COVID-19 Could Create Losses of $15 Billion for Primary Care Practices

June 26, 2020
Allison Inserro
Allison Inserro

A report, to appear in the September 2020 Health Affairs, says the losses could be higher, as much as $18 billion, if there is a second wave of infection in the fall or telehealth regulations eased at the start of the pandemic do not continue.

Collectively, primary care practices are slated to lose $15 billion in the United States because of the coronavirus disease 2019 (COVID-19) pandemic, and that figure could reach $18 billion if eased telehealth regulations are not retained, according to a study slated to appear in Health Affairs in September.

Another way that the losses will rise is if there is a second wave of infection in the fall and stay-at-home orders, warned the study, which also said that independent practices would be forced to close right as the nation is attempting to cope with a backlog of unmet medical care for chronic conditions such as diabetes and hypertension.

The fallout could affect the health of Americans for years, said the authors. Primary care accounts for over half of the approximately 1 billion office visits provided annually, with more than two-thirds of visits for chronic conditions.

CMS loosened the regulations around telehealth at the beginning of the public health emergency, and the move has proved popular from oncology to primary care. At a recent session of the National Association of ACOs 2020 Virtual Spring Conference, viewers were told to look at the proposed 2021 Medicare Physician Fee Schedule to see which changes might become permanent after the health emergency ends.

Using a microsimulation model, the researchers simulated the impact on operating expenses and revenues of the pandemic on a variety of practices, including national data on primary care utilization, staffing, expenditures, and reimbursements, including telemedicine visits.

They estimated that primary care practices over the course of calendar year 2020 would be expected to lose $67,774 in gross revenue per full-time physician (the difference between 2020 gross revenue with COVID-19 and the anticipated gross revenue if the pandemic had not happened; interquartile range[IQR]: —$80,557 to –$54,990). That works out to $325,000 per typical 5-person practice, the study said.

The study, released ahead of print, was led by researchers in the Blavatnik Institute at Harvard Medical School (HMS), including Sanjay Basu, MD, PhD, director of research and population health at Collective Health and a faculty affiliate in the HMS Center for Primary Care; Russell Phillips, MD, director of the center and professor of global health and social medicine at HMS; and Bruce Landon, MD, MBA, MSc, professor of health care policy at HMS.

They noted that smaller independent practices lack the same access to capital, technical capabilities, or knowledge or have the financial reserves of larger practices owned by health care systems. Over half of the roughly 220,000 primary care physicians are independent.

Traditionally, these practices have not invested in telemedicine capabilities. Although CMS recently said they would reimburse for phone-only visits, there is still a lot of uncertainity around the issue, the researchers said.

“For many primary care practices, particularly those serving the most vulnerable populations, these losses could be catastrophic, with many practices being forced to close,” Basu said in a statement. “This could weaken the US health system dramatically at a time when we need it to be at its strongest.”

Independent primary care practices have yet to receive significant financial help from Congress, the researchers said.

“Our prior work shows that primary care saves lives, and loss of primary care practices will translate to lives lost across the United States,” Phillips said.

The researchers said their findings and the looming growth in primary care use underscores the need for a financial boost to the primary care system.