The final installment of our 8-part series culminates with a look at how the COVID-19 pandemic is impacting the operations of the healthcare businesses with which we work.
For an industry that is typically considered a stalwart during market downturns, healthcare providers and their supporting businesses have taken center stage during the pandemic. According to Morgan Stanley, healthcare spending declined at an annual rate of 18% in Q1 of 2020, the largest reduction since the US began recording in 1959, and it is anticipated to be lower for Q2. As health systems across the country have shifted to dealing with COVID and closed their doors to profitable elective procedures, and as patients have minimized visits to providers for routine and other types of care, provider organizations are experiencing significant losses in revenue. These losses have a ripple effect across the entire healthcare ecosystem. In the US especially, where healthcare spending accounts for 18% of GDP, economic recovery of the healthcare industry is crucial not only to the healthcare sector but to the country’s economy as a whole.
In addition to the revenue impact, healthcare providers and health plans as employers are adapting to changes in business operations amidst COVID. In addition to lower utilization of facilities and healthcare services, workforce reduction and remote work practices are commonplace among providers. What does this mean for your businesses that provide the technologies, tools and solutions that support providers and health plans? What shift in strategy is required to effectively support the current and future challenges of the healthcare provider?
Utilization of many services and products has dropped dramatically and will continue to fluctuate.
As lockdowns end and COVID-related illness declines, healthcare providers have begun to bring patients into the their practices and restart profitable procedures. This resumes demand for medications, medical devices and technologies that support these offerings. Elective care was suspended for a significant period, and providers are utilizing creative strategies to re-engage patients for these procedures. The scheduling process and safety concerns will lead to a ramp-up period and new “full capacity” may be only 80-90% of pre-COVID levels. Waiting room traffic management has also emerged as a vital focus area.
What must change in managing client relationships and the type of agreements we have? What current or new solutions can we offer to providers to help them adjust to new volumes, workflows and safety requirements? What technologies can assist to efficiently process patient and procedure backlog?
Sales activity continues but has gone virtual and is focused on a now COVID-impacted market.
Significantly reduced revenues have paused new purchases across the board, although providers are investing in new technologies and services, like telehealth platforms, to support new business operations and care delivery. Digital solutions like telehealth and remote patient monitoring are rapidly becoming entrenched and are likely to be a core component of patient and care management.
How can your business increasingly leverage digital marketing? What different approaches are needed to elevate your product/service above the noise? How should you adapt your product-to-market strategy?
Normal business strategies and financial resilience have been disrupted.
Short- and long-term strategies for healthcare providers and plans have been upended and the pandemic has created a perfect storm. While these organizations have pivoted to focus on servicing COVID patients, they have not yet fully re-imagined a better post-COVID environment. Ambulatory provider groups have been hit disproportionately hard. In April alone 1.4M healthcare jobs were lost – the vast majority from provider group practices. Service and technology vendors who support providers and payers are pivoting to market, sell, install, and service their accounts differently as decision-makers are unavailable for face-to-face support.
What are the best ways to leverage virtual/remote technologies as a part of a long-term business strategy? How does data interoperability play into strategies to efficiently deploy virtual solutions that support patient care? How should we rethink our go-to-market approach given COVID’s differential impact on provider segments?
Large central operations and call centers are moving to formalize remote and work-from-home arrangements.
Many organizations are leveraging the processes established during the initial COVID shut-downs to permanently convert their administrative functions to remote-centric. For obvious reasons, healthcare workers are at the highest risk for exposure, so remote administrative functions have the added advantage of reducing workplace density.
What changes do we keep? What new technologies, tools and operational support do we need for remote operations? Are there new opportunities for partnerships?
As healthcare executives consider the many questions that will surface during and after this pandemic, Commonwealth Health Advisors is working with companies to figure out the answers. We look forward to the opportunity to apply critical thinking, strategic direction and actionable plans to organizations seeking help re-imagining how this pandemic will affect their future, growth and profitability.