Buried in the recent announcement by the Bureau of Economic Analysis that real gross domestic product (GDP) decreased at an annual rate of 4.8 percent in the first quarter of 2020 was a remarkable fact: Nearly half of the GDP decrease was due to reduced spending on health-care services. You read that correctly — in the middle of the worst pandemic in over a century, and after decades of unrelenting expenditure growth, we spent less on medical care. How can one explain this anomaly?
It is because Americans, in response to government guidance and fear of an unfamiliar pathogen, are putting off medical care — care that is often essential to their health. Both the CDC and the Centers for Medicare and Medicaid Services (CMS) instructed hospitals and outpatient facilities to delay elective procedures and to reschedule all non-urgent ambulatory visits and hospital admissions, in order to preserve medical manpower, hospital beds, ventilators, and personal protective equipment (PPE) for treatment of an expected surge of COVID-19 patients. State and local authorities issued stay-at-home guidelines and travel bans.
Hospitals, health-care providers, and patients have complied. Hernia repairs, hip replacements, colonoscopies, mammograms, and a variety of other common procedures are no longer performed unless urgent need can be demonstrated. Visits to physicians’ offices have plummeted as patients shelter in place and as fear of contracting COVID-19 at a medical facility has taken hold. Primary-care visits have dropped by 50 percent. Visits to specialists are down even more — cardiology, pulmonary medicine, and surgery have declined by about two-thirds; dermatology, otolaryngology, and ophthalmology are down by three quarters or more. Telemedicine has partially offset these declines, but many patients lack the wherewithal for video communications, and most procedures just cannot be done remotely.
But the overwhelming surge of COVID-19 patients requiring hospitalization and ICU care did not materialize. Outside of a few hospitals in a few hotspots, notably New York and a small number of other cities, health-care capacity was not close to being overwhelmed. In fact, many hospitals, forced to suspend elective procedures, are awash in empty beds. The additional bed capacity that New York City assembled was scarcely used — the Javits Center, set up to treat 2,500, is closing, having treated about 1,100 over the past month. The 1,000-bed Navy hospital ship Comfort left New York after having treated only 182 patients.
Faced with empty beds and offices, providers have started to lay off staff. In March, health-care employment declined by 43,000 — a monthly loss not seen in over 30 years. The March job losses were mostly in the offices of dentists, physicians, and other health-care providers. Outpatient-office dismissals continued in April and hospitals have started laying off thousands as well.
The impact of these policies is not limited to the economy. Cancer surgeries and chemotherapy regimens have been delayed or altered, with an uncertain impact on survival. Lower numbers of hospital admissions for heart attacks, strokes, and other grave conditions suggest that people who need urgent attention are staying home for fear of contracting illness at the hospital. That means they are dying at home or suffering disabilities that could have been avoided with proper care.
People are also avoiding important but “routine” outpatient visits to monitor and adjust treatments for chronic conditions, even though unmonitored diabetes and hypertension can deteriorate, leading to life-threatening complications. Some procedures such as cataract surgery and joint replacements, while technically elective, have enormous impact on quality of life. And the fact that a procedure is not emergent does not mean it can be delayed forever. Sooner or later, delayed cancer screening results in disease progression, delayed treatment, and reduced survival.
COVID-19 cases and deaths have been declining, even in hotspots such as New York, and were never very high in large areas of the country. There is ample medical capacity should cases start to rise again. The time has come to ease restrictions on elective and routine care before we do real and lasting damage to people’s health. Lowering health-care spending has long been a policy goal, but this isn’t the way to do it.