1. Our frontline clinical staff were battered and beset—but have emerged more powerful than before.

Christopher Kerns, Vice President, Executive Insights

It's an irony for the ages that during a period in which our frontline clinical staff have never been so battered and beset, they have nonetheless emerged more powerful than ever. At the beginning of the pandemic, physician revenue cratered and frontline nursing and allied staff found themselves overworked, traumatized, and suffering wrenching casualties. Herculean efforts from both the public and private sectors went a long way with support, but the physical, emotional, and financial pain nonetheless has taken its toll on our clinical workforce. But over that same period, constraints on clinical labor supply drove wages up. The pandemic's effects prompted physicians to look seriously at emerging alternatives to independent practices and health system employment, driving up the value of medical groups to record levels. And the deployment of digital health and home-based care provided different-in-kind care delivery options to countless clinical professionals.

Not unlike the victors at the end of the Second World War, our clinical staff—rightly touted as heroes during the worst of the pandemic—may not have emerged unscathed, but they now wield more power and influence on our industry than ever before. How and where they choose to practice medicine in the future will have long-term consequences our industry is only beginning to understand.

2. The pandemic may have actually reduced the risk of a physician shortage.

Rachel Woods, Managing Director, Executive Insights and Host of Radio Advisory Podcast

Headlines about clinician shortages are not new in health care. In fact, we've been hearing about (and debunking) messages of a mass physician shortage for years. But when the pandemic threatened to change everything, our physician researchers watched patiently to see how the Covid-19 crisis would impact our take on physician shortages. 

What's become clear is that the pandemic has not resulted in nor will it accelerate the path to a physician shortage. In fact, it's probably made things better. Now, that's not the case for the U.S. workforce as a whole or even for specific members of the clinical care team (namely bedside nurses) but the bottom line is that nearly every analysis predicting a shortage of doctors lacks essential context around care delivery. These analyses fail to include how the industry operated prior to the pandemic, how providers have responded to the crisis, and all the positive momentum Covid-19 has forced on providers.

Covid-19 pushed the industry to make some long overdue changes to clinical workflow that have the potential to dramatically expand clinician capacity. Providers reduced the administrative burden on doctors, deployed APPs autonomously, performed holistic care team redesign, and finally invested in technological substitutions that would improve workflow and extend panel size without adding any additional burden on doctors. These are the things that would have always prevented us from facing a physician shortage. The pandemic merely accelerated the adoption of the solutions we've been highlighting and advocating for years. 

3. Plenty of independent physician practices shut down—but those that remained are stronger than ever.

Sarah Hostetter, Director, Physician Research

The prevailing narrative early on in the pandemic was that Covid-19-related volume declines would be a final blow to independent physician practices and physicians would seek the safe harbor of employment. Contrary to these headlines, our team predicted that most independent practices would weather the storm. What's played out is that the practices that did indeed weather the storm are even stronger than they were pre-pandemic. As volumes declined in the spring of 2020, physician practices took an approach that is uniquely feasible for shareholder-led organizations: asked shareholders to make sacrifices for the long-term wellbeing of the group. And this momentum is lasting beyond the initial crisis moment.

At the same time, health systems, payers, and other partners worked even more closely with their independent physician partners in the fight against Covid-19, shining light on the indispensability of these partnerships—and on the shortcomings in existing partnerships. The strongest independent groups are noticing this shift and thinking of potential partners as tools to maintain autonomy and looking for models that allow for investment in growth without losing their independence. I expect that these groups will continue to grow and become consolidators, oftentimes competing with other legacy players.

4. Virtual care can come from anywhere. (But it turns out patients still prefer local providers.)

Yulan Egan, Managing Director, Executive Insights 

If you'd told me two years ago that when virtual care finally had its moment, traditional health systems and physician groups would be the ones to deliver most of that care, I wouldn't have believed you. But that's precisely what has happened amid the pandemic: the vast majority of virtual care patients received that care from their own physicians, not from a third-party vendor or a virtual care service provided by their health plan. The question now is whether local providers can maintain the lead they developed during the pandemic. Vendors are working hard to evolve their models to include full-blown primary care, chronic disease management, and downstream navigation to compete more effectively with traditional provider groups. 

But while telehealth may not return to the extraordinary utilization levels seen in Spring 2020, it's remained orders of magnitude higher than before the pandemic. Local providers—doctors, health systems, and ambulatory sites of care—have a once-in-a-generation opportunity to embrace the digital revolution that can drastically expand access to care while providing new options to clinical staff to practice medicine. But if they turn their backs on digital health, those technology providers with national scope will almost certainly fill the void to satisfy patient demand, with long-term steerage consequences for local incumbents.

5. Intense focus on patient safety actually made their care more convenient.

Robert Lazerow, Managing Director, Executive Insights, and Christopher Kerns, Vice President, Executive Insights

Concerted focus on patient safety surprisingly led to improvements in consumer experience. For anyone who's had to experience the masking and visitation policies imposed at most sites of care, that may sound ridiculous. But the new burdens placed on legacy care delivery led to a flowering of innovation in the ways patients can access care. The huge gains in virtual care are well-known, but we've also seen massive steps forward in the deployment of low-cost home-based care options with the potential to improve not only quality of life, but also accelerate the adoption of value-based care (which typically funds home-based care) and provide greater access to historically underserved populations. And on a more prosaic level, millions of consumers can now receive immunizations, pick up prescriptions, and receive care management services from the convenience and comfort of their cars via drive-through options. What an irony that a pandemic that placed innumerable burdens and barriers on daily life could lead to a revolution in consumer convenience.

6. Clinical trials will never be the same again.

Christopher Kerns, Vice President, Executive Insights

In the Before Times, clinical trials could accurately be described as slow, expensive, and, shall we say, unrepresentative of the populations being served. The combination of a pandemic spurring the need for rapid vaccine deployment, a massive injection of public funds, and a potentially global market, drug makers began embracing technology and artificial intelligence to source clinical trial participants more effectively, cheaply, and equitably. It's not just the mRNA-based vaccines that made a giant leap forward, it's the entire clinical trial process for nearly every drug imaginable. The ability to bring pharmaceutical innovations to market faster and more cheaply will likely have long-term consequence both good and bad for society writ large.

On the one hand, the ability to treat disease will likely accelerate, leading to significant improvements in quality and length of life. On the other, these innovations raise a troubling question: who will pay for this massive innovation? The answer to that question remains unclear, and in the meantime, we could see drug costs skyrocket—which could in turn lead to draconian policy responses. The clinical trial revolution is here, but its impact is as uncertain as ever.

7. The expanded safety net actually worked.

Amanda Berra, Expert Partner

In the winter of 2020, we pulled together a list of major industry impacts of the pandemic, and for a second I thought—wait, we missed uninsurance. I thought that had to be on the list—after all, unemployment was rampant, so clearly providers had to have been hit with a massive wave of uninsurance and bad debt. But when I tried to put together the support for that assertion, I realized I couldn't. We hadn't heard any evidence of this in conversations with hospitals or health systems; no health care leaders spontaneously cited it as an issue.

I did not at that time understand why uninsurance didn't seem to be up. In fact it only became clear once I read analyses—especially this one from the NY Times Upshot team, Margot Sanger-Katz, Sarah Kliff and Quoctrung Bui—that what's happening is that we are living in a post-ACA world. Between Medicaid expansion and increased availability of (more affordable) individual insurance products, it seems that under-65 coverage is now substantially decoupled from employment. It's probably a telling symbol of the age in which we live that "working as intended" qualifies as unexpected, but here we are.

8. Providers emerged in stronger, not weaker, financial positions.

Yulan Egan, Managing Director, Executive Insights 

At the outset of the health crisis, we, like many others, assumed that the major purchasers of health care–Medicare, Medicaid, and employers–would see a strain on their budgets. Many looked to the global financial crisis of 2008-2009 as a potential proxy. In the wake of that crisis, we saw nearly every state slash Medicaid rates, employers dialed up their focus on high-deductible health plans, and Medicare incorporated significant cost-cutting measures into the Affordable Care Act. But the Covid-19 pandemic actually provided short-term financial relief for purchasers, particularly states and employers. Health care spending decreased due to deferred care, tax revenues performed better than expected, and financial relief from the federal government provided an additional boost

To date, all major purchasers have held off from drastic cost-cutting measures and instead focused on longer-term priorities, such as investments in health equity, virtual care, behavioral health, and primary care. These new budgets reflect significant changes to spending priorities that will reverberate for years to come.

9. Health plans, freed from paying for elective procedures, gained breathing room to make long-term bets.

Natalie Trebes, Director, Health Plan Research

At the pandemic's outset, health plans had no idea what the total net services use (and thus total cost of care for their memberships) would be, so they were forced to hedge and prepare for the worst. But generally, the pandemic caused more delays and avoidance of normal services than increases in additional Covid-19 care services (and far too often, providers have zero capacity for normal services). So plans—and their employer purchasers—generally have seen lower medical spending overall.

While much of the excess savings must be allocated to MLR-regulated care activities, even those services can include strategic deployments of new care models, value-based payments, and care management member engagement services. The remaining budgets—and human capital bandwidth—therefore had excess capacity to focus on strategic investments and initiatives for the next decade of health plan positioning in the ecosystem. These range from the partnerships and investments we see plans making with physician practices to new ventures and acquisitions that expand beyond their traditional health insurance business. Health plans—especially the largest ones—used the financial reprieve provided by the Covid-19 pandemic—to advance strategic priorities. And as a result, they are far better positioned to lead on digital health, home-based care, and provider partnerships than most other players in the industry.

10. It turns out it took a pandemic to force a real reckoning with outcomes disparities.

Amanda Berra, Expert Partner

It's been well-reported that the pandemic spotlighted long-standing disparities (racial, socioeconomic, geographical) that exist at the point of carefully enough to kickstart practical efforts needed to address them. CMS quality reporting and incentives are so consequential, they end up practically defining what quality is. But currently, survey data suggests that a minority of providers have adequate reporting and analysis on disparities at the point of care. Many if not most hospitals simply do not know, because they have never systematically measured the degree of such disparities (by race, ethnicity, sex, age, or language) in performance on commonly reported safety and quality metrics. But If CMS continues down its stated path, there will be a whole new dimension of quality—health equity—that hospitals and systems will start prioritizing in a real way. It's often stated that one cannot inflect what one cannot (or will not) measure. But now we have a real opportunity to measure which outcomes have the greatest disparities—and a real chance to finally improve on those numbers.

11. Behavioral health access actually got better. (Unfortunately, fragmentation just got worse.)

Clare Wirth, Research Consultant 

Getting access to behavioral health care is easier than ever before in the United States. Tele-behavioral health utilization has held at peak Covid-19 levels, unlike other specialties. And there has been a proliferation of digital tools from which to get that care following a boom in investment. Beyond that, Covid-19 forced the conversation. Americans are acknowledging their behavioral health needs, indicating some stigma has finally dissipated. 

But we didn't solve one of our greatest problems—fragmentation. In fact, we made it worse. Behavioral health care is still walled off from the rest of the care continuum because of both incidental and intentional design choices. Continued separation leads to inferior patient care. Yet new entrants have, so far, little incentive to integrate their services into the broader care continuum. 

Behavioral health is health. True integration will require a cross-industry effort to design care pathways for patients that seamlessly weave together new and traditional care models, taking advantage of the benefits and adapting to the constraints of both.