LOS ANGELES, CA - MAY 13: Workers wearing personal protective equipment (PPE) perform drive-up ... [+] COVID-19 testing administered from a car at Mend Urgent Care testing site for the novel coronavirus at the Westfield Fashion Square on May 13, 2020 in the Sherman Oaks neighborhood of Los Angeles, California. A nasopharyngeal swab test kit is utilized at this COVID-19 testing center to determine the viral load and virus count of a patient. Los Angeles County 'safer at home' orders have been extended through August to stop the spread of coronavirus during the worldwide pandemic. (Photo by Kevin Winter/ Getty Images)

Pictures from Italy likely drove many decisions made in the US about how to handle the coronavirus outbreak. Particularly in Lombardy where the outbreak was heaviest initially, Italians descended on local hospitals, quickly overwhelming them, and concentrating the highly contagious virus in these facilities. Subsequent reports from officials in the Italian Health Ministry highlighted a problem in their healthcare system. Italy lacks a robust primary healthcare infrastructure, all but ensuring that a mass influx of acutely ill patients desperately seeking care will have few options but overcrowded and inundated hospitals.

While the US healthcare system has a stronger primary care focus than seen in Italy, the tendency to invest in specialty services with their higher associated costs has driven most of the investment in healthcare services over the last 15 years in this country. It is largely the reason that US healthcare costs are the highest in the world without the commensurate value in terms of key outcome measures like life expectancy. As a result, we have had increasing rates of diabetes, heart disease, obesity and respiratory illnesses, points covered in recent Forbes posts. While we have certainly underinvested in primary care in the US, we have had a primary care network and for many, the primary care physician has been the gatekeeper for access to specialty services. Trips to the emergency room for those of us with insurance are associated with high costs, and urgent care centers have sprung up throughout the country as a mechanism to shield the ER from inappropriate usage. A trip to the hospital as a first line of defense in the US is less likely than might have been true in years past, and certainly presents a picture different from the one seen in Italy.

But it was the frightening pictures of healthcare in Italy that seems to have shaped the US response to COVID-19. No city wanted to have its healthcare system overrun with patients lined up on gurneys in hallways while shell-shocked clinicians tried to navigate through the chaos. While the US couldnt get sufficient supplies to the front lines (e.g. personal protective equipment), the draconian measures taken to blunt the projected spread of the novel coronavirus were intended to protect the very same hospitals that a month later have been laying off staff. Mandatory stay at home and shelter in place orders were issued to stem the tide of the virus, but most importantly, to enable healthcare systems in hard hit areas like New York City to keep from becoming overwhelmed.

So far, most healthcare systems have not been overwhelmed; indeed, many are confronted with empty emergency rooms and empty beds. Some patients with serious, non-COVID-19 illness have apparently not sought medical care when they should have. The fact that the onslaught did not happen is touted by some as proof that the measures local governments have taken to protect their citizens worked. Yet as the nation watches, a decade of economic gains are evaporating, businesses large and small are being brought to their knees, and even healthcare delivery organizations are closing their doors. The despair that is griping the nation is palpable as people shelter in place from an unseen virus and see their ability to provide for themselves and their families evaporating in front of their eyes. Isnt it time to ask whether the success was worth the price?

In the natural world, weaker members of the species are ill-prepared to withstand the onslaught of disease, extreme weather, and other disasters. In the wild, the ill and the young fall victim to predators. It is the stronger members that survive. This dynamic plays out in business as well. Those businesses with weak balance sheets going into a crisis like we are experiencing are ill-prepared to withstand the challenges posed by a pandemic. Hospitals with limited days cash on hand before coronavirus hit are unlikely to survive. A town needs a bank and some healthcare services to survive. Part of that service needs to be geared toward supporting individual responsibility for well-being, and that must include the prevention, diagnosis, and management of chronic disease. Chronic disease increases the likelihood of more serious outcomes associated with COVID-19 in the event one is infected. But the incentives underpinning the current healthcare system are not aligned to systematically address chronic illness.

A fundamental tenet of human behavior is that people do what they are incented to do; they stop or avoid doing the things they are not incented to do. Understanding this tenet is the reason I predicted that DRGs would not bend the cost curve in the mid-1980s, despite CMSs good intentions. Until there is transparency in cost/quality, as well as payment tied to outcomes that matter, we are unlikely to see the fundamental changes we need better health outcomes and lower total cost of care.

Today, the path to a value-based healthcare delivery model is being challenged as unrealistic due to COVID-19. Many systems which have taken on some form of risk are attempting to renegotiate with payers to protect themselves against the impact of the pandemic. No one modeled COVID-19 into their forecasts. Healthcare systems that bet they could lower the cost of care and/or improve outcomes will have a hard time winning that bet in the face of the pandemic. But the problem is not taking on risk but a legacy of highly bureaucratic programs built on a traditional fee for service model. Ironically, those that have assumed more of a capitation model in which they receive a PMPM reimbursement are faring better than those who have dipped their toes in the risk pool as they hold onto the tried and true procedure based fee-for-service model. The experience of coronavirus should be a wake-up call that the future of healthcare and the well-being of the nation depend on our willingness to invest in a new model. What we need is a model that engages both the healthcare system and the patient/consumer in coordinated action over time to achieve better health outcomes at lower total cost of care.

Originally posted here:
Coronavirus Will Pave The Way To A New Healthcare Delivery Model (We Hope) - Forbes