to drive the strategy forward.

A Note to Hospital and Health System CEOs and Boards

The Time to Seriously Reevaluate Your Organization’s Strategy is Now

Part II

In Part I of this series, I encouraged health care leaders and their boards to reevaluate their strategic plans in light of the impact of the pandemic as well as the changes in health care that we likely will face with the new normal. In Part II, let’s continue the exploration of what some of these new pressures will be.

As hospital leaders, facing the tremendous financial pressures that you have experienced with loss of revenues and services, you are likely focusing on increasing your revenues by restarting services, as well as cutting expenses since those lost revenues will take quite some time to recover. Guess what? Almost every company and individual you serve will be doing the same thing. While there are exceptions, most companies experienced a significant loss of revenue and will only slowly be able to regain their business. Individuals, too, have lost work and income and likely have incurred more debt. For those who regain work, their hours may be limited, their commissions may be a lot less, and they, too, are likely looking for cuts to their household expenses. It is not likely that most had met their deductible before the coronavirus shut things down. Meeting their deductible now may be a significant deterrent to them seeking any “elective” services anytime soon.

Given the financial realities we are facing, I would suggest that unlike the past, we cannot “make it up on volume.” We have to think differently. Companies and governments will all be looking for cost reductions and health care costs will be a line item with a target on its back. I would also caution health care organizations to no longer think of ourselves as immune from market forces. I would challenge you to think of one industry or one company that has been successful in the long-term by ignoring consumer’s complaints that their product or service is too expensive for substantial numbers of their customers.

I want to suggest that things are different. I want to point out that disruption was coming to health care and I want to make the argument that coronavirus will only accelerate that disruption. Let me explain.

First of all, let me remind you that disruption was already underway before the coronavirus outbreak. You likely haven’t considered that free standing imaging centers, ambulatory surgery centers, free-standing cardiac cath labs and physician-owned surgical hospitals have largely come about and expanded over the last three to four decades. Even more recent was the development of so-called “micro-hospitals.” Also, more recent, the development of telemedicine and telehealth services. Even more recently, mobile health care services to provide primary care or urgent care to people in their homes and also very recent, the design of hospital-at-home services. We can all think of additional examples of disrupters looking to break into the $3T health care industry to get their bite at this, but making services more convenient, more affordable, and a better experience.

Okay, so no one is surprised by this. What is my point? My point is that coronavirus has just handed them a big helping hand. First of all, patients are already saying that they are going to put off all of those services that make hospitals money under fee for service. Surveys indicate that some will put those services off 3 months, some 6 months and some a year. Oh, and what do you think happens if we do have another bigger, deadlier second wave this fall? You would be foolish to think that patients are not going to consider the appeal of these non-hospital settings to receive care as opposed to hospitals where they take care of patients with COVID, even though their concerns may be unfounded.

Second, given at least an economic recession and possibly a depression, the financial pressures on people and the companies or local governments they work for are going to be immense. The appeal of benefit design to drive employees to lower cost settings will be significant.

Further, coronavirus did a lot to force some people to try out telehealth services who before would not have considered them or preferred an in-office visit. From the surveys I have seen, it appears that many who tried it liked it and may enjoy the convenience of it in the future. If hospitals and health systems don’t make this offering available, there are plenty of telehealth companies who will step in to provide it.

Now, I’ll explore this more in Part III, but let’s consider this. The bond market and the stock market are likely not going to be great investment vehicles for the short-term. There will be a lot of private equity and venture capital looking for places to safely and profitably invest their money. It would be a serious misstep for us not to assume a lot of it will go into health care. This, coupled with physicians who have had their businesses turned upside down, probably for the first time in their careers, will be willing partners to create new opportunities for financial returns that can take advantage of the new market realities.

It is not my intention to only identify the problems facing health systems. I will talk about solutions, but first, it is important to finish exploring these challenges because change is hard, and few are willing to make sufficient changes until forced to do so. I want to make the case that while people naturally tend to believe making changes are risky; I want to make the argument that not making change is riskier.

In Part III, let’s discuss physician challenges and opportunities.

A Note to Hospital and Health System CEOs and Boards

The Time to Seriously Reevaluate Your Organization’s Strategy is Now

Part 1 of a 4-part blog series

First of all, I wish to convey my appreciation to all of you for the amazing response to the coronavirus pandemic. I have always been proud of the important work we do as health care workers, leaders and board members, but I have been even more inspired by the courage, bravery, passion, and dedication to our patients and communities that our physicians and staff have demonstrated during this rapidly evolving and challenging time.

No doubt that your communities are very proud of your organizations and your people. During 2019, the national conversation about hospital prices, while a valid concern, nevertheless put the evaluation of hospital prices in the same category of free-standing imaging centers, free-standing ambulatory surgery centers, and physician-owned surgical hospitals that are, in many cases, little more than glorified ambulatory surgery centers. This was an unfair comparison, but it was also very difficult to communicate why. Very few good things have come out of this pandemic, but one of the good things is either the revelation or the reminder that community, regional and academic hospitals and medical centers are very different, and in fact, are critical to the care of our communities and our nation. During this crisis, it was not imaging centers, ambulatory surgery centers and physician-owned surgical hospitals that got us through this crisis and that are preparing for the “next wave,” but rather these community and regional full-service hospitals that provided emergency care, intensive care and saved countless lives of people infected with SARS-CoV-2 that developed severe illness. While the federal government lent some limited assistance to hospitals in a few hot spots of the country, the reality is that without our community, regional and academic hospitals, the deaths in our country would have been much more staggering than they already are.

Hospitals and health systems have suffered tremendous financial losses during the pandemic already, and as I have written previously, we are far from being through this. Some hospitals will not survive financially; some will survive but through a change in ownership. Nevertheless, we will eventually get through this, life will return to a new normal, and memories of the health care heroes will fade – not that we will ever forget, but just like 9/11, where we were justifiably proud of our first responders and there was justifiable national pride for some period of time, the pressures of daily life and new events and challenges will take over the headlines, and for many, the remembrance of all those who lost their lives and those who were the heroes responding to this crisis has become an annual event on the anniversary in September.

Next year, or whenever it is, the headlines will no longer be consumed by coronavirus (let’s hope!). But, we likely will have an economy hard hit by this pandemic, with small businesses and other companies perhaps still feeling the economic pressures from the fall-out, a focus on managing costs (which will revive the discussions about health care costs), and perhaps still high unemployment. In addition, state and local government budgets will be stressed (which will again bring focus to health care costs) and given what are sure to be tax revenue shortfalls, these governmental bodies will be making cuts to their budgets, including looking for health plan savings.

Additionally, by this time, we will have a presidential election and are likely to have one of the most important Supreme Court decisions ever to be issued – the fate of the Affordable Care Act. Both are of monumental importance to health care leaders and may profoundly impact your organizations. All of this needs to factor into your review of your strategy or renewed strategic planning.

Let’s just remind ourselves of what we are likely to see as we open back up our normal services under the current administration and with the ACA still in effect.

Record numbers of people have lost their jobs or were furloughed. Hopefully, many will be reemployed soon. However, we know that unemployment will be up, which will mean those who have lost their incomes and don’t have other sources are likely to join the ranks of our uninsured or Medicaid expansion populations (for those states that have expanded Medicaid). Some will qualify for advance premium tax credits and subsidies on the public exchanges that will enable them to remain insured. But, regardless of how this all shakes out, it is hard to imagine that we will not see:

  • Increases in bad debt, especially for those who maintain their insurance with high deductibles and significant out-of-pocket expenses or those who lose their insurance and are not eligible for Medicaid (the gap population).
  • Increases in charity care.
  • A marked increase in Medicaid.
  • A continued shift from commercial insurance to Medicare.
  • A shift of commercial coverage with rather broad access networks to exchange plans with narrow networks, which may mean you are now out-of-network for some patients you previously cared for.
  • Decreased revenues from ambulatory and outpatient services as people put off care or planned surgeries.
  • Decreases in revenues as some patients continue to fear coming to the hospital.
  • Patients presenting with more advanced disease as they put off screenings and preventive care (this will increase the number of patients for which the revenues do not cover the costs of providing the care)
  • Patients may present sicker because of deferring coming to the emergency room due to their fears of contracting coronavirus, which will make their care more costly and less likely to be covered by DRG payments or other reimbursements.
  • Decreased operating margins, which will in turn decrease our capital spending on facility renovations, new facilities, new technology and new services.
  • Decrease in days cash on hand due to the decrease in revenues and increased costs managing through this pandemic.
  • Downgrades of bond ratings by rating agencies based on the deteriorated financial performance and metrics, which will increase borrowing costs.

Not a rosy picture, right? It gets worse. Let’s now imagine that Republicans maintain control of the White House and Senate and the Supreme Court strikes down the ACA.

I have not seen the Republican replacement health care plan – or maybe I have, which would be more alarming. Maybe the plan is the bits and pieces we have already seen – association health plans, short-term “skinny” health plans, religious ministry cost share programs and block grants to states for Medicaid.

With striking down the ACA, the public exchanges, advance premium tax credits, subsidies and Medicaid expansion all go away.

