Balancing revenue generation with capacity generation: Case distribution, financial impact and hospital capacity changes from cancelling or resuming elective surgeries in the US during COVID-19

Abstract

Background: To increase bed capacity and resources, hospitals have postponed elective surgeries, although the financial impact of this decision is unknown. We sought to report elective surgical case distribution, associated gross hospital earnings and regional hospital and intensive care unit (ICU) bed capacity as elective surgical cases are cancelled and then resumed under simulated trends of COVID-19 incidence.

Methods: A retrospective, cohort analysis was performed using insurance claims from 161 million enrollees from the MarketScan database from January 1, 2008 to December 31,2017. COVID-19 cases were calculated using a generalized Richards model. Centers for Disease Control (CDC) reports on the number of hospitalized and intensive care patients by age were used to estimate the number of cases seen in the ICU, the reduction in elective surgeries and the financial impact of this from historic claims data, using a denominator of all inpatient revenue and outpatient surgeries.

Results: Assuming 5% infection prevalence, cancelling all elective procedures decreases ICU overcapacity from 340% to 270%, but these elective surgical cases contribute 78% (IQR 74, 80) (1.1 trillion (T) US dollars) to inpatient hospital plus outpatient surgical gross earnings per year. Musculoskeletal, circulatory and digestive category elective surgical cases compose 33% ($447B) of total revenue.

Conclusions: Procedures involving the musculoskeletal, cardiovascular and digestive system account for the largest loss of hospital gross earnings when elective surgery is postponed. As hospital bed capacity increases following the COVID-19 pandemic, restoring volume of these elective cases will help maintain revenue.

Keywords: Available hospital beds; COVID-19 pandemic; Critical care capacity; Overcapacity; Resource allocation.

Figure 1.. Average Proportion of Inpatient and ICU Person Days per State Resulting from Elective Surgery.

Data from 161 million Marketscan patients from 2008–2017 displaying aggregated counts of hospital and ICU beds in total and those resulting from elective surgery averaged across all states. For each month.

Figure 2.. Financial contribution of major diagnostic categories (MDC) to gross hospital earnings.

Data from 161 million Marketscan patients from 2008–2017 displaying aggregated gross hospital earnings by surgery type, separated by major diagnostic category (MDC), across the US. Levels are listed in descending order the percentage of each MDC category contributed by elective inpatient cases. Level width is proportional to the absolute value in US dollars.

Figure 3.. Regional variation by state in percentage financial contribution of non-elective, elective inpatient and outpatient surgeries.

Panel A shows percent financial contribution to gross hospital earnings by state for non-elective cases. Panel B shows elective inpatient cases. Panel C shows outpatient cases.

Figure 4.. ICU Capacity across the US with and without cancelling elective surgeries.

Panel A represents the number of ICU patients admitted each day while Panel B represents total ICU patient days during peak infection assuming each COVID-19 patient spent 9 days in the ICU. Green denotes normal availability of ICU beds, purple shows the additive ICU beds that are available when all elective surgeries are cancelled and pink indicates ICU capacity that would have to be generated by adding additional capacity in hospitals beyond what could be generated through cancellation of elective cases. The dotted lines represent estimates of the number of patients admitted into ICUs from the time the first person was infected and modeled for 100 days after this based on a Generalized Richards Growth Model (GRM). The low and high estimates for COVID-19 infection are based on the CDC low and high estimates. Panels C-F: Impact of Cancelling All Elective OR Cases on ICU Bed Availability if 5% of U.S. Population Infected with COVID-19. Estimates of low (Panel C) and high (Panel E) ICU cases are derived the uncertainty estimates from CDC MMWR reports from the CDC COVID-19 Response Team. Additional capacity through cancellation of elective cases (Panel D, Panel F) was determined by applying estimates of the occupied and unoccupied beds resulting from elective surgery from the Marketscan database to the Harvard Global Health Institute (HGHI) estimates of total inpatient and ICU beds in each state.