The Politics and Economics of Resuming Orthopedic Surgeries

Orthopedic surgeons, patients and device companies want to know when elective surgeries will be resumed.

American Academy of Orthopaedic Surgeons President Joseph A. Bosco, III (Joe), M.D., told Academy (AAOS) members on April 13 that while it appears the curve of new coronavirus infections is flattening, no one knows when elective surgeries will resume. The following day the Academy sent a letter to congressional leaders asking for more financial help for the orthopedic community. More on that below.

Timing of Resumption

A few days ago, we reported that institutional investors were calibrating when elective surgeries will start coming back. The consensus was that about 50% will be back on schedule by the end of May and that the remainder will work their way back over the ensuring 60 days. “Assuming, and this is a massive assumption, that strong mitigation efforts remain in place wherever COVID-19 exists, then the risk of a strong second wave—strong enough to disrupt this timeline—is low. A lot is riding on what happens at the Federal level,” wrote our publisher.

Earlier in the month the Institute for Health Metrics and Evaluation predicted there will be rolling COVID-19 peak between April 15 and May 22. Some elective surgeries could be back on schedule by May 23.

Governors and state legislatures will determine the schedules for allowing elective surgeries to return, despite the President’s constitutionally injurious claim of absolute authority in making that decision. States will also define what constitutes an elective surgery. At this point many states have adopted the Centers for Medicare and Medicaid Services (CMS) definition of elective surgery and which surgeries should be postponed.

CMS recommends three tiers of postponements.

• Tier one is the “postpone surgery” category and includes procedures such as carpal tunnel release, EGD (esophagogastroduodenoscopy), colonoscopy and cataracts.
• Tier two is the “consider postpone surgery” category and includes low-risk cancer and non-urgent spine and ortho (including hip, knee replacement and elective spine) surgery.
• Tier three is the “do not postpone” category and includes most cancers, neurosurgery, highly symptomatic patients, transplants, trauma, cardiac with symptoms and limb threatening vascular surgery.

Dental procedures were specifically targeted due to their use PPE and have one of the highest risks of transmission due to the close proximity of the healthcare provider to the patient. CMS is recommending that all non-essential dental exams and procedures be postponed until further notice.

The Administration controls the purse strings of Medicare and Medicaid, so CMS’ participation will be required if surgeons want Medicare and Medicaid reimbursements.

Bosco has assembled a small task force of AAOS Board members which included Drs. Daniel Guy, Felix Savoie, James Ficke and Alex Vaccaro to create a comprehensive guide to help members determine what constitutes elective surgery.

At the States

The independence of governors is demonstrated by Oregon Governor Kate Brown who said when a state restriction is loosened, it will be studied for two weeks to make sure there is no uptick in coronavirus cases. But she also said she will not adopt a federal proposal to wait two weeks without a COVID-19 death in the state. Instead, she said she will watch for falling numbers of cases and hospitalizations.

The governors of California, Washington and Oregon have agreed to a set of principles as they build out a plan to “restart public life and business.” Governors in the New England region have announced a similar measure.

New York Governor Andrew Cuomo has threatened to go to court to prevent the Administration from interfering in the state’s power to determine when elective surgeries return.

The Ambulatory Surgical Center Association (ASCA), is tracking official state mandates regarding elective procedures. To date, according to ASCA, 35 states and Washington, DC have released official statements and directives.

Most states say the prohibition against elective surgeries will remain in effect as long as their state is in an official state of emergency. For the first time in American history, every state is in such a state.

However, some states specified when orders to prohibit surgeries expire.

State

April 24

Source: RRY Publications LLC

To check out your state’s elective surgery policy, click here.

The Economic Hit

Resuming elective surgeries is not only important for patients, but also for surgeons and hospitals where elective surgeries are a money-maker. According to the Arizona Hospital and Healthcare Association, about half a billion dollars a month, or 40% of hospital revenue has been eliminated by the postponements.

For private practices, the percentage can even higher. That’s why AAOS and several other orthopedic organizations are lobbying Congress for more help in a fourth relief package being negotiated in Congress.

Bosco wrote that compliance with CMS guidance to postpone elective surgeries are leading directly to “plummeting case volumes, with practices struggling to stay in business and keep their employees on staff.” He said the orthopedic community is concerned that too many private practices will have become “financially insolvent, threatening access to care.”

He cited a recent AAOS survey (AAOS COVID-19 Advocacy survey, preliminary results as yet unpublished-2020) which showed more than a third of orthopedic surgery practices reported financial impact totaling over $1 million. “The average number of surgeries cancelled or indefinitely postponed totaled 150 per respondent, while nearly half of respondents noted a decline in volume of 80% or more.”

“Over half of the members of the AAOS are in private practice, with each orthopaedic surgeon performing on average nearly 36 procedures per month,” wrote Bosco. “The capacity of these surgical practices to stay open and manage the expected influx of need following this crisis will correspond directly to how quickly Americans can get back to work and help the economy recover.”

Canaccord Genuity Analyst Kyle Rose surveyed 50 orthopedic/spine surgeons to assess COVID-19’s impact on treatment and practice viability. A majority of respondents reported that even before the mandated bans on elective surgeries their practices had already decided to defer or postpone all procedures. Nearly a third of respondents indicated that “over 90% of their entire practice was deferrable.”   (https://ryortho.com/breaking/survey-of-orthopedic-spine-surgeons-during-covid-19/)

Procedure postponements have had a huge effect on patient volume. Respondents to the Canaccord survey indicated a “58% average decline in March and an anticipated 77% average decline in April.”

Those surveyed also predicted a dramatic rise in future procedure volume with “41% expecting to ‘catch-up’ on procedure volumes within three months and another 35% within six months.” So, while the first two quarters of the year will be depressed, the last two quarters might see unprecedented numbers.

Bosco’s Plea

Now for the orthopedic community’s plea to Congress.

Small private practices are already receiving some financial support from the Coronavirus Aid, Relief, and Economic Security (CARES) Act.

But the orthopedic groups say that support may not be enough to “maintain this critical resource for safeguarding the nation’s musculoskeletal health.” Their letter outlined specific provisions for Congress to consider in the fourth COVID-19 stimulus package currently under consideration, including the prioritization of funds for physician practices at risk of closing and blanket liability protections for volunteers, among others.

The new bipartisan stimulus package, according to Bosco, will likely double the $100 billion for providers (including hospitals and physicians) in the CARES Act.

Specifically, the orthopedic medical community is asking Congress for:

• Prioritize relief provided within CARES for physician practices in communities at risk of losing access to needed musculoskeletal care should those practices be unable to remain open.
• Extend the recoupment deadline in the Medicare accelerated payments program to December 31, 2021 and clarify the tax liability for recipients.
• Include the Immediate Relief for Rural Facilities and Providers Act, introduced by Senator Michael Bennet (D-CO) and Senator John Barrasso, M.D. (R-WY).
• Expand eligibility within the Paycheck Protection Program for physician practices with over 500 employees.
• Add blanket liability protections for physicians who are working outside their normal practice area in order to provide surge capacity but not volunteering.
• Ensure physicians, healthcare workers, and first responders are included and covered under the paid sick leave provisions instituted by the Families First Coronavirus Response Act.

“The historic challenge of the COVID-19 pandemic requires an equally historic response from Congress,” said Bosco in his letter to Congress. “We thank you for your work in this fast-moving crisis environment and ask that you take these steps to ensure orthopaedic surgeons are best equipped to help get the nation through this and provide care when this crisis is over.”