HealthJanuary 26, 2023

How can hospitals brace for the financial hit of long COVID?

As the COVID-19 pandemic enters its fourth year, hospitals and health systems caring for patients with long COVID are assessing financial strategies and tools for sustainable, ongoing care.

As SARS-CoV-2 infections and reinfections continue, many patients are comparing the first waves of infections in 2020 with the comparative mildness of Omicron-associated variants in 2022 and 2023. As a result, many have already declared that the pandemic is over — or at least that the end is in sight — as an endemic assumes its place and long-term mitigation strategies are discussed.

However, millions of people are still struggling with the aftermath known as long COVID. Affecting nearly one in five people who have had COVID-19, long COVID involves symptoms that persist for at least two months that can’t be attributed to another diagnosis.

From heart palpitations to recurring headaches, depression and poor concentration, long COVID symptoms impact quality of life and potentially even functional abilities. They also impose an economic burden, potentially for years to come. One Harvard economist estimates a $528 billion increase in medical spending for long COVID and Kaufman Hall reported hospitals ended 2022 with negative margins due to labor costs and higher emergency department volumes - exacerbated by the pandemic.

With some experts eyeing a future besieged by these long-haul effects and their associated costs, should hospitals brace for a financial hit?

Impacts and implications of long COVID

In a detailed UpToDate article about the evaluation and management of long COVID, the physician authors explore some of the most common prolonged symptoms, including fatigue, chest pain, cough and difficulty breathing. Those four symptoms have accounted for a large proportion of physical manifestations of long COVID, although others such as dizziness, insomnia and joint pain have also been identified. Psychological and cognitive symptoms, including challenges with memory and concentration, have also been reported.

Some patients have experienced serious concerns, such as post-acute intensive care syndrome (PICS) and cardiac complications. Roughly 10 to 20% of hospitalized patients are readmitted for these reasons or others.

Researchers have still been limited in their study of long COVID owing to a dearth of data. For the most part, anecdotal stories among “long-haulers” have informed much of what clinicians know about the phenomenon. As more funding and efforts go toward monitoring the prevalence and understanding the implications of long COVID, it could change how hospitals prepare for any future waves.

Challenges with mounting healthcare costs

The financial impact of the COVID-19 pandemic goes beyond just patients with recurring infections or lingering health challenges. It also effects hospitals in caring for patients with chronic conditions who delayed care out of concern for contracting the virus in health settings.

Caring for long COVID patients

Predicting the financial impacts of long COVID will be central to hospitals’ preparation for potential long COVID waves. COVID-19 already requires expensive care: In a study assessing the cost burden of COVID-19, researchers found that people who were infected drove higher total costs within the five months after their diagnosis.

An increasing number of high-acuity patients also drives length of stay. And as an American Hospital Association report put it in 2021, a changing inpatient population requiring more intensive care will offset any revenue increases those additional volumes bring in.

Considering the roughly 16.3 million Americans with long COVID — likely to be joined by more in the future — the bottom-line impacts absorbed by hospitals could become more palpable. But long COVID is just one costly and lingering effect of the pandemic. Many indirect impacts of COVID-19 could also jeopardize future hospital profitability.

Patients with chronic conditions delayed care

Additionally, many hospitals are still grappling with the wave of patients resulting from delayed care during the pandemic, including people whose cancers were detected in later stages or whose undiagnosed heart conditions progressed to an advanced state. Cardiologists point to a potential wave of heart disease and heart failure patients in the next five years. As COVID-19 took priority in 2020 onward, the continuum dropped its preventive focus. Like long-haulers, these populations could all require more costly inpatient and outpatient care as their symptoms continue.

As these new patient populations emerge, the financial implications of caring for them join other stressors. Changing reimbursement models, increased costs, supply constraints and staff shortages weigh on providers, while lackluster margins are still 37% lower than pre-pandemic.

Suffice it to say, it’s tough out there. Hospitals and clinicians will have to adapt to meet these continuing challenges.

What hospitals and health systems can do to respond

Organizations such as the American Hospital Association have exposed many of the financial burdens that hospitals face today, calling on federal leaders to provide more support. But in the absence of immediate help, many health systems have pushed austerity efforts to bolster the books.

Among their strategies: Squeezing out savings from the supply chain, consolidating contracts, consolidating themselves, and staking their spending on a demonstrable return on investment. In addition to reigning in expenses, they are also driving revenue by enabling more expansive care delivery models, such as telemedicine.

Opportunities to improve the quality of care can also improve cost management, particularly as reimbursement models move toward value-based care. Increasingly, healthcare executives are turning to technology and tools to standardize clinical surveillance, support patient education, and better understand health data analytics. With these tools powering everyday workflows, organizations can better support patient outcomes, population health management and productivity while averting costly effects like readmissions, nonadherence and adverse health events.

Controlling health costs in an unknown future

The COVID-19 pandemic has been barely predictable weeks ahead of time, much less months or years out. But the financial impact of a changing population of long COVID patients is setting back an already hurting hospital industry. With long COVID’s direct and indirect clinical effects exacerbating other challenges like supply and staff shortages, leaders will need to double down on efforts to optimize and standardize care delivery, despite the unknowns.

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