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Reopening Doctors’ Offices Costs Billions to Keep Patients Safe

May 27, 2020, 9:45 AM

The nation’s doctors are cautiously looking to reopen their shuttered practices in the midst of the Covid-19 pandemic. But they want at least $10 billion in dedicated federal assistance to help them get back on their feet.

New procedures to ensure patient safety will need to be implemented before practices can start treating patients again, which could put doctors at increased risk for noncompliance. Failure to meet federal, state, and local health and safety guidelines could lead to monetary penalties, license suspensions, revocations, and other possible sanctions. It could also create liability problems if doctors are alleged to have breached required standards of care.

“You’re faced with a situation where you have patients that haven’t been seen,” said Kerin Bashaw, senior vice president of patient safety and risk management at the Doctors Company, the nation’s largest physician-owned medical malpractice insurer. “You had to switch to telemedicine. You’ve had to completely change. Now you have to go back into your office, and the processes that you need to go through to reopen are significant and overwhelming.”

These processes include updating staffing and office operations, instituting new safety and training protocols, securing adequate supplies of protective gear, developing triage plans for patients, and staying abreast of federal, state, and local requirements. “They literally need to go in and look at the CDC website every day,” Bashaw said.

The new requirements will make it even tougher for hard-hit practices to resume patient visits now that employee testing, enhanced facility cleaning, and higher-cost protective gear have become new fixed costs in the Covid-19 era.

Primary Care Halted

The outbreak forced physician practices and medical offices to close or greatly reduce office visits due to infection fears and the resulting slowdown in nonemergency care.

Despite a surge in telemedicine appointments, outpatient office visits are still down by roughly one-third from pre-pandemic levels, the Commonwealth Fund estimates. Without a jolt of direct funding for primary care providers, groups like the American College of Physicians say some practices won’t be around to resume office visits.

“We have had physicians who have said, ‘You know what? I’m closing shop.’ I don’t count on that, but it’s more than we normally get,” Bashaw said.

The American College of Physicians is urging the Department of Health and Human Services to cover 80% of losses incurred by primary care practices for the rest of the year. The group wants about $10 billion from the CARES Act Provider Relief Fund directed specifically to primary care physicians. Others want even more.

“$15 billion would be enough to provide immediate relief to these practices and make sure they could survive,” said Farzad Mostashari, co-founder and CEO of Aledade, which helps independent primary-care practices transition to value-based payment contracts. “We need to throw these practices a lifeline right now,” he said at a May 20 media briefing hosted by the Commonwealth Fund.

The HHS said it has distributed $50 billion in general relief funds to Medicare hospitals and providers that were affected by the pandemic. Many primary-care practices received some payments as a part of those first outlays, but the amounts varied widely. To date, there hasn’t been a dedicated pot of money for those facilities.

Some $27 billion also has been distributed to hospitals that admitted at least 100 Covid-19 patients, rural hospitals and health clinics, nursing facilities, and Indian Health Service facilities. The administration will also reimburse medical providers who take care of uninsured Covid-19 patients.

Dedicated Funding Needed

Primary-care physicians deserve a “similar” dedicated funding amount as rural providers, ACP President Jacqueline W. Fincher said in a May 19 letter to HHS Secretary Alex Azar.

The situation has already pushed many practices to the brink, forcing staff layoffs and furloughs as revenue craters. A new national survey by the Primary Care Collaborative found 60% of providers reported continued declines in patient volume, 59% had no protective gear, and 51% reported little or no access to Covid-19 testing.

Even practices that have additional resources will face challenges because social distancing will limit the number of patients in office waiting rooms, said Ateev Mehrotra, associate professor of health-care policy and medicine at Harvard Medical School.

“The number of patients you’re actually going to be able to see in an hour or in a day is going to be much lower,” even though fixed costs are increasing, Mehrotra said during the May 20 briefing.

Restart Loan Program

The nation’s doctors also want the Trump administration to restart Medicare’s Advance Payment Program, which provided at least $40 billion in loans to more than 24,000 doctors and durable medical equipment suppliers during the pandemic. The program was suspended on April 26 by the Centers for Medicare & Medicaid Services.

The CMS explained its move by saying that “significant additional funding” for hospitals, doctors, and other front-line responders was available through the relief fund. The agency also noted that Congress provided $75 billion through the Paycheck Protection Program and Health Care Enhancement Act, which physicians can also apply for.

On May 18, the American Medical Group Association, whose member organizations represent 175,000 physicians, offered its support for House and Senate proposals to restart the Medicare loan program.

Legislation introduced by Rep. Bradley Scott Schneider (D-Ill.), H.R. 6837, would also delay recoupment of the Medicare loans, lower their interest rates, and allow loan forgiveness in instances of extreme hardship. Sen. Jeanne Shaheen (D-N.H.) is sponsoring companion legislation, S. 3750, in the Senate.

—With assistance from Shira Stein

To contact the reporter on this story: Tony Pugh in Washington at tpugh@bloomberglaw.com

To contact the editors responsible for this story: Fawn Johnson at fjohnson@bloomberglaw.com; Brent Bierman at bbierman@bloomberglaw.com

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