Virtual Health

Transforming Health Systems in Response to COVID-19

By Jiban Khuntia, Ph.D., Associate Professor, Information Systems and Health Administration, & Rulon Stacey, Ph.D., Director of Graduate Programs, Health Administration, University of Colorado Denver
How can health systems drive economic recovery in a COVID-19 transformed situation?

This question puzzled us as we interacted with the leaders of several health systems during the COVID-19 pandemic. The sincere effort of health systems to respond to the crisis was uniformly evident, with a few incrementally different examples. Some health systems relied solely on their Incident Command Center to manage, while others added new teams and eliminated services. All health systems in the country activated their emergency plans, canceled elective procedures, patient visits, and non-essential activities while creating a meaningful response to the pandemic. If not all, most health systems moved their non-clinical employees to work from home using remote and virtual communication tools.

Jiban Khuntia, Ph.D., Associate Professor, Information Systems and Health Administration, University of Colorado Denver
 Jiban Khuntia

While global supply chains faltered, many systems faced a shortage of personal protective gear and other essential supplies, and many operational processes had to be redesigned. Redesigns included placing the IV pumps and patient-room communication equipment on the corridors to minimize patient room visits. Hospitals also enacted immediate patient isolation upon entering the emergency room, creating a tent within the hospital or hospital grounds for the patient and staff recovery.

Health systems need to rebuild their economic strength, faced with financial devastation due to lost revenue and operating inefficiencies. The “restart” of businesses that health systems are planning will include returning elective and non-emergent procedures, preparing for a possible second wave of COVID-19 in the fall of 2020, monitoring impacts on patients, employee needs, and working to address the financial recovery. Taking advantage of the “new normal” will have a prolonged impact on a health system’s ability to deliver quality care in a financially sustainable way. However, this will rely on addressing four priorities that we recommend next.

  1. Align Business Models to Leverage Increased Use of Telehealth: Healthcare has seen a dramatic surge in the use of telehealth and virtual care models from 40-50 visits per day just before the pandemic to upwards of 10,000 visits per day. Successful health systems will work to leverage this seismic change fully. Along with a change in patient attitude towards telehealth, we’ve seen a shift from providers and payers as well. Most private and government health payers have started reimbursing telehealth visits, and several waived co-payments associated with these visits. 

Providers are getting insight into patients’ home environments using telehealth models and are better positioned to suggest remedies to improve that environment. This process enables the patient-centric model, which ultimately empowers patients. Health systems that understand and develop these new models of care beyond the pandemic will impact their financial solvency, and by association, the country’s economic vitality.

  • Electronic Delivery Models for Drugs and Medications to Patients: As a result of the pandemic, mail-in order utilization for drugs and medicine increased by 21% from last year and has a share of up to 5.8% of the prescription drug market share. Mail-in orders reduce cost over the general retail pharmacy, increase medication adherence and the efficiency of medication delivery while lowering the over cost to fill prescription orders. These methods of delivery have gained momentum and need to be leveraged further in the post-pandemic market.
  • Sustain Work-From-Home Models to Reduce Capital and Operational Expenditures: Several health systems have moved thousands of their employees to work from home, allowing health systems to terminate leases for workspaces, eliminate or sell owned real estate, and convert existing administrative spaces to clinical spaces. This shift’s benefits include flexibility in work, employee safety, and access to an expanded and geographically dispersed talent pool. Aligned with the telehealth models described in #1 above, work from home models allow many clinical activities to be done from home. Health systems’ plans may involve sustaining and extending these options permanently to save high cost in capital and operational expenditures for facilities and buildings.
  • Use Intelligent Applications: Artificial intelligence, machine learning, and data-driven predictive models have also played an increasing role during the pandemic, predicting the current prevalence or a possible second wave in late 2020. If health systems strengthen the surveillance of population-wide indicators and intelligence approaches, they may curb another pandemic and possibly avoid another clinical and financial disaster. Health systems can monitor any surge of infection and supplement that information with the existing approaches which failed to capture the original emergence of COVID-19. Using these solutions, health systems can effectively browse through volumes of ambulatory, emergency, and other provider communications, monitor in real-time for structured and unstructured indicators for public health disease surveillance; and ultimately contribute to the National Syndromic Surveillance Program of CDC.
Conclusion: Transform to Align Value than Volumes

Lessons from the COVID-19 pandemic should lead us to transform the delivery of healthcare in the United States. The current legacy fee-for-service business model that healthcare follows has failed under the stress of COVID-19. With hospitals and patients purposefully decreasing admissions and avoidable ER utilization, we saw a dramatic reduction in revenue. The need to transition to value-based payment models is well pronounced but has mostly been limited to pilot to modest efforts. Rewarding wellness, prevention, population health, and providing incentives driving alignment between value and reimbursement rather than increased procedures would change the care delivery model. Without this transformation, volume over the value will prevail for health systems to make them vulnerable to financial issues in another pandemic, like COVID-19.

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