So, let’s see how this combination of events would cause me to revise the list of impacts above. Here is the revised list:

  • Significant Increases increases in bad debt, especially for those who maintain their insurance with high deductibles and significant out-of-pocket expenses and those who develop conditions that are excluded form coverage under their new policies, and from or those who lose their insurance and are will almost certainly not be eligible for Medicaid (the gap population) and for whom there is no option of a subsidized exchange plan. Bad debt will also increase due to failure of association health plans or religious ministry cost sharing plans to cover the service after it was provided or as a consequence of their insolvency given their lack of state department of insurance oversight.
  • SignificantIncreases increases in charity care.
  • A marked Some increase in Medicaid.
  • A continued shift from commercial insurance to Medicare.
  • A shift of commercial coverage with rather broad access networks to exchange plans with narrow networks, which may mean you are now out-of-network for some patients you previously cared for.
  • Decreased revenues from ambulatory and outpatient services as people put off care or planned surgeries.
  • Decreases in revenues as some patients continue to fear coming to the hospital.
  • Patients presenting with more advanced disease as they put off screenings and preventive care (this will increase the number of patients for which the revenues do not cover the costs of providing the care) due both to fears of coronavirus, but also the fact that preventive care and screenings will no longer be covered services and will no longer be provided without out-of-pocket expense.
  • Patients may present sicker because of deferring coming to the emergency room due to their fears of contracting coronavirus or limited insurance coverage, which will make their care more costly and the costs less likely to be covered by DRG payments or other reimbursements.
  • Decreased operating margins, which will in turn decrease our capital spending on facility renovations, new facilities, new technology and new services.
  • Decrease in days cash on hand due to the decrease in revenues and increased costs managing through this pandemic.
  • Downgrades of bond ratings by rating agencies based on the deteriorated financial performance and metrics, which will increase borrowing costs.

I have written previously about what I think the outcome of the legal challenge to the ACA should be (uphold the lower court’s determination that the individual mandate is unconstitutional, but preserve the remainder of the statute and merely sever the individual mandate from the statute). But, predicting the outcome with the change in the make-up of the Court since the last time it considered the constitutionality of the ACA has become much more difficult.

All of this must be taken into account for your review of your current strategic plan or for your new strategic plan. But, there is much more to be considered. I will address additional concerns and issues in Part 2 of this blog series.

A Note To Hospital and Health System Leaders

Note to readers: This is the introduction that will kick off a 4-part blog series on strategic planning for hospitals and health systems.

You have been through a lot. We have battled the first pandemic in a decade. For many of you, this will have been the first pandemic you have led an organization through. Unfortunately, for some of you, this may very well not be the last pandemic of your career.

This has been a very challenging time. For some of you, you have had physicians and members of your organization infected by this virus; some of you may have even lost colleagues to this pandemic. You have suffered tremendous financial losses. You have likely faced the difficult decision whether to lay off or furlough employees. You have put your disaster and pandemic plans in place, staffed up incident command centers, struggled with your supply chains, had to learn about a novel pathogen and how best to address it, and often improvised or innovated along the way. You have probably also struggled to keep up with all the media requests for updates and interviews and the demands from state and federal agencies for data reporting.

Many of you, exhausted, sleep-deprived and without a day off in months, including weekends, are now facing your first lull, having navigated through the first wave of this pandemic. After getting some much-needed rest, you may be able to move from crisis management and thinking about the next day or week, to thinking more strategically, to the important question of now what? How do you recover financially? Is it time to bring back employees who were laid off or furloughed? How will we restart our other services? What about construction projects or new services we were planning before this hit us?

These are all important questions, however, I hope you are also taking this time when you can clear your mind a bit to think about what lessons did you and your team learn from this? What do we need to do to be prepared for a possible second wave – a wave that based on previous influenza pandemics could be even bigger and deadlier? What changes should we make to our disaster and pandemic plans to learn from this experience and prepare our organization and its future leaders to respond even better to the next pandemic or other more localized or regionalized threat?

But, I would suggest that this is also the time to begin a review of your strategic plan and very likely substantial revisions or even a completely new strategic plan. Whether we acknowledge it or not, the world has always been changing. It was last year before any of us knew about this novel coronavirus. In many ways, this pandemic will accelerate the change, especially in health care. If you don’t anticipate these changes, coronavirus will be the least of your long-term concerns.

First things first. What would I specifically recommend?

  1. Take this time to thank your physicians and employees. If you have lost members of the team, be sure to memorialize them. If physicians or staff have been infected and recovered, acknowledge them and thank them for their service and sacrifice. But, thank everyone, and be especially cognizant that while nurses and doctors have understandably received the highest profile in the media and online, we have many unsung heroes. Many of our non-clinical staff have saved lives. Can you imagine how many more people would have been infected without the diligent cleaning and disinfecting by the environmental services staff? Can you imagine the number of additional infections and potentially deaths if your supply chain staff had not been resourceful and pursued non-traditional sources of PPE and hand sanitizer? And, your non-clinical staff may have been most fearful about coming to work, yet critical to the operations. During this time, we still had to register patients. We still had to provide the staff and patients with meals. We still needed our hospital operators to handle calls from distraught family members who could not visit their loved ones. And, there are many clinical staff who may or may not have been at the bedside, but were still critical to our success in managing these patients – pharmacists, respiratory therapists (arguably the most dangerous job), imaging and laboratory professionals, the palliative care team, medical assistants, nursing assistants, clinical educators (can you imagine with the rapidly evolving and changing guidance if we did not have these professionals updating and educating our nurses and other clinicians?), unit secretaries (back when I did this job I was called a ward clerk), physical therapy, IT, medical records, and the list goes on and on. With the financial hardships we all are facing, we also need to express appreciation to all of our revenue cycle experts – billers, coders, and all those who had to keep up with all the new rules and regulations for financial assistance from the government. My point is that doctors and nurses deserve our tremendous debt of gratitude, but so does everyone else on our team. Be sure they all get recognized. They were there when we needed them.
  2. Acknowledge the support of the public and external stakeholders – EMS, donors, volunteers, all the companies who donated PPE to us, the public that made home-made masks, and everyone else who contributed to our success in managing through this. These are heroes too. Sadly, at my former health system, we lost a dedicated volunteer to this disease.
  3. Begin your messaging to the public that you are taking extraordinary steps to ensure their safety when they need your services and that the risk of staying home with a stroke or a heart attack is much greater than the extremely remote possibility of contracting COVID by coming to the ER or other sites of care.
  4. As I mentioned above, conduct a formal debriefing with all the leaders involved in managing this first wave. What went well and what didn’t? What were unanticipated issues that we didn’t address in our prior disaster and pandemic plans? What did we learn? What would we do differently? This is the time, while it is still fresh in everyone’s minds to update your plans and prepare for a potential second wave.
  5. Reevaluate your supply chains. Perhaps I shouldn’t have been surprised, but my biggest surprise was how relatively little there was in the national strategic stockpile. I had always thought that if there was a major event, we could rely on the federal government to get us the supplies we needed. Turns out that is not the case. In fact, the lack of federal preparation meant that physician groups, hospitals, health systems, states, and the federal government were all competing for limited supplies by bidding against each other and other countries. Obviously, if we cannot agree to national preparation and a national coordinated response, then we have to plan differently to ensure that we have the supplies we need for the next wave or next crisis.
  6. We also need to reevaluate our policies. For example, do our policies discourage people from staying home when they are sick by requiring a doctor’s visit and note or using unpaid time off?
  7. It is likely that all of us realized that our information systems were not well designed to track and report syndromic, epidemiologic and supply data for internal and external purposes. Leaders should review with their teams what changes are necessary to automate this data collection for the future, in collaboration with the state. In addition, health systems have likely seen the value of internal modeling and predictive analytics given the limitations of other models that were available to us. This may be the time to strengthen our commitment and investments in data analytics.
  8. Finally, as I mentioned, I believe this is an important time to revisit the environmental and economic landscape of health care and our communities, the assumptions we used in prior plans, the cost pressures that will be on health care providers and our customers, the lessons we have learned through this pandemic relative to our clinical model and what the new normal is likely to be. Because of the importance of this topic, I have created a blog series to help leaders and their boards think about the implications of where we were, where we are now, and what is likely coming to begin a reassessment of the current strategic plan, or perhaps new strategic planning from a fresh point of view.

Important Information for Parents: Pediatric Inflammatory Multisystem Syndrome (PIMS): A Possible COVID Complication in Children

While children seem to be less susceptible to SARS-CoV-2 (this is my guess at this time) or alternatively, if they are just as susceptible but tend to disproportionately get asymptomatic disease from the novel coronavirus that causes COVID, there is a rare complication that may be caused by COVID that we are only seeing in children – Pediatric Inflammatory Multisystem Syndrome (PMIS).

PIMS resembles a disease that we are already familiar with – Kawasaki disease, but yet there are important differences. Kawasaki disease is a vasculitis, i.e., an inflammation of blood vessels, in this disease typically inflammation of mid-sized arteries, which can lead to one of the worst complications of Kawaski disease – aneurysms of the coronary arteries and impairment of heart function.

In Kawasaki disease, children often have recent respiratory or gastrointestinal symptoms, and then become more ill and present with fever, redness of the eyes (conjunctivitis), red and cracked lips, a red and swollen tongue and redness inside the mouth, rash, swollen lymph nodes in the neck, painful joints, redness of the palms of the hands and the soles of the feet, peeling of the skin over the hands and feet, abdominal pain, vomiting and/or diarrhea. Most often these children are under the age of 5.

Although there can be serious complications, most children recover fully from Kawasaki disease.

We don’t know what causes Kawasaki disease, but it seems to follow an infection in children (which suggests that it may be a consequence of an overactive immune response) who possibly are genetically predisposed to developing Kawasaki disease. We treat Kawasaki disease with gamma globulin and aspirin, but many children will get better within two weeks, even without treatment.

During the SARS-CoV-2 pandemic, and as far as I know, just since April, we have seen children in Europe and the U.S. who have presented with an illness similar to Kawasaki disease, but in older children and often in a more severe form, often exhibiting signs of both Kawasaki disease and toxic shock syndrome (circulatory dysfunction), which can manifest as cardiac dysfunction and kidney injury.

While the greatest number of cases have been reported in the New York City Metro area, cases have been reported in California, Connecticut, Delaware, Georgia, Illinois, Kentucky, Louisiana, Massachusetts, Mississippi, New Jersey, Ohio, Oregon, Pennsylvania, Utah, Washington and Washington D.C., and perhaps in more states by the time of this writing.

While we are still learning about the many twists and turns associated with the SARS-CoV-2 virus, and have only recognized this newest manifestation of infection with this virus in the past month, here is what we can tell concerned parents today:

  1. Children seem to be less susceptible to infection from this virus than adults. If, in fact, they are just as susceptible, then they seem far more likely to have asymptomatic infections.
  2. Children typically only account for 1 – 2 percent of all the recognized cases of COVID in most populations, and at worst, perhaps up to 7 percent.
  3. Even if children do get sick with COVID, they tend to do well, have mild illness and children rarely need the critical care serves and ventilators that are more commonly seen with middle-aged and older adults.
  4. We still don’t know what role children play in transmitting the disease. That is to say, even if children do not get sick, but are infected, do they shed the virus and transmit it to other children and those in the household? So, while you don’t have to worry excessively about your children becoming seriously ill, you still need to be cautious about children, even those that appear well, coming into contact with those who are at high risk for this disease (the elderly and those with high medical risk).
  5. This is an excellent time to teach your child, if old enough, about proper hygiene, hand washing, and how and why to cover their coughs and sneezes.
  6. With all this said, even though most children will be just fine, if your child is sick, keep your child home. Contact your child’s doctor to let the office know about your child’s symptoms so that they can determine whether your child should be tested. Kids do manifest symptoms differently than adults and with COVID may be less likely to have fever or respiratory symptoms than is typical of adults.
  7. If your child does test positive for SARS-CoV-2, you should assume there is high risk to everyone else in the household. Someone from the public health department will contact you and give you specific instructions, but two things – if it is practical, keep your child in one room of the house and have the child use one bathroom and everyone else use a different bathroom. Meticulously clean surfaces and regularly wash linens and pajamas. Minimize the number of other family members who come into that room and be extra careful about handwashing. If your child will tolerate it, have them wear a mask when anyone else needs to be in the room. And, secondly, you must consider that anyone at home living with the child is at high risk of being infected. Thus, it is best if everyone in the household remains isolated for 14 days to determine whether anyone else will develop symptoms.
  8. The new condition I described above is still rare at this time, but we are seeing new cases all the time, so if your child does develop any of the symptoms I listed above, let your child’s doctor know right away.
  9. It is always good to know where your closest children’s hospital is. If you need to go to the emergency room for evaluation and it does not appear to be imminently life-threatening, go to a children’s hospital if it is reasonably close by and call ahead to let them know you are coming. Of course, if the situation appears to be life-threatening or emergent, call 9-1-1 and go to the nearest hospital.

What Keeps Me Up At Night

It is a common question that I have gotten, ever since I became a CEO more than 14 years ago – “What keeps you up at night?” I also get it now in regards to the coronavirus pandemic. I never tell anyone all the things that I am losing sleep over. It doesn’t do anything but cause others to lose sleep. The only fears that I share are ones that I think will actually benefit others to be aware of.

I was asked this question a couple of months ago in response to whether I was concerned about hospital bed capacity in Idaho. I replied that it wasn’t in my top 25 of things I worry about. A local business leader tried to Twitter-provoke me implying I should be worried about it. There are so many things to worry about, I have to prioritize my time spent worrying. He didn’t know what was in the top 25 on my worry list, or he would have understood why worrying about hospital capacity didn’t make it.

But time has passed. We have learned so much in the past two months. My list has evolved, but it hasn’t changed that much. I am not going to share my top 25 list, but I am going to share with you a few things that are on it, especially since some of these concerns have now made it into the press.

If you have followed my blog or discussed this issue with me, you know that I have been concerned for sometime about the predictive models that have been circulating in the media and online. They generally show a very nice, symmetrical bell curve graph that generally ends sometime this month or later this summer. Oh, that this were true. It would be wonderful. However, all of these models are inconceivable to me.

Why? Because the best guesses are that no more than 5 percent of the U.S. population has been infected with SARS-CoV-2. The limited antibody testing data available seems to support this. In fact, for Idahoans, that infection percentage is likely less than 2 percent.

As I have written previously, the lowest estimates are that it will take 60 – 70 percent of the population to be infected and/or immunized in order to slow down the transmission of the virus to the extent that the vulnerable and susceptible among us are relatively protected.

The only reasons that SARS-CoV-2 would stop causing infections this summer include (1) the attainment of herd immunity through natural infection (however, as I stated, best estimates are that only 5 percent of the country has been infected, so it is not reasonable to think we could get to the levels required for herd immunity anytime soon), (2) the attainment of herd immunity through immunization (however, there is no basis to believe that we could have an effective vaccine much before the end of the year, and even that would be an extremely aggressive timeline. Many experts are skeptical as to whether we will even have a vaccine next year), and (3) the virus mutates in such a way as to be far less contagious.

The SARS-CoV-2 virus is an RNA virus. RNA viruses are well known to mutate frequently. We know that there have already been at least 14 mutations of the SARS-CoV-2 virus just since late December/early January. Unfortunately, a mutation that probably occurred in February has already resulted in the virus likely being more contagious, not less and is likely the predominant, but not only, form circulating in Europe and the U.S.

My concern is that people seeing these depictions of models showing an end of disease activity this summer, the talk of reopening the country and getting back to work and school, and the early messaging about winding down the White House Coronavirus Task Force may lead many people to believe that we are nearing the end of this pandemic.

So, if the bell curve depictions are wrong or misleading, what does the future look like? With the caveat that no one knows for sure, I think a better depiction would look like a series of waves, where activity waxes and wanes. In other words, the number of infections will increase significantly, and then we will reinstate countermeasures that will bring the cases back down. But, with this said, I don’t expect that all the waves look the same. And, these waves will not look the same all across the country. The waves will be of greater amplitude in those cities of our country with mass transit, international airports, high population density and less effective social distancing.

So, if the virus is not going away this month or in the next couple of months as many of these diagrams suggest, what do these waves look like for the rest of 2020 and when do they come? There has been hope that the transmission of the virus would decrease over the summer with increasing temperatures, increased humidity and people being outdoors more. While we can still hope that is the case, it doesn’t appear very likely. First, we did not observe this in the southern hemisphere as those countries went through their summers. Additionally, it is likely that even if transmission is somewhat decreased, it may be offset by the large part of the population that remains susceptible to this virus (perhaps 95%). Further, my expectation is that we will see new waves of disease in the next three to four weeks (end of May/early June) that will result from reopening of communities in some parts of the country that are opening too much, too fast. Additionally, as travel resumes, we will have people bringing the virus with them to communities where they can significantly increase spread.

So, expect another wave by early June. I don’t think it will be as big as the first wave we have just been through since high risk individuals are largely continuing to stay isolated and even with the reopening, many people are choosing to continue to be reluctant to return to work, shopping and other activities until they see how things evolve.

On the other hand, I am worried about people who are falsely reassured by positive antibody tests. These tests are becoming widely available despite widely varying accuracy, a significant risk for false positive tests in low prevalence areas and a lack of evidence as to whether antibodies confer immunity. False positive tests could cause persons to exercise less prevention measures thinking that they are immune. We do know that most (but certainly not all) people who become infected do make antibodies to SARS-CoV-2. However, the immune response to SARS-CoV-2 is very complex and antibodies are only one small part of the body’s response. Antibodies are not produced until a week or more after infection. The initial immune response is non-specific (the innate immune response). If the virus survives this initial defense, it enters into cells to replicate and antibodies cannot reach the virus when it is inside cells. But, as virus is replicated in the host’s cells, the virus is released and antibodies can attack the virus. But not all antibodies do so or are effective in neutralizing the virus. We don’t know whether the antibodies to SARS-CoV-2 virus neutralize it, though there is good reason to expect that this might very well be the case. There are other viruses that also stimulate antibody production, but the antibodies do not provide immunity and do not stop the infection from continuing on, so we must take care to ensure that antibodies to SARS-CoV-2 are truly protective before we provide individuals with positive tests that impression or that reassurance.

We do expect that antibodies will confer some degree of immunity, but we do not know for how long. It could be for weeks, months or even a few years, but we don’t know. Further, the mutations identified that I referenced above have raised the question as to whether someone who is previously infected and develops immunity is immune from reinfection with the virus form that has mutated. Without answers to these questions, we run the risk that people who believe they are immune take fewer precautions and actually become risks for contracting and transmitting the virus. Plus, we don’t know whether the tests we have available that were designed to detect the original virus nucleic acids, antigens or antibodies will detect the new forms of the virus after multiple mutations.

So, after a next wave in late May/early June, I fear a bigger wave in the fall. Although there are important differences between this coronavirus and the flu, past influenza pandemics do give us some important insights into what might happen with this coronavirus pandemic given that coronavirus and influenza are both respiratory viruses and transmitted in similar ways, though there are reasons why the coronavirus is more of a threat due to greater contagiousness, a longer incubation period, a longer period of asymptomatic or pre-symptomatic viral shedding, etc. In several of the past influenza pandemics, a small wave of infection occurred in the early part of the year, as we have just been through, followed by a significantly larger wave about six months later in the fall. This happened with the 1918 – 1919 Spanish flu pandemic and the second wave was much deadlier. There is speculation that the influenza virus may have mutated during the time between the first and second waves. The longer the virus continues to spread, the greater the chance for mutations that will make the virus more contagious and/or more deadly.

I fear we could see this happen. And, unfortunately, late fall is also when we see the resurgence of other respiratory viruses, so it may be harder to detect COVID cases, as it was at the beginning of this year. I fear that this means cities like New York, New Orleans, and Seattle could be in for an even larger outbreak of this virus than they have just been getting behind them, and I am sure that this is unimaginable for them.

Of course, it is also possible that Americans will sustain their efforts at social distancing and good hand hygiene for the next year or years until we do have a vaccine or achieve herd immunity through natural infection. This could mean that we have ongoing waves, but of low amplitude that do not overwhelm our health care system and do not disrupt our lives as much as happened over the past couple of months. On the other hand, I fear that the SARS-CoV-2 virus might mutate enough to evade our immune systems so that it becomes a recurring seasonal infection much like influenza, and even if we have a vaccine, we may need to get periodic vaccines to adjust to new strains of the virus.

Obviously, effective therapeutic options that taken early might prevent serious illness and deaths and/or an effective vaccine would be game changers and allow me to remove many of these concerns from my top 25 list.

Until then, I encourage Americans not to let our guard down and our federal and state governments and local hospitals and health systems to use this time of relative recovery over the summer to prepare for a potential second wave in the coming weeks and a potentially severe third wave this fall. 

The Most Frequent Question I get about COVID

Here is the most frequent question I get. It goes something like this. The virus isn’t going away. We can’t stop it without a vaccine and that could be a very long time, and our economy cannot be shut down that long. The only way to slow it down is to achieve herd immunity. We know who is most vulnerable, so why don’t we just keep the elderly and those with serious medical conditions home and get everyone else back to work so that we restore the economy and get to herd immunity?

It is a very insightful question. So, let’s dig in.

First of all, I want to commend the many who have come to the realization that it is very unlikely that this virus is going away anytime soon. Everyone has seen the various models shown on cable and on the internet showing a bell-shaped curve that seems to magically end sometime this summer. These graphs and depictions are terribly misleading. Those really only portray the first wave of this pandemic, and most all experts agree that there will be more waves coming, though it is uncertain how many and what their magnitude will be.

SARS-CoV-2 is an RNA virus and RNA viruses do tend to mutate frequently, and this virus has already mutated a number of times. It is possible that it could mutate and become less infectious or transmissible, and this happened to some degree in the case of the first SARS virus, but this is something we can hope for, but should not anticipate. This would be the only scenario I can think of where the models I referred to above could be right.

Let me also commend the growing number of people who are understanding what herd immunity is. This is the level of immunity in a population required to significantly impair the transmission of the virus. Herd immunity does not mean that a person within the herd (the community) cannot become infected, but it means that the chances are significantly reduced because so many in the herd have immunity that there is no longer efficient transmission of the virus. In other words, there might be isolated cases, but we would be unlikely to see an outbreak of disease in that population.

Herd immunity protects infants who have not yet had the infection and who may be too young to receive a vaccine and it protects those that are high risk, such as those who are elderly and might have waning immunity or those who are immunocompromised and may not be eligible for or protected by a vaccine.

The more contagious a virus is, the higher the level of herd immunity that will be required. For example, the reproduction number (an indicator of how many people someone infected is likely to infect without mitigation in a vulnerable population) is about 6 times higher for measles than it appears to be for COVID. Therefore, herd immunity for measles likely requires that 93-95 percent of the population be immune, either by vaccination or prior infection in order to achieve herd immunity. Mumps has a reproductive number about 5 times that for COVID, and it is estimated that about 90 – 92 percent of a population needs to be immune to prevent spread of mumps to susceptible individuals in that population. For this particular virus, we don’t yet know the level of immunity necessary in a population to slow down the transmission, but projections are in the 60 – 70 percent range.

In Brazil, there was an outbreak of Zika virus. After two years, about 63% of Brazilians had natural immunity (i.e., they had previously been infected and developed immunity to reinfection). This was a high enough percentage of Brazil’s population that the viral spread burned itself out.

With polio on the other hand, a vaccine was developed that was highly effective, and a sufficient number of the world’s population was immunized that polio has essentially been eliminated except from two countries that do not immunize their populations (Afghanistan and Pakistan).

So, now back to the question I get asked. Since a vaccine is not in sight and we know the high-risk populations, why don’t we keep the high-risk individuals at home and get everyone else back to school or work and let’s get to 60 – 70 percent of the population infected so that we have herd immunity?

For illustrative purposes, let’s consider the U.S. a herd. It isn’t because for your purposes, it is the community or population with which you interact and come into contact so it might be quite a bit smaller, but assuming that we want to think about travelling and coming into contact with others at U.S. airports, taking the kids and grandkids to Disneyland, going to sporting events where people from different states are coming together for competitions, visiting other cities and staying in their hotels and going to their restaurants, etc., let’s just look at the United States. (keep in mind that something like 80 million international travelers come to the U.S. each year, so those cities in the U.S. that have disproportionate numbers of international visitors such as Washington D.C., New York City, Los Angeles and Las Vegas may still have outbreaks of disease even if they otherwise have herd immunity, if a sufficient number of these travelers are not also immune. Take for example, McCall, Idaho. Its population can double over the summer months due to visitors and persons with second homes. This could significantly dilute the McCall’s herd immunity if these visitors come from areas that have not achieved herd immunity).

Let’s also assume that we don’t really intend to sentence our seniors to isolation from family, friends and all other contacts for what could be the remainder of their lives until a vaccine does become available. Instead, if we consider the elderly as part of the herd and that we want the herd immunity to give them added protection so that they, too, can return to some semblance of normalcy, though they still may need to exercise precautions, then we will include seniors in the denominator of our total population for achieving 60 – 70 percent immunity. Keep in mind that in our long-term facilities, where many elderly residents have died, it is likely that the exposure of these residents to COVID was through visitors, and more likely, through caregivers who were in contact with others, became infected and then spread the virus to the residents.

The population of the United States is approximately 326.7 million people. Let’s use 2/3rds of the population for the herd immunity threshold. The number of Americans that would have to be infected to reach the herd immunity threshold would be almost 219 million. We don’t really know the case fatality rate for COVID because we do not know how many people have been infected, but even considering asymptomatic and mild infections, most experts seem to think that the mortality rate is at best 0.5 – 1 percent. So, let’s use 0.75 percent. That means that if only 2/3rds of Americans got infected, approximately 1.6 million would die from COVID. Thus far, the U.S. death count from COVID is 65,735 – only about 4 percent of the total deaths that would occur if we were to get 2/3rds of our population infected to achieve herd immunity. That would mean that the U.S. would experience 1,575,932 more deaths from COVID until we reached the herd immunity threshold.

Now there is a whole lot in between mild illness and death. In other words, the price we would pay for herd immunity is more than just loss of life. There are many who would survive, but would endure a prolonged hospital stay, significant morbidity and disability and a prolonged recovery. Keep in mind that while the elderly are more likely to die, 69% of cases, 55% of hospitalizations, 47% of ICU admissions (and generally, it is about half of these who would be on ventilators), and 20% of deaths occur in those under age 65. Many of these affected would be in the prime of their lives.

Not only could just the illness in individuals under age 65 in some cases overwhelm the health care delivery system and result in significant health care costs for society as a whole, but there would be loss of work force productivity due to illness and subsequent disability. For example, of those who require mechanical ventilation, even prior to COVID, these patients not infrequently suffered from traumatic false memories and even post-traumatic stress disorder. This occurs even with the usual support with a ventilator generally being several days. With COVID, those requiring ventilator support often can require it for one to three weeks. We expect that far more will suffer these long-lasting sequelae, resulting in disability, significant ongoing treatment costs and lost productivity at work.

In addition, we have learned that SARS-CoV-2 is not just a respiratory virus. It can cause systemic disease, and in fact, we are seeing a growing number of cases of kidney failure, major strokes and other vascular consequences in young adults in their 30s and 40s. While this is still a minority of young people, the consequences and disability can be significant in these people who otherwise would be in the prime of their lives.

Without a cure for this disease, or at least a treatment that can prevent the disease from becoming severe, we must continue to take infection control measures to slow down the spread of this virus until the virus burns out, we have effective treatments or we have a vaccine. That doesn’t mean that we have to keep the economy on hold. It just means that we have to adapt. Some of these changes will likely need to stay in place after COVID. We need to abandon the handshake. The culture of schools and businesses needs to change to encourage people to stay home when sick. We need to use technology for virtual meetings, for physician visits, for school and working from home, when feasible. And, no doubt many businesses will operate differently, at least for the next year or two. There will likely be more online services, curbside delivery or appointment-based services with screening of both employees and clients. We have to get as many businesses back open as soon as possible and as safely as possible.

For the reasons above, the answer cannot be full-speed ahead with the economy in an attempt to achieve herd immunity. But, at the same time, the answer also cannot be to shut down the economy for a couple of years to achieve herd immunity through vaccination. We have to strike the right balance between slowing the spread of the virus to a manageable level that does not overwhelm our health care infrastructure or result in more mortality and morbidity than necessary, but yet getting businesses back open and people back to work because there are also many excess health consequences for people who are unemployed, uninsured and unable to access routine health care.

The Invisible Army

A Tribute to our Public Health Workers

President Trump has made an apt analogy indicating that we are fighting a war against an invisible enemy. My service on the Governor’s Coronavirus Work Group has given me an opportunity to see Idaho’s “invisible army” from behind the scenes. I refer to the amazing men and women who serve in our state’s Department of Health and Welfare and local public health departments.

I refer to them as an invisible army because most Idahoans don’t know who they are or what they do, and are unlikely to interact with them directly. These are incredibly dedicated and passionate experts in their fields who work at our state laboratory, who work as epidemiologists, who trace the contacts of those who become infected, who track disease activity and statistics, who coordinate our responses to public health threats, and who help educate and advise the public and our health care professionals.

These individuals often turn down more lucrative opportunities in the private sector because of their passion for the work of public health and their commitment to being public servants.

I have been amazed at the experience and expertise we have here in Idaho. I cannot tell you how fortunate we are to have these talented individuals who dedicate their careers to promoting the health of Idahoans. We owe them a debt of gratitude.