| The Covid-19 pandemic is exposing the fragility of the way the U.S. pays for health care.
Most working Americans and their employers send money every month to an insurance company, which holds on to it. When they go to the doctor or hospital, medical providers send insurers the bill, collecting the money later on. It all more or less works in normal times when people are going for check-ups, colonoscopies, and ankle sprains.
But normal times are over.
Medical visits for non-Covid care dried up fast when things shut down, as doctors shuttered clinics and people obeyed state orders to avoid non-essential activity. Here’s a look at the drop in outpatient visits in March, courtesy of research from the nonprofit Commonwealth Fund:
A boost in telehealth visits made up some of the gap, but not nearly enough to account for the decline. People are still paying insurance premiums, but without patients coming in for care, that money isn’t reaching doctors. As a result, many physician clinics and other care providers are slashing expenses to keep the doors open.
In response, Congress is sending $100 billion in grants to providers, with more loans available on top of that. That’s roughly equivalent to what the U.S. typically spends in two weeks on care at hospitals, clinics, nursing homes and other medical services. More is likely on the way.
U.S. health reformers have long sought to change the so-called fee-for-service system in which payment is tied to the volume of care delivered, like so many widgets. One alternative gives doctors a steady monthly payment for each patient on their panel, rather than individual reimbursements for each service they deliver.
In California, the Blue Shield plan is even offering to convert some doctors to monthly payment models. With their waiting rooms empty, doctors once reluctant to switch to such a system may now see the appeal.—John Tozzi |