With the introduction of vaccines, the well being business is on the trail to restoration
While the pandemic was a financial catastrophe for some sectors, the healthcare sector was still posting good revenues and profits, even if it was not at the levels projected for last year.
Although the pandemic left hospitals in the region and around the world supernaturally busy, it also shut down some of their more profitable businesses. Now that vaccines are readily available and the number of COVID cases is falling, things are looking good.
In Houston, where the industry employs hundreds of thousands of workers, unemployment has returned to pre-pandemic levels as patients return to medical procedures they’ve been postponing for months.
Revenues for most of the hospital chains in the area remained high, falling at the start of the pandemic before returning to a steady stream of income. The boom from the CARES Act and Provider Relief Fund has also helped.
“Most hospitals had positive margins because the government stepped in to cover them,” said Vivian Ho, health economist at Rice University’s Baker Institute of Public Policy.
New technologies changed the way health care was delivered during the pandemic. Telemedicine made up a large portion of the services offered last year compared to just a fraction before, said James Langabeer, professor of emergency medicine and biomedical informatics at UTHealth.
“The next 12 months will be about figuring out how to work in this new model where telehealth is 20 (percent) to 25 percent of our business,” Langabeer said.
The rise in remote working for administrative staff also means rethinking the physical footprint of doctor’s offices.
However, doctors who run their own practices have different challenges. While government aid helped some keep their doors open, others received little to no money to stay afloat.
Dr. Gary Sheppard, president of the Harris County Medical Society, has heard of hundreds of independent practitioners who closed in Houston during the pandemic. Whether he decided to retire early or didn’t have the capital to pay the rent, turn on the lights, and order medical care, he doesn’t think these doctors will be coming back.
Those that are left should be able to recover by the end of the year.
“I expect things to get better, although the slowdown in people receiving their vaccines is worrying,” Sheppard said. “But in theory things should get better as the year goes on.”
Services such as pediatric vaccinations, colonoscopies, mammograms, and Pap smears all fell significantly in 2020, and the onslaught of patients taking preventive care will help increase revenue.
How much it will help is uncertain. In a recent statewide survey by the Episcopal Health Foundation, a health policy organization based in Houston, more than half of Texans said they skip health care for cost reasons. With many still struggling to get back into jobs and health insurance during the pandemic, they may not return to preventive care or expensive surgery for a while – one of the greatest sources of income for hospital systems.
Experts expect a shift in the types of jobs in the medical field in the future. Asked: highly skilled nurses to make up for the shortage of general practitioners, respiratory specialists for COVID-19 survivors to manage long-term health effects, and gerontologists to work with the aging baby boomer population.
But the entire industry is ready to recover and thrive in the coming year.
“I’m cautiously optimistic that 2021 will turn out to be much better than anyone would have predicted in terms of operating margins and cash flow,” said Langabeer.