Volume Forecasting for Healthcare

May 21, 2020

Kyle Kirkpatrick, FACHE, Principal - Consulting Services

Healthcare volume is like a flowing river. Whether the volume is essential or non-essential, the ailments, pains, diseases and illnesses we have are treated by our healthcare system. The COVID-19 pandemic is like a dam put in place in mid-March, 2020 in the United States. What we witnessed was unique – healthcare volume stopped almost instantaneously like a river stopped by an extraordinary dam. The only volume that continued was in hotspots for COVID-19 care and for highly essential services for chronically ill or trauma. Now, we are left guessing how volume will return to normal and what the “new normal” looks like for all of us.

The stoppage when the dam was put in place

We witnessed 50% to 70% of all clinical service line volumes ceasing in mid-March once shelter in place orders went into effect and the nation realized how severe the coronavirus pandemic actually was. Medical and dental offices closed. Telemedicine popped up literally overnight for thousands of medical practices. Hospitals worked tirelessly to build up infection control walls to safeguard patients and staff. Federal stimulus packages were quickly passed to try to keep employees paid even though businesses were closed. And the nation stayed at home. The COVID dam was at full strength.

New upstream tributaries formed

However, rivers always find a way to flow. New healthcare delivery methods formed overnight. Most in healthcare believed that telemedicine was coming, but COVID-19 made it real. With governmental and commercial payors paying for telemedicine visits as a result of the pandemic, providers sprang into action and now provide that service. Telehealth visits are rising. Mail-in prescriptions are growing. Care delivered at home in tandem with tele-visits is viewed as a viable alternative to in-office care. The convenience of home care is so attractive that it will be difficult, if not impossible, to change back to how we received care pre-pandemic. The patient population will demand it and payors will respond. Site of care optimization is a tactic payors have been pursuing for years to decrease costs and improve outcomes using home based care. The COVID-19 pandemic created a paradigm shift causing us to consider how we can receive care at home first before venturing out of our houses. This will have a lasting impact which will generate innovative ways to deliver care based on convenience for patients at home.

Some volume dried up at the dam

Some non-essential volume simply went away, and we won’t know if it will return. Lab tests, routine office visits, and other non-essential care performed “just to make sure” has evaporated. Patients and their families are self-selecting out of care wherever they can right now. This needs more evaluation; however, the U.S. healthcare industry has historically been accused of manufacturing utilization. The pandemic may have created a check on much of that volume where patients are choosing not to proceed. However, we have also heard many stories of people experiencing heart attacks and strokes but not calling paramedics or going to the ER for fear of exposure to the virus. This has resulted in a higher death rate for these conditions due to lack of timely treatment. Accordingly, it is clear that some of this reduced healthcare volume will hurt patients in the long run due to delayed diagnosis and care for urgent conditions. However, it demonstrates the powerful role fear of infection is playing in patients’ decisions regarding whether to seek care.

Holes in the dam

Many healthcare services need to occur with or without a pandemic. Surgical interventions, dialysis, infusions, heart care, asthma treatments, and hundreds of other ailments, injuries, chronic care, or diseases in patients of all ages need attention by professional caregivers, and much of this care cannot be completed contact-free. Surgery or invasive exams like GI screenings are physical interventions that are a required element of effective diagnosis and treatment of a multitude of conditions. Accordingly, holes in the dam are breaking free and will continue to grow as patients stop delaying these important services. Volumes are coming back to some degree.

We have heard theories of the V, the U, the swoosh, and the L shaped volume models for how volume will recover. All of these are pictures on a graph where over time volume has taken a sharp decline and will recover either quickly or slowly. For many “essential” or “non-deferrable” healthcare needs, there was a brief pause on services but they are resuming  quickly.  Elective surgeries have opened up across most states, and infection control protocols have been implemented across healthcare settings. Personal protective equipment is being worn or provided to patients entering healthcare settings, and stringent restrictions on visitors have been adopted to further reduce potential exposure to the virus. These mitigating strategies are either already in place or being quickly established to give patients and families confidence that their healthcare needs can be addressed with minimal fear of contracting COVID-19 when entering a healthcare facility.

For “non-essential” or “deferrable” healthcare volume, the COVID-19 fear of infection will have a much longer staying power. People are choosing telemedicine, remote care, or deferred care for less urgent needs. ER volumes and routine office visits are still down significantly. Although elective surgeries can be performed now that state-mandated restrictions are being lifted, many patients are still choosing to defer them until more is known about the coronavirus. This is occurring at different rates around the country based on virus incidence and differing levels of “opening up the economy.” An elongated swoosh of volumes will likely occur with these types of services, and the top of the swoosh long term is expected to fall short of 100% of pre-pandemic volumes due to telemedicine, at-home services, or patients opting out altogether.

When will the dam break?

Vaccines are in the research and development phase already, with the whole world’s scientific community focused on it. Vaccines typically take two to three decades to develop and deploy. We have lived with HIV in our society with no cure for 35+ years. Herd immunity requires approximately 60% of the population to be immune, which is not realistic any time soon. A global immunization will be necessary to fully break the dam. Hopefully, that will occur within 12 to 18 months given the focus of the international medical community and commitments to fast-track testing, approval, and production.

In this interim time period, essential and non-deferrable volume will build back to expected levels. Non-essential, deferrable, and avoidable care will remain at lower levels for the foreseeable future. Convenience based care like telemedicine and home-based treatments will continue to grow in popularity. Healthcare providers will need to work diligently to create and maintain a safe environment with pristine infection control practices, and educate their patient base on how they are working to protect patients and their families as well as effectively serving their healthcare needs.

The river of healthcare volume continues to flow. While we are currently trapped by the COVID-19 dam, we will see new paths of the river form and grow as a result of this pandemic while waiting on traditional volumes to return. Our hope is that this experience will better prepare us for future crises, create innovative convenient care processes and tools, and improve the way we all do what we love – care for our fellow humans in need.

About the Author

Kyle Kirkpatrick, FACHE Principal - Consulting Services

214.675.3608

kkirkpatrick@jtaylor.com

Kyle is an experienced advisor serving healthcare clients across the country for over 25 years. He can add perspective from his experience as hospital CEO, real estate developer, strategist, financial planner, podcaster, rancher, and beekeeper.