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How Primary Care Practices Have Survived the Coronavirus Pandemic

Analysis  |  By Christopher Cheney  
   February 12, 2021

Transitioning services to telemedicine and federal assistance through the Paycheck Protection Program were pivotal for primary care practices in 2020.

Primary care physicians (PCPs) have endured daunting challenges during the coronavirus pandemic, but a combination of business savvy and external support has helped many of them to keep serving patients, a new report says.

Particularly in the early phase of the pandemic last spring, primary care practices experienced dramatic reductions in patient volume as patients avoided medical offices due to fear of coronavirus infection. Two Florida-based practices interviewed for the new report experienced deep reductions in patient volume during the early weeks of the pandemic, with one practice reporting a 60% decrease and the other practice reporting a 75% decrease.

The new report, which was published by the Urban Institute with funding from the Robert Wood Johnson Foundation, is based on a review of published data that documents PCP pandemic experiences and interviews with 16 PCPs. The size of the physician practices that were interviewed ranged from a solo practitioner to a practice that employs 370 physicians. The practices operated in 10 states: California, Florida, Georgia, Massachusetts, Michigan, Missouri, New Jersey, North Carolina, Texas, and Virginia.

PCPs have faced major challenges during the pandemic, the report says. "The PCPs we interviewed provide a window on how the COVID-19 pandemic has challenged our already-fragile system of primary care. These have included threats to their financial viability, particularly for smaller, independent PCP practices, and difficulties delivering quality care while ensuring safety for their patients, clinicians, and staff."

However, the PCPs interviewed for the report found ways to overcome their difficulties. "These PCPs have proven to be capable and nimble business owners, quickly shifting to new modes of care delivery. They have also taken advantage of government and community support to sustain their ability to serve their patients," the report says.

But perseverance has come with a considerable negative consequence. "These efforts have taken their toll, and many report a significant level of burnout that could have long-term implications for our nation's system of primary care," the report says.

Struggle for survival

Most PCPs reported severe financial pressure in the early phase of the pandemic.

In addition to the financial hit from reductions in patient volume, several PCPs discontinued offering "non-essential" services such as physicals to reduce potential coronavirus exposure for patients and staff. Discontinuation of these services was a drain on revenue. "Most PCP respondents reported dramatically reduced revenue in the early phases of the pandemic. For example, a Massachusetts doctor reported that his practice experienced a 40% decline in revenue," the report says.

PCPs also reported significant difficulty in securing adequate personal protective equipment (PPE) during the pandemic. "Most reported that acquiring necessary PPE has been difficult, if not impossible, at multiple points during the pandemic. This was particularly true for the smaller practices, which must compete with large health systems and hospitals for supplies," the report says.

Acquiring PPE contributed to higher costs during the pandemic, PCPs reported.

The financial woes required many PCPs to cut costs, the report says. "Several PCPs reported that they reduced their own salaries, imposed staff furloughs, pay cuts, or implemented a combination of these tactics."

Transition to telemedicine

Nearly every PCP interviewed for the report had shifted a significant level of services to telehealth, which not only increased safety during the pandemic but also boosted revenue. "A Missouri doctor told us that, without telehealth, they would be under 50% capacity. The practices also reported that purchasing the necessary technology and engaging with telehealth vendors was relatively affordable," the report says.

Reimbursement rules have been favorable for telