How easily can health care stretch?
Pandemic Minute: What hospitalizations in 2021 vs. 2019 teach us about expanding care.
I’d like to share a sigh-of-relief picture today, of trends in covid-19 related hospitalizations. The best part of this picture is March 31, 2023, where ICU-filled beds are scraping away towards zero. However, the national healthcare spending numbers for the boxed, less pleasant 2021 have recently been released- let’s have a closer look.
The figure below shows how we spent our health care dollars in 2021. Hospital care was the largest category, at 31.1%. This reflects the bookend covid-19 winter surges, as well as all the other things people need hospitals for, such as heart attacks, strokes, surgeries, etc.
So hospitals were really taking on a lot in 2021, right? Let’s compare 2021 to 2019’s spending percentages in the chart just below. Did you have to squint? Wait, is the before-the-craziness 2019 number (31.4%) basically the same as 2021??
Don’t hurt yourself, but yes, the percentages here are nearly the same. Despite a huge increase in demand for hospital services from covid-19, the percentage of spending from hospitals didn’t look very different from pre-pandemic percentages. What this illustrates is the difficulty in rapidly stretching health care services- they are very hard to ramp up quickly. Hospital providers are highly trained over many years to provide services and hospital equipment is large, complex, and expensive. Neither of these can be quickly increased, even if desperately needed. This inability of the supply of hospital services to stretch quickly is called inelastic, like a tough rubber band.
A few ways hospitals tried to address this was allowing other professionals, such as medical residents, to take on new roles. However, as my research on visit disruptions suggests, sometimes creating new supply meant destroying it elsewhere, by switching other specialists, such as cardiologists, to act as ICU physicians.
I will leave you with an illustration of a more responsive health sector. If you had good eyes above, you noted that Public Health expenditures jumped from 2.6% to 4.4% of U.S. healthcare spending. The supply of health information is easier to expand quickly and, lucky for us, an excellent preventive treatment.