Volume 4

Happy Wednesday and Happy Pride Month!

In this week’s edition, I’ve included information on: COVID vaccines, the emerging BA4 and BA5 variants, a new Office of Environmental Justice at HHS, Monkeypox, worrisome healthcare economic trends, and deepening concerns about the healthcare workforce.

For deeper dives, click on the hyperlinks in summaries!

1. Vaccines are struggling to keep up with new variants.

The coronavirus is mutating at a rate faster than the development, production, and distribution of newer vaccines which often takes months (and even years). As more potent and immune-resistant variants and subvariants emerge, vaccines aren’t keeping up.

While mRNA vaccines have been extremely effective, other strategies may be needed to control new variants. For example, the new Omicron BA4 and BA5 variants closely trail BA2 and BA2.12.1 subvariants in their predominance by just a few months. As each variant or subvariant emerges, they more easily evade antibodies from prior infections or currently available vaccines. (BA4 and BA5 are demonstrating immune evasion and will likely be the dominant strains by the end of the summer.)

So What’s The Big Deal? We will continue to see breakthrough infections. COVID spreads extremely fast and mutates quickly. It isn’t going anywhere and will be with us for a long time. New vaccine and therapeutic strategies will be needed to control the disease.

So Now What? Get vaccinated and boosted. Despite breakthrough infections, vaccines still remain the best protective measure to reduce infection and the severity of illness.

2. Monkeypox is on the rise. Should you be worried?

On June 4th , the DC Department of Health confirmed its first case of Monkeypox from a resident who recently travelled back from Europe. DC now joins 12 other states with this potentially deadly disease. So far, most cases have been identified in gay or bisexual men; however, a few women and children have also been infected. Now more than a 1000 cases have been identified worldwide with undetected community spread likely occurring.

So What’s The Big Deal? We are learning more about the severity of this Monkeypox strain. What we know so far is Monkeypox is not COVID19, and scientists have already developed effective vaccines (although production and distribution is needed). However, with the sudden emergence of Monkeypox outside where it’s typically found, healthcare professionals and the public are appropriately concerned.

So Now What? Know the facts about Monkeypox to reduce your risk. Avoid close intimate contact with individuals who have symptoms. Wash your hands and clean surfaces in high traffic areas frequently. And if you develop new skin rashes or unexplained blisters, isolate and alert your healthcare provider.

3. New Office of Environmental Justice

The Department of Health and Human Services (HHS) announced the new creation of the Office of Environmental Justice (OEJ) to cater to health issues associated with the climate. OEJ will be responsible for the development of environmental health strategies to improve clean drinking water and clean air with the hopes of improving the health of those affected communities. Additionally, the office will create an annual environmental justice report highlighting areas of need or where improvements have been made. Some of the first responsibilities of OEJ will be to focus on climate-related health challenges in low-income communities and other vulnerable groups. 

So What’s The Big Deal? A person’s environment affects their health. Period. Many communities with significant healthcare disparities can trace the root causes to environmental factors- like air quality or drinking water. Recognizing the impact that one’s environment has on health is a great step forward to addressing health inequities and other preventable diseases.

So Now What? On June 18th, HHS will start the public comment period to seek input on the OEJ’s implementation.

4. ACA Health Insurance Could Get More Expensive

A significant percentage of Americans across the country may lose their health insurance coverage, under the Affordable Care Act (ACA), as the health insurance premiums are expected to rise before the elections in November. Several Congressional Democrats want to extend the health insurance subsidies, making healthcare insurance more affordable. Conversely, several conservative health-policy leaders and Republicans disfavor the expansion of the ACA owing to an increased burden on federal spending.

So What’s The Big Deal? With a rise in premiums and a potential loss of ACA expansion coverage, out-of-pocket costs for low income American’s could skyrocket. The result could create financial hardships for both patients and reimbursement pressures for providers. With expenses rising and a reimbursement environment worsening, providers could be in for a long, bumpy road.

So Now What? Prepare for healthcare cost shifting with greater costs moving to patients. Patients could also greater difficulty accessing healthcare services if coverage is lost and costs become too high.

5. Health Insurance Companies Have A Stable Financial Outlook

Despite a worsening economic outlook for providers and for the nation at large, according to the Moody’s Investors Service forecast, health insurers can look forward to relative stability this year. The performance improvement is attributed to improved commercial books and strong enrollment growth in Medicaid and Medicare Advantage. However, with the termination of the public health emergency, a 10% decline in Medicaid enrollment is estimated.

So What’s The Big Deal? See #4. Medicaid enrollment increased by 23% due to the public health emergency protections. An end to the public health emergency and/or a lack of Congressional action on ACA premiums could have negative financial impacts on the health insurance market.

So Now What? Congress and the Administration will need to take steps to ensure patients remain enrolled in Medicaid and ACA subsidies continue. If these actions seem unlikely, health insurers and provider need to prepare for a negative financial impact.

6. Should Insurers Focus More on Mental Health?

Individuals suffering from mental health conditions have increased significantly during the pandemic. According to Moody’s, recent studies demonstrate that patients with mental health conditions have 3.5 times the healthcare costs of those without mental health conditions. If insurers can invest in the space and improve the mental health of their beneficiaries, this could be a blooming opportunity for health insurers to reduce overall expenses while addressing mental healthcare. By opening the door to more innovative approaches to mental healthcare, companies could improve access and quality while lowering costs.

So What’s The Big Deal? Since few insurers have fully embraced the idea, there could be a competitive advantage to health insurers in the long run. Focusing on mental health could give insurers a competitive advantage over other insurers who do not. If companies can create solutions to treat mental health meaningfully, costs could be controlled.

So Now What? Business leaders and employees should carefully review their healthcare plan designs. Focusing on and investing in mental healthcare offerings could reduce overall premiums and medical healthcare costs.

7. Hospitals Face a 4th Straight Month of Financial Declines

April is the fourth straight month of financial declines for healthcare systems. While hospital’s enjoyed minor expense relief in March, revenues declined again in April. The decline in revenues is attributed to reduced volume in the emergency departments and overall admissions as more people are seeking care from other healthcare providers.

Organizations are making efforts improve their footing after the winter surge of the Omicron variant. However, with high numbers of resource intensive COVID admissions and labor shortage concerns, expenses have soared. (COVID patients tend to stay in the hospital for longer periods and are relatively more expensive to treat with lower reimbursements.) It’s likely that negative margins remain persistent through the end of the year. 

So What’s The Big Deal? Declining reimbursements by payers, ending the PHE, rising labor costs, inflation, and supply chain disruptions spell bad economic news for hospital systems and providers.

So Now What? Hospitals need to prepare for continued financial challenges over the next few months. Many of the aforementioned structural challenges will not be short-lived. Focusing on greater expense controls were possible (work force, operational efficiencies, etc.) and preparing for possible revenue declines are two possible ways to mitigate any continued downturn. But be careful, see The #10 Big Deal.

8. CVS is Expanding Virtual Health

CVS Health (aka Aetna) announced the start of CVS Health Virtual Primary Care to improve the accessibility to primary care services. In addition to primary care, CVS will also provide virtual mental healthcare, on-demand care, and chronic condition management services. Their system will operate in an electronic interoperable health record which will enable the exchange of patients’ clinical data. Aetna members will have access to the service starting in January 2023.

So What’s The Big Deal? See #6. CVS merged with Aetna in 2018. Targeting mental healthcare with the expansion of telehealth has the potential to drive down overall healthcare costs for Aetna. Other insurers have jumped on the telehealth bandwagon (like UnitedHealthcare and Cigna) with a focus on the primary care telehealth market. CVS makes this a differentiated play by expanding those services to mental health.

So Now What? We need to see if other insurers follow the trend and continue to invest in this telehealth/mental health space or pull back.

9. The Senate Takes Up Expanding Mental Health Access via Telehealth

The COVID pandemic has highlighted the importance of access to mental healthcare services via telehealth. Policymakers have taken notice. Senate Finance Committee floated a “telehealth bill of rights” which includes provisions for virtual mental health services for Medicare beneficiaries. In the proposal, the committee eliminates the requirement for an in-person visit before using virtual mental health services.

So What’s The Big Deal? While the public health emergency could significantly change the telehealth landscape and accessibility, it appears Congress sees the value in telehealth for mental health services.

So Now What? Watch this space closely for two reasons. One, will Congress impose restrictions more closely resembling regulations from the pre-COVID era? Or two, will Congress expand telehealth services with few barriers to care and improved provider reimbursement? The signals may prove important to providers of telehealth services.

10. Healthcare Workers Have Had It

The COVID pandemic has worsened an existing workforce shortage in healthcare. For healthcare providers who remain, many have taken action to organize, demanding improved work conditions, staffing ratios, and compensation. Resident physicians and nurses have been particularly active with some voting to unionize. Others have staged protests, online campaigns, and walkouts. While some hospitals and healthcare systems have responded positively to the demands of workers, others are digging in and resisting.

Legislatively, California, New York and Pennsylvania (among other states) are redoubling efforts to implement nursing staffing ratios - a potential win for nurses and many nursing advocacy organizations. Hospital system operators and hospital advocacy organizations on the other hand are groups who have broadly resisted these efforts.

So What’s The Big Deal? Healthcare workers are burned out, and the healthcare system continues to be in crisis with labor shortages and an unrelenting pandemic.

So Now What? Hospitals and legislatures must take a proactive approach to addressing healthcare workers’ needs. Without improvements, the exodus will worsen, threatening even greater levels of burnout, expense containment, and patient safety.

Thanks for reading the Top 10 Big Deals in Healthcare!

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Have a wonderful rest of the week!

-Dr. N. Adam Brown

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