This pandemic has affected everyone in some way or form. Many businesses and restaurants will not be able to reopen once stay-at-home orders lift, many people will find themselves without a job, and the economy will struggle to gain momentum again. Inevitably, the health care system will change as well.
At a time when health care workers are putting their lives at risk to help others, some institutions are drastically cutting their pay. A simple search will show various hospitals and health care systems implementing cost-reduction changes, including furloughing employees. This would affect those on the front lines, not just those doing non-essential elective procedures that have seen a decrease in cases. They are already worrying about getting infected with SARS-CoV-2 at work and developing COVID-19, and even possibly transmitting the virus to their family. Now many health care workers have to worry about their job. So why is that?
The fact is that many hospitals are cancelling, or have already canceled for some time now, non-urgent surgeries and procedures that during the year can make up much of these places’ profits. Additionally, expenses continue to rise as hospitals are needing to bolster on certain supplies that they may not need as much of typically. These supplies include, but are not limited to, additional beds that are in a secure area away from other patients (many are termed COVID-19 units) as well as PPE for health care workers (many hospitals have been unable to secure enough to protect their workers), and ventilators if their area is to be greatly affected by the pandemic.
Additionally, reduction in inpatient encounters as well as a large reduction of ambulatory/outpatient volume has greatly affected revenue. Will this be something that continues post-pandemic? Will many hospitals and practices decrease their amount of in-person visits? This is a system that some have already started to transition to prior.
The fact is many hospitals have accrued debt over time with recent expansions or renovations and are not privately funded. They have focused their finances in one area, while appearing to have neglected the dreaded “worst case scenario.” This will inevitably force more hospitals and health care systems to place more effort on understanding the eligibility and timing of the distribution of funds were something like this to happen again. Unfortunately, at this time many are now having to lay off part of the workforce or reduce hours of essential personnel only to surge for others that have not worked in that area before. Of course those hospitals or systems that may be backed by private investment groups may have the luxury of staying afloat for some time longer.
It is difficult to say if many of these hospitals will benefit from the CARES Act, and unfortunately many of them won’t. The law includes $100 billion that will be administered to nonprofit hospitals, but many of these hospitals will still be unable to recover from lost revenue secondary to the pandemic. To be clear there is also no guarantee on the amount that some hospitals will get from the state and federal fiscal stimuli proposals that have been announced. Additionally, there is no guarantee on timing and if it aligns with that of the hospitals.
Some hospitals explicitly indicate that “every member of the team will see some impact to their pay or job.” This is unfortunately where the cross-section of the business of medicine and patient care comes in to play, and the repercussions could not have come at a worse time. Ultimately, this in many instances has left health care workers without proper equipment, hospitals without a necessary emergency care plan, and many now at risk of losing their jobs at a time when they are needed most.
Joshua Mansour, MD, is a Los Angeles-based hematologist/oncologist who specializes in bone marrow transplantation and cellular immunotherapy.
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