The COVID-19 pandemic is causing a sea change in how countries are managed internally, as well as changes in relations between countries. It is also causing significant changes in health-care systems everywhere
It has become clear over the course of the crisis that countries must invest more funds to ensure that all aspects of their health-care systems are operating properly on a daily basis, as well as in periods of stress, as evident at this time. Most government-dominated health-care systems did not perform well under stress, with the notable exception of Israel.
Another lesson to emerge from the past few months is that countries with deep scientific expertise will disproportionately benefit from the pandemic because of the massive investment that the public and private sectors are making to develop new diagnostic tests, new therapeutics, new vaccines, as well as ancillary masks and other personal protective equipment. These investments will lead to the development of new companies that will race to succeed against their larger competitors, thereby stimulating high-end job growth.
The new companies will stimulate the growth of venture-capital investment and new venture-capital funds, and will keep investment bankers and lawyers busy facilitating the process.
Meanwhile, America’s prominent diagnostic testing companies stand out for their response. Recall that it was only in January that they first heard of COVID-19. By February, they were developing diagnostic tests in small quantities. By March, the FDA had approved these products, and by April, U.S. testing reached more than 100,000 per day. By May, tests rolled out to detect those persons who had already been infected and whose immune systems developed antibodies. By June, more than 1 million people per day will be tested.
Health insurers rose to the challenge by offering flexibility unknown in this industry. For COVID-19 patients, the industry dropped copayments and deductibles so as to eliminate barriers to care. The industry facilitated mail-order pharmacy prescriptions. Most unusually, the industry accelerated more than $5 billion of future payments to hospitals to help them cover their short-term cash-flow problems.
Senior citizens will also likely increasingly choose to join private managed-care insurance companies, which currently attract only about 35 percent of this population. To compete with traditional government-run Medicare, the private companies generally offer reduced copayments and deductibles that help seniors better cope with rising health-care costs.
There are also likely to be long-term changes to the medical field as a whole as a result of the pandemic. Prolonged social distancing has already stimulated and will hasten the growth of telemedicine, as well as home delivery of pharmaceuticals and medical supplies. Non-COVID-19 patients are likely to increasingly seek outpatient services to avoid the inpatient hospital environment.
There are also numerous silver linings that we should watch for. As the country reopens and we move back to “normal” or the “new normal” in the second half of 2020, we will be comforted by the army of companies and organizations already working feverishly to anticipate our new needs. We will be personally grateful and collectively proud as they and we succeed in overcoming this enormous pandemic challenge.
Ken Abramowitz is the president and founder of SaveTheWest.