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May 04

Projected COVID-19 Financial Impact is Shocking

Posted by Scott  filed under economic impact  

The scope and size of the projected COVID-19 financial impact is shocking. 

According to the National Association of ACOs (NAACOS), factoring of variances in disease severity, hospitalization rates, etc., the epidemic could cost Medicare more than $115 billion over the next year.  They assess this will hit clinics that participate in ACOs since providers are held accountable for their patients’ associated healthcare costs.  Likewise, Medicare Advantage plans face similar challenges.  NAACOS anticipates ACOs will experience a 6 – 18% spending increase due to COVID-19. 

NAACOS and other organizations with a substantial stake in the transition to alternative payment methods and value-based models continue to seek CMS and the federal government to provide some protection against the anticipated penalties that could result. 

Healthcare is historically recession-proof; illness occurs in bad times like in good times and insurance covers most associated costs.  However, the recession looming from COVID-19 may prove significantly different.  Unemployment is increasing nationwide and money is getting tighter in the face of uncertainty.  On top of that, in many cases insurance coverage is tied to employer-sponsored plans.  For those still employed and covered, more people have historically high deductibles and cost-shares making them less likely to seek care and fill prescriptions. 

Clinics are feeling the pinch, too, as people opt to stay at home rather than seek care – and clinics strive to minimize the risk of disease spread by limiting which patients come in and for what.  Some primary care clinics report up to 70% reductions in use of health care services, which means in about 45 days, a 70% reduction in revenue.  Granted, some of those services are merely deferred and will likely occur later, maybe in the summer.  Still, clinics need solutions now to generate revenue, so they can remain open for later.  Also, without the routine face to face with their patients, providers need the tools to keep in touch and to manage their patients, especially those at the greatest risk.

This is where clinics should consider services like Chronic Care Management (CCM) and Remote Physiologic Monitoring (RPM, aka Remote Patient Monitoring).  These are two strategies that are very straight forward and can be applied to 100% of clinics that see Medicare patients.  Additionally, if the practice can support it, reduced restrictions for telehealth services and other non-face-to-face services enable providers and staff to remain engaged with patients and generate revenue otherwise lost if unable to see patients in office. 

Since the beginning of the PHE, more and more primary care clinics are experiencing lower patient volume, reduced revenue, PPE shortages, etc. and many are unsure how long they can sustain operations; the financial strain is impacting their ability to keep the doors open, lights on, and staff employed.  Introducing CCM and RPM now can help your clinic and your patients not only in the short term, but sustainably into the future.



Cutler, David. (2020) How Will COVID-19 Affect the Health Care Economy? Retrieved from

Leventhal, R. (2020). Projected Financial Impact of COVID-19 Leaves Healthcare Leaders Searching for Help. Retrieved from

Primary Care Collaborative (PCC). (2020). Multiple reports and survey results retrieved from