$100B in relief is not enough says association representing musculoskeletal providers

A trade group representing musculoskeletal providers ask Congress for more help predicting insolvency for many members, while a separate hospital financial analysis shows that their net losses will exceed the $100 billion stimulus package within 16 weeks into the Covid-19 crisis.

A national advocacy group representing musculoskeletal (MSK) providers has sent a letter to Congress appealing for more relief to counter the effects of Covid-19.

The American Association of Orthopaedic Surgeons (AAOS) — joined by  Alabama Orthopaedic Society, American Association for Hand Surgery, American Association of Hip and Knee Surgeons American Orthopaedic Foot & Ankle Society and Arizona Orthopaedic Society and others — say that members have complied with federal guidance to halt and postpone elective surgeries but there is an imminent danger of them going bankrupt by the time elective procedures restart again. Hip and knee replacements are an example of MSK procedures.

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“As the pandemic becomes more manageable and these surgeries can take place, we are concerned that too many of our private practices will have become financially insolvent, threatening access to care,” wrote Dr. Joseph A. Bosco, III, MD, president of AAOS in a letter to Senate leader Mitch McConnell (R-Kentucky) and House Speaker Nancy Pelosi.” While we commend Congress for providing relief in the Coronavirus Aid, Relief, and Economic Security Act (CARES), that support may not be enough to maintain this crucial resource.”

The relief refers to $100 billion in the CARES Act reserved for healthcare-related expenses or lost revenue due to Covid-19. The initial payment of $30 billion began Friday, according to the Department of Health and Human Services.

According to a 2015 study, the U.S. has a high incidence of joint replacement procedures with more than 1 million such procedures performed each year.

In the letter, Bosco cited that a recent survey of its membership – the results of which are not available because it is ongoing — shows that nearly half of AAOS members have reported a decline in procedures by a whopping 80 percent. Nearly a third have suffered revenue loss totaling more than $1 million. Half of AAOS’ members are in private practice and perform on average 36 procedures a month, the letter said.

Bosco recommended that Congressional leadership consider the following steps to shore up these practices when legislators debate another relief package:

  • Direct the Department of Health and Human Services (HHS) and Department of the Treasury to 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.
  • Direct CMS to extend the recoupment deadline in the Medicare accelerated payments program provided for in CARES to December 31, 2021, to allow for loan forgiveness for providers and facilities that cannot afford repayment at that date, and to clarify the tax liability for recipients. Without this extension, many orthopaedic practices have reported the accelerated payment program will not provide the intended relief.
  • Include the Immediate Relief for Rural Facilities and Providers Act, introduced by Senator Michael Bennet (D-CO) and Senator John Barrasso, MD (R-WY) to extend a critical lifeline to physicians and facilities most at risk of closing their doors.
  • Expand eligibility within the Paycheck Protection Program for physician practices with over 500 employees who desperately need access to forgivable loan programs in order to maintain staff.
  • Add blanket liability protections for physicians who are working outside their normal practice area in order to provide surge capacity but not volunteering and therefore not covered by the “good Samaritan” language in CARES.
  • 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.

AAOS isnt the only group sounding the alarm. A report published by consulting firm BCG last week entitled, “COVID-19 Is Stressing the Finances of Even the Strongest US Health Systems” found that even before the crisis many “health systems were already struggling to maintain viability, operating with single-digit margins, a lack of significant reserves, limited debt capacity, and low occupancy.”

The report’s authors predicted that given this context, “20% of health care capacity is at a near-term risk of insolvency.”

And more ominously, they added:

“Our analysis finds that net revenue losses for hospitals will exceed the $100 billion stimulus amount within 16 weeks into the Covid-19 crisis. The expected capital expense for ventilators alone represents approximately 5% to 15% of the total relief package.”

Photo: Baris-Ozer, Getty Images