Transformative impact of inflation on the healthcare sector

February 5, 2023 Vera

The once-in-a-century pandemic thrust the healthcare industry into the teeth of the storm. The combination of accelerating affordability challenges, access issues exacerbated by clinical-staff shortages and COVID-19, and limited population-wide progress on outcomes is ominous. This gathering storm has the potential to reorder the healthcare industry and put nearly half of the profit pools at risk. Those who thrive will tap into the $1 trillion of improvement available by redesigning their organizations for speed-accelerating productivity improvements, reshaping their portfolio, innovating new business models to refashion care, and reallocating constrained resources. The healthcare industry has lagged behind other industries in applying these practices; players who are able to do so in this crisis could set themselves up for success in the coming years. This article is the second in our five-article series addressing the gathering storm.

Consumer prices have rarely risen faster than healthcare inflation, but that’s the situation today. The impact of inflation on the broader economy has driven up input costs in healthcare significantly. Moreover, the likelihood of continued labor shortages in healthcare—even as demand for services continues to rise—means that higher inflation could persist. Our latest analysis estimates that the annual US national health expenditure is likely to be $370 billion higher by 2027 due to the impact of inflation compared with prepandemic projections.

Pressure on healthcare input costs

Healthcare supply input costs spiked in late 2020 and 2021 during the COVID-19 crisis. Labor costs per adjusted hospital discharge grew 25 percent between 2019 and 2022, closely followed by pharmaceuticals at 21 percent, supplies at 18 percent, and services at 16 percent.

While these costs have moderated in 2022, they continue to be above the norm; in particular, growth in labor cost remains high.

Clinical labor

The worsening clinical labor shortage is a significant contributor to our projected increase in healthcare costs over the next five years. By 2025, we expect a gap of 200,000 to 450,000 registered nurses and 50,000 to 80,000 doctors (10 to 20 percent and 6 to 10 percent of the workforce, respectively).

These shortages underpin our estimate that healthcare labor cost growth will outpace inflation. We expect clinical labor cost growth of 6 to 10 percent over the next two years, about three to seven percentage points above the prevailing rate of inflation, before a correction to

What Does a Good Health-Care System Look Like?

December 30, 2022 Vera

I make a good living. I should have a larger retirement portfolio than I do, as my husband and I keep our living expenses within bounds, and I am a moderately successful self-employed professional. However, every few years, or sometimes a few years in a row, I find our household being bankrupted by the medical-industrial complex.

This year has been uniquely devastating. My husband is a 75-year-old bone-cancer survivor. Two years of radical chemotherapy left him with a suppressed immune system, which means for most of the pandemic we’ve been hiding from people the way Gremlins hide from sunlight.

A few years ago he had a two-year bout of C. diff, for which the drugs cost thousands. He finally beat it.

A long-term result of the C. diff left him with bacteria in his teeth and gums, which resulted in him needing $25,000 worth of dental work. He lost his upper teeth, now has upper dentures, and had serious gum work done on all his bottom teeth. Medicare covered a tiny bit of this. Dental work is not considered worthy of proper insurance in this country. And without the dental care he would have developed sepsis and died.

This cost was on top of his Medicare deduction from his Social Security and his $471-per-month drug-plan copay.

We’ve had some truly INCOMPETENT primary-care physicians over the years. We found a great doctor in 2006. He was an independent. Didn’t take insurance. Fee for service. Had studied at Loma Linda hospital. Great credentials. Finally a great primary-care physician. His wife, a Harvard-trained attorney who had retired from the law, ran his practice. Well, with the COVID pandemic, his wife burned out on medical administration, partly from all of the death they had to deal with. And she had a few COVID deaths in her own family. With his wife retiring from medical administration, he joined a boutique primary-care practice starting January 1, 2022. He’s no longer fee-for-service. He went concierge. He takes insurance now. But the annual “concierge fee” for 2022 was $3,000 per patient per year. It is going up to $4,000 per patient for 2023.

Then there are MY medical costs. My insurance is $1,189 per month for second-from-top-level insurance. It goes up 14 percent next year. I have arthritic knees from being a 10-to-15-mile-a-week runner from my late teens to early 30s. At 6 foot 1, I am a

GAO appoints 7 healthcare leaders to HITAC

December 29, 2022 Vera

Seven new healthcare leaders from diverse industry backgrounds will be joining the Health Information Technology Advisory Committee, the federal group working to implement a health IT infrastructure that advances the electronic access, exchange and use of health information in the U.S. healthcare system.

WHY IT MATTERS

Established by the 21st Century Cures Act, HITAC and its subcommittees provide recommendations to the Office of the National Coordinator for Health Information Technology on policies, standards, implementation specifications and certification criteria.

The new members, appointed by the Government Accountability Office, have served healthcare in both public- and private-sector capacities at organizations across the United States.

Dr. Kikelomo Belizaire, the chief medical officer at Pegasystems, is also a practicing hospitalist in the Charlotte, North Carolina, region. She previously served as the medical director of Anthem’s commercial unit and as a physician treating high-acuity patients in several hospital systems in North and South Carolina, and as a healthcare consultant.

Dr. Shila Blend is the health information technology director of the North Dakota Health Information Network, a statewide HIE. She also serves as a subject-matter expert with the Rural Emergency Medical Services Counts project, which is working to develop quality measures for emergency medical services in rural areas. She previously served the state in a number of preparedness and coordination roles, including as the deputy chief of staff for COVID-19 response.

Dr. Hannah Galvin is the chief medical information officer of Cambridge Health Alliance, an academic public safety net health system, where she leads the division of clinical informatics and practices as a pediatrician. She is the co-chair of the board of directors of Shift, an independent task force focused on enabling patients to manage how their health data is shared to promote equitable interoperability. Previously, Galvin was the medical director of informatics at Lahey Health and cared for underserved and vulnerable populations at hospitals in Massachusetts, New Hampshire and Rhode Island.

Dr. Bryant Thomas Karras, the chief medical informatics officer and senior epidemiologist with the Washington State Department of Health, guides informatics and HIE efforts. He has spearheaded state healthcare initiatives, including efforts to increase adoption of health information technology, detect disease outbreaks in their early stages and more. Previously, Karras served as an internal medicine physician at a number of hospitals in Connecticut, Oregon, Washington and Wisconsin.

Anna McCollister is a patient advocate, entrepreneur and advisor on various health technology, data use

The Top 5 Healthcare Trends In 2023

December 27, 2022 Vera

The world is a very different place than it was ten years ago, and nowhere is this more evident than in healthcare. The aftermath of the covid-19 pandemic, combined with the financial downturn and an acceleration in the adoption of technology and digitization, have dramatically changed the landscape for everyone, patient or practitioner.

The Top 5 Healthcare Trends In 2023

Adobe Stock

Here’s my overview of what I believe will be the most important trends of the next 12 months:

Artificial Intelligence in Healthcare

The market for Artificial intelligence (AI) – specifically, machine learning (ML) tools in healthcare is forecast to top $20 million in 2023. Various AI-aligned technologies, such as computer vision, natural language processing, and pattern recognition algorithms, are already deeply embedded in the healthcare ecosystem and will continue to be adopted as evidence of their usefulness grows throughout 2023. Some examples of areas where AI is used include drug discovery, where it can assist with predicting outcomes of clinical trials and potential side effects of new drugs, as well as analysis of medical imagery, which involves using computer vision algorithms to spot early warning signs of disease in x-rays or MRI scans. It has also successfully been used to detect and treat neurological disorders, including Parkinson’s Disease and Alzheimer’s Disease.

Outside of frontline clinical work, AI also has applications in clerical work, such as processing insurance claims and management or analysis of medical record keeping. It can also be used to analyze data collected from patient wearables or in-home sensors used in virtual hospital settings (more on that in my next trend) to provide early warning or predictive diagnosis of various conditions. Put together, all of these use cases indicate that AI and ML will continue to be a prominent trend in healthcare throughout the coming year.

Remote Healthcare – Virtual Hospitals, Healthcare Communities, and Telehealth

Healthcare delivered remotely increased significantly during the pandemic. Even now that it’s generally safe to resume face-to-face routine appointments, many patients and providers have realized that for many conditions, care can be provided more efficiently and cost-effectively at a distance.

Remote healthcare falls into a number of different categories. There is an increase in home-based care driven by evidence that shows that a familiar environment and proximity to a family can have a positive effect on patient outcomes, as well as being hugely cost-efficient compared to inpatient care. Then there is

‘A ticking time bomb’: healthcare under threat across western Europe | Health

December 17, 2022 Vera

For decades, western Europe’s national healthcare systems have been widely touted as among the best in the world.

But an ageing population, more long-term illnesses, a continuing recruitment and retainment crisis plus post-Covid exhaustion have combined, this winter, to create a perfect healthcare storm that is likely to get worse before it gets better.

“All countries of the region face severe problems related to their health and care workforce,” the World Health Organization’s Europe region said in a report earlier this year, warning of potentially dire consequences without urgent government action.

In France, there are fewer doctors now than in 2012. More than 6 million people, including 600,000 with chronic illnesses, do not have a regular GP and 30% of the population does not have adequate access to health services.

In Germany, 35,000 care sector posts were vacant last year, 40% more than a decade ago, while a report this summer said that by 2035 more than a third of all health jobs could be unfilled. Facing unprecedented hospital overcrowding due to “a severe shortage of nurses”, even Finland will need 200,000 new workers by 2030.

In Spain, the health ministry announced in May that more than 700,000 people were waiting for surgery, and 5,000 frontline GPs and paediatricians in Madrid have been on strike for nearly a month in protest at years of underfunding and overwork.

Efforts to replace retiring workers were already “suboptimal”, the WHO Europe report said, but had to now be urgently extended to “improve retention and tackle an expected increase in younger people leaving the workforce due to burnout, ill health and general dissatisfaction”.

In a third of countries in the region, at least 40% of doctors were aged 55 or over, the report said. Even when younger practitioners stayed despite stress, long hours and often low pay, their reluctance to work in remote rural areas or deprived inner cities had created “medical deserts” that were proving almost impossible to fill.

“All of these threats represent a ticking time bomb … likely to lead to poor health outcomes, long waiting times, many preventable deaths and potentially even health system collapse,” warned Hans Kluge, the WHO regional director for Europe.

In some countries the worst shortages are among GPs, with France in particular paying the price for previous planning errors. Back in 1971, it capped the number of second-year medical students through a so-called

Healthcare Boom – Central Florida Health News

November 29, 2022 Vera

AdventHealth to Open New Hospital in Winter Haven; Orlando Health to Expand Into Lakeland

by PAUL CATALA

Healthcare facilities are expanding at an astounding rate to match the population boom and increased need in Central Florida.

AdventHealth is expanding its footprint in Polk County with a new four-story hospital and emergency department off Cypress Gardens Boulevard in Winter Haven. In Lakeland, Orlando Health is expanding, planning a hospital and surrounding campus in the fast-growing South Lakeland area.

This planned construction is further evidence of the growth in Polk County, which expanded from 603,000 residents in 2010 to 753,500 by 2021.

AdventHealth, a Seventh-Day Adventist nonprofit healthcare system headquartered in Altamonte Springs, recently announced its plans for a new, four-story hospital in Winter Haven.

The 42 acres north of Cypress Gardens Boulevard, south of River Lake and west of Cypress Gardens Road will eventually become a medical campus for the 192-bed AdventHealth Winter Haven hospital with an emergency department and 160,000 square feet of medical offices and ancillary facilities.

The AdventHealth expansion plans were given final approval when the Winter Haven City Commission unanimously approved the development November 14.

“The southeast section of Winter Haven is growing in leaps and bounds, and this will make it a lot easier when time is sensitive for medical issues for the citizens to get medical care,” says Winter Haven City Commissioner J.P. Powell.

“It’s necessary. The other alternative was going to Lake Wales or Haines City, and with medical issues. time is of the essence. It will be a real asset.”

According to AdventHealth, the first phase of construction will include a freestanding emergency room that will open before the hospital is completed. Once open, hospital services will include primary care, cardiology, gastroenterology, orthopedic, and urological specialty medical services.

Tim Clark, president and CEO of the AdventHealth Polk Market, has worked at AdventHealth for 19 years in various positions. He started as president and CEO of the Polk Market on June 5. He says the new hospital will bring “whole-person care to residents close to home,” particularly in the southeast section of Winter Haven.

Once completed, the new hospital will be part of a network of AdventHealth centers already operational in areas such as Carrollwood (Tampa), Dade City, Lake Placid, Lake Wales, Sebring, and Wauchula. It will also be among five freestanding offsite AdventHealth emergency rooms, including those in Brandon, Palm Harbor and Tampa’s