Study: Primary care practices could lose $15B in 2020 due to COVID-19

Doctor's office
A new study estimates that primary care practices could overall lose $15 billion this year due to the pandemic, but that could double if telehealth payments go away. (Pixabay)

It will take $15.1 billion to offset the losses primary care doctors have experienced this year due to the COVID-19 pandemic, a new study finds.

The study published Friday in the journal Health Affairs said that price tag could more than double if flexibility on telehealth payments are not continued. Practices have been slammed by low patient volumes due to the pandemic.

“Due to the novel coronavirus disease, virtually all in-person outpatient visits were canceled in many parts of the country between February and May 2020,” the study said.

Research

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The study employed a model that simulated primary care use, staffing, expenditures and reimbursements for primary care practices.

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Researchers estimated that each primary care practice would lose $67,774 in gross revenue thanks to the impact of the pandemic on Medicare fee-for-service payments.

A physician will lose $57,190 in net revenue in 2020 if they keep their pre-existing costs, but that number shrinks to $28,265 if the practice furloughed staff or reduced salaries and benefits.

But a big unknown for practices is telehealth. Primary care physicians largely pivoted to telehealth as patients became afraid to go to the physical office.

The Trump administration also gave providers more flexibility to get reimbursement for telehealth from Medicare and some private insurers are also now reimbursing for telehealth visits.

Researchers assumed that payment policies for telehealth, including flexibility from the federal government, would stay in place through the end of the year.

But a major question mark for physicians is whether telehealth visits “are able to replace the revenue of in-person visits and support the existing staff of primary care practices.”

In addition, many primary care practices have not invested in telemedicine capabilities and could lack the knowledge to implement a telemedicine system in the near term, the study said.

Researchers estimated what happens if telehealth payments reverted back to pre-COVID-19 levels starting on Oct. 1.

Under this scenario, primary care practices over 2020 would lose $173,453 in gross revenue and overall a loss of $38.7 billion in gross revenue.

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The model relied on data from the Medical Group Management Association on primary care visit volume, staffing and revenue. It also looked at a Commonwealth Fund study on the use of telehealth in physician practices since the onset of the pandemic.

There are some major caveats to the study’s model. For example, it did not account for changes in the payer mix that could result from massive unemployment leading people to shift from commercial plans to Medicaid, which pays less.

Another factor could be unexpected costs for additional personal protective equipment and infection control practices.

Researchers said that at some point in the future the disruption created by the pandemic will ebb.

“Looking forward to that time, it will be crucial that the U.S. have a functioning primary care system to meet the pent up needs of the population,” the study said. “It is important to understand the potential impacts on primary care and to consider potential mitigation strategies that will maintain and even strengthen the primary care system.”

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