Practice Management

COVID-19 pandemic driving huge declines in pediatric service revenue

Pediatric caregivers should consider options



The rapid decline in pediatric hospital visits that came quickly after COVID-19 has emerged as a major public health threat, creating the need for adaptations among those offering hospital-based care, according to an objective look at patient numbers that was presented at the virtual Pediatric Hospital Medicine.

Dr. Magna Dias, Yale New Have Children's Hospital at Bridgeport, Conn.

Dr. Magna Dias

“Pre-COVID, operating margins had already taken a significant decline – and there are lots of different reasons for why this was happening – but a lot of hospitals in the United States were going from seeing about a 5% operating margin to closer to 2% to 3%,” said Magna Dias, MD, medical director, pediatric inpatient services, at Yale New Haven Children’s Hospital, Bridgeport, Conn.

This nearly 50% decline “was already putting pressure on us in the community hospital setting where pediatrics is not necessarily generating a ton of revenue to justify our programs, but post COVID, our operating revenue – and this is a report from May – was down 282%,” Dr. Dias reported.

Dr. Dias said that hundreds of hospitals have furloughed workers in the United States since the pandemic began. Although the job losses are not confined to pediatric care, statistics show that pediatrics is one of the hardest hit specialties.

“Looking specifically at ED [emergency department] visits under age 14, one study showed a 71% to 72% decrease post COVID,” Dr. Dias said. This included a 97% reduction in ED visits for flu and more than an 80% reduction in visits for asthma, otitis media, and nausea or vomiting.

It is not clear when children will return to the hospital in pre-COVID-19 numbers, but it might not be soon if the a second wave of infections follows the first, according to Dr. Dias. She suggested that pediatric hospitalists should be thinking about how to expand their services.

“One thing we are really good at in terms of working in the community hospital is diversification. We are used to working in more than one area and being flexible,” Dr. Dias said. Quoting Charles Darwin, who concluded that adaption to change predicts species survival, Dr. Dias advised pediatric hospitalists to look for new opportunities.

Taking on a broader range of responsibilities will not be a significant leap for many pediatric hospitalists. In a survey conducted several years ago by the American Academy of Pediatrics (AAP), hospital staff pediatricians were associated with activities ranging from work in the neonatal intensive care unit to primary ED coverage, according to Dr. Dias. Now with declining patient volumes on pediatric floors, she foresees an even greater expansion, including the care of young adults.

One organization formed in response to the COVID-19 pandemic, called the Pediatric Overflow Planning Contingency Response Network (POPCoRN) has been taking a lead in guiding the delivery of adult care in a pediatric environment. As a cochair of a community hospital special interest group within POPCoRN, Dr. Dias said she has participated in these discussions.

“At some centers, they have gone from age 18 to 21, some have gone up to age 25, some have gone up to 30 years,” she said.

Many centers are working to leverage telemedicine to reach pediatric patients no longer coming to the hospital, according to Dr. Dias.

“There are a lot of people being very creative in telemedicine,” she said. While it is considered as one way “to keep children at your institution,” Dr. Dias said others are considering how telemedicine might provide new opportunities. For one example, telemedicine might be an opportunity to deliver care in rural hospitals without pediatric services.

In an AAP survey of pediatric hospitalists conducted several years ago, justifying services was listed as the second most important concern right after access to subspecialty support. Due to COVID-19, Dr. Dias expects the order of these concerns to flip. Indeed, she predicted that many pediatric hospitalists are going to need to reassess their programs.

“We have started looking at what are our opportunities for building back revenue as well as how to recession-proof our practices should there be another surge and another decrease in pediatric volume,” Dr. Dias said.

The changes in pediatric care are not confined to the hospital setting. According to Amy H. Porter, MD, assistant professor of pediatrics at the Kaiser Permanente Bernard J. Tyson School of Medicine, Pasadena, Calif., COVID-19 has “changed the way pediatric medicine is being practiced.”

Although she works in outpatient pediatric care, she said that routine care “is way down” in this setting as well. Like Dr. Dias, she has witnessed a major increase in the use of telemedicine to reach pediatric patients, but she is very concerned about the large proportion of children who are missing routine care, including vaccinations.

“We were already seeing outbreaks of whooping cough and measles pre COVID, so we are quite worried that we will see more,” Dr. Porter said.

A reduction in demand for care does not have the same immediate effect on revenue at a large health maintenance organization like Kaiser Permanente, but growing unemployment in the general population will mean fewer HMO members. In turn, this could have an impact on the entire system.

“When membership goes down, then it will have implications for how we can provide services,” Dr. Porter said.

In the meantime, social workers at Kaiser Permanente “are tirelessly working” to help parents losing benefits to obtain medicines for sick children with chronic diseases, according to Dr. Porter. She echoed the comments of Dr. Dias in predicting major changes in pediatric care if the COVID-19 pandemic and its economic consequences persist.

The conference was sponsored by the Society of Hospital Medicine, the American Academy of Pediatrics, and the Academic Pediatric Association.

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