The prognosis on elective surgeries

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Written by Todd Bellemare

At the recent HFMA Annual Conference, I had the honor to present a session that took a deep dive into the future of elective surgeries.

If you couldn’t make it to the conference, I’ve put together a short summary of how you can leverage the latest healthcare commercial intelligence to predict when elective surgery volume will rebound.

COVID-19 forced hospitals to postpone elective surgeries resulting in lost revenue

On March 18, 2020, CMS recommended that hospitals across the nation postpone elective procedures in order to maximize available bed space to treat COVID-19 patients.

With the pause in elective surgeries, healthcare organizations of all sizes have been dealing with massive financial losses. One research study found that the cancellation of elective procedures could result in estimated losses of $16.3 to $17.7 billion per month in revenue for US hospitals.

Because these types of high-margin procedures are a major source of revenue, many hospitals found themselves in a seemingly counter-intuitive position of furloughing physicians at the same time as they saw a massive influx of COVID-19 patients.

However, as parts of the country started to see declines in COVID-19 cases many hospitals restarted surgical services.

How long will it take to catch up on missed elective surgeries?

Medical claims data can provide us with valuable intelligence to predict how long it might take to clear out the pent-up demand for these surgeries that were postponed in 2020.

By taking the total number of surgeries lost and dividing that by the number of excess surgeries that can be performed each month, we can get a rough estimate of how many months it will take to clear the backlog.

The timeline for working through the backlog varies for each elective surgery type. For example, it would take us roughly 29 months to catch up on hernia repairs. Meanwhile, we caught up on the backlog of knee replacement surgeries in mid-July 2021.

A few other elective surgical categories fared a bit better than hernia repairs in the last few months:

  • A massive number of colonoscopies can be performed per month as 1.7M was the maximum capacity in 2019. While it’s expected to take until next summer to clear the procedure backlog, we are already caught up on more than 500K procedures as of August 2021.
  • Cataract surgery is another high-volume procedure, with a max capacity of about 245K per month performed in 2019. While these have not bounced back as quickly as knee replacements or even colonoscopies, we are firmly in the black and have claimed back 24K of the 240K lost surgeries.

How to leverage claims data to calculate the timeframe to work through the backlog of elective surgeries

Let’s use hernia repair surgeries as our example to walk through how we leveraged claims data to calculate that it will take 29 months to catch up on pent-up patient demand.

Three primary metrics determine how long it will take to make up the missed surgeries:

1. Maximum number of surgical procedures that can be performed in one month

To predict how long it will take to catch up on missed surgeries, we first need to understand the maximum number of surgeries that can be performed in one month. To do that, we need to look at medical claims data from the pre-COVID-19 times of 2019.

As you can see in the graph below for hernia repairs, January 2019 was the month with the highest volume of procedures, coming in around 72K. We’ll use that as our baseline as the maximum number of surgeries that can be performed in any future month.

2. Average number of surgical procedures that can be performed per month

In addition to knowing the maximum number of surgeries performed in one month, we also need to know the average number of surgeries per month. By comparing the average to the maximum number of procedures, we gain an understanding of how many excess surgeries can, in theory, be done each month.

For hernia repairs, the average number of procedures per month is around 65.5K. Therefore, we know providers can perform an extra 6.5K surgeries in future months to reach the maximum possible procedure volume.

 

Graph 1: Data from Definitive Healthcare's ClaimsMx for patient visits for hernia repair surgeries in the calendar year 2019.

3. Number of lost surgeries due to the elective surgery pause

With the elective surgery pause, volumes for procedures dropped drastically in 2020. The patients who need those surgeries didn’t just disappear; rather, they delayed care that they’ll need to make up at some point.

To figure out how many surgeries were lost due to the COVID-19 pandemic, we need to look at year-over-year changes in procedure volume in comparison to 2019. We’ll want to compare both 2020 and 2021 volume to 2019 since COVID-19 is not in the rearview mirror yet.

In the chart below, we can see the difference in patient volume for hernia repairs compared to 2019. We saw the biggest drops in procedures as the elective surgery pause went into effect in 2020, but we continue to see declines well into 2021. Overall, we lost a total of 193K surgeries since COVID-19 hit through the end of August 2021.

 

Graph 2: Data from Definitive Healthcare's ClaimsMx evaluating the difference in patient surgeries in 2020 and 2021 compared to 2019.

What comes next for elective surgeries

No one can tell for certain what will happen with the elective surgery market. All we can do is estimate how long it will take to catch up on elective procedures and recoup the lost revenue.

Not every patient who needed an elective procedure will return to get one. We could see future spikes in COVID-19 that necessitate pausing elective surgeries again. Providers, facing record levels of burnout, cannot perform the maximum number of procedures every month. Some elective surgeries might rebound faster than expected.

As we look to 2022, we expect more ambulatory surgery centers to come back online and hospitals to start scheduling procedures as COVID-19 cases hopefully begin to decline as vaccinations continue and new COVID-19 treatments come to market.

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