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Covid Is Revealing the Cancerous Underbelly of U.S. Healthcare

This is a syndicated repost courtesy of oftwominds-Charles Hugh Smith. To view original, click here. Reposted with permission.

If you still believe that America’s Sickcare is “the finest in the world” and is endlessly sustainable, please study these three charts and extend the trendlines.

I’ve long been making the distinction between healthcare and sickcare:healthcare is the service provided by frontline operational caregivers (doctors, nurses, aides, technicians, etc.) and sickcare is the financialized system of Big Hospital Corporations, Big Insurers, Big Pharma, etc. and their lobbyists that keep the federal money spigots wide open.

This financialized sickcare system is being consumed by the cancer of greedy profiteering pursued by self-serving insiders. The delivery of healthcare is secondary to maximizing revenues and profits by any means available.

To believe such a corrupt system is sustainable is magical thinking at its most destructive.

Covid-19 is revealing this cancerous underbelly. Knowledge of the inner workings of corporate administration is not evenly distributed, so every participants’ experience of the systemic dysfunction will vary.

Here is one MD’s observations of the system’s priorities. Others may have different views but the maxim follow the money is clearly the correct place to start any inquiry of how America’s financialized sickcare functions in the real world.

From what I’m hearing from the front line, a not insignificant number of admissions are of folks who would not have been admitted in March when there was fear of both the unknown and systemic failure and, not coincidently, when COVID diagnoses didn’t pay as much.

Today, the admission criteria for COVID is so much more flexible than for standard diagnoses like CHF, and pays so much better than other diagnoses that our ‘healthcare’ system is rapidly becoming a ‘COVID care’ system.

The surge in hospitalizations and subsequent COVID-identified deaths may be driven, in part, to health systems adapting to new COVID revenue streams.

This would seemingly be good news, after all if it’s the hospital administrator’s desire to fill empty beds that’s driving admissions rather than infection rates, then systemic failure can be averted through moderating those admission rates based on system capacity.

If your hospital fills up, just start sending the marginal cases home–inpatient/outpatient; the outcome for the patient will be pretty much the same and you’ve made as much money as your capacity will allow.

Unfortunately, our healthcare ‘system’ doesn’t work like that.

Health systems are in the business of generating revenue, not value. Recent COVID-related demand destruction has crushed that revenue so they’re hungry for more.

Those in health-system operations and those in leadership live in two different worlds. Leadership will push COVID admissions far beyond any operational limits in their quest for short term performance. One cannot overstate their mendacity and drive for lucre.

Hospitals are becoming ‘COVID factories’ with all other admissions (which pay far less) relegated to second tier status.

Health systems are evolving into an ‘all COVID, all the time’ format with the emphasis on testing and (soon) vaccination, at the expense of all else.

Not a few systems of my acquaintance are laying off outpatient medical staff because their supporting personnel have quit and are not replaced–those resources are being re-directed to COVID testing and in preparation for mass vaccination.

For the health system in the business of generating revenue, it’s an excellent tactic. They save themselves significant overhead by not paying the clinicians and they make up the revenue through high-margin COVID services and government bailout payments.

For patients who actually need healthcare, though, this tactic is deadly.

The perversion is end-stage, the health systems pretend to deliver healthcare and the government pays them to continue the pretense.

There is no long term thinking here, no empathy for the workforce, no thought to the mission beyond window-dressing–just a relentless, risk-adverse financialization machine.

Think of COVID as a new widget for which the customer will pay 2.5 times the going price with no quality control, but only for a limited amount of time. Add in talentless, rent-seeking leadership and all becomes clear.

Of course the real risk is that maxed out hospitals could find themselves in a situation where admissions suddenly become driven by demand rather than the business model, with a true non-linear path to failure laying beyond.

The longer daily national hospital occupancy stays above the approximate pre-COVID capacity of 100k, the more likely you’ll see systemic breakdowns–local at first, then regional.

You won’t see it in the press, the healthcare cartels have a pretty good lock on the local media. Once news starts getting censored on social media, though, then you know it’s happening.

Hold me to that, And call me out in three months if I’m not right.

If you still believe that America’s sickcare is “the finest in the world” and is endlessly sustainable, please study these three charts and extend the trendlines.

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Wall Street Examiner Disclosure: Lee Adler, The Wall Street Examiner reposts third party content with the permission of the publisher. The opinions expressed in these reposts are not those of the Wall Street Examiner or Lee Adler, unless authored by me, under my byline. I curate posts here on the basis of whether they represent an interesting and logical point of view, that may or may not agree with my own views. Some of the content includes the original publisher's promotional messages. No endorsement of such content is either expressed or implied by posting the content. All items published here are matters of information and opinion, and are neither intended as, nor should you construe it as, individual investment advice. Do your own due diligence when considering the offerings of information providers, or considering any investment.

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