For many years now, a lot of smart people have been saying that the United States needs to get its health care costs under control. It’s finally happening, but the results are not pretty.
The Washington Post reported that while the coronavirus is drawing attention, manpower and money to the nation’s hospitals, it also has proven to be a drain on every other service that hospitals provide.
Bizarre as it may seem at a time when people keep abreast of daily infection counts and death rates, the Post said, “The health care industry is suffering a historic collapse in business that is emerging as one of the most powerful forces hurting the U.S. economy and a threat to a potential recovery.”
Perhaps this should not be a surprise, given that this country spends a lot more on health care, as a percentage of its economy, than any other developed nation.
However, when people think of businesses that have been hit hard in recent months, places such as restaurants and retailers come foremost to mind. Those are considered nonessentials, but few people, other than those who work in health care, would have included hospitals and doctors’ offices on that list.
The fault lies with the widespread shutdown of the economy, which wound up including plenty of medical services. Hospitals were ordered around the country to postpone elective surgeries and other procedures in order to preserve resources and personal protective equipment for treating patients with COVID-19. Greenwood Leflore Hospital estimated, while it was limited to providing emergency services only, that the restrictions were costing it $4 million to $5 million a month. Multiply that by thousands, and you’ll get a feel for the impact nationwide. On top of that, dental offices were also told to stop cleaning teeth and doing other non-emergency work, and other doctors stopped seeing all but the most seriously ill patients.
It turns out that the resulting cutbacks in health care spending were the single largest contributor to the decline in the January through March gross domestic product. This was the largest quarterly decline since the Great Recession 12 years ago.
That decline of about 1% actually is misleading, since January and February were normal months, and the shutdown didn’t begin until March. The economic contraction in the April-through-June second quarter is expected to be much worse — most likely at Great Depression levels.
If that forecast is accurate, it means recovery will take time — and that will be a challenge for an impatient public to tolerate.
Hospitals and other health-care providers will get a sense over the next few weeks of how long it will take for business to improve. With a number of states, including Mississippi, allowing health care providers to resume elective procedures, it is a certainty that health care spending will rise from this trend. There are many ways to define “elective procedures,” and patients who have delayed these procedures for several weeks have not healed miraculously. They will eventually seek treatment.
However, many factors could stall a health care recovery. How many patients, for example, will feel comfortable entering a crowded waiting room of sick people? Telemedicine has been used widely in recent weeks, but generally it produces less revenue that an office visit. How will that affect health care profits?
Picketers who object to the slow pace of reopening should do something more economically productive: Go see a couple of doctors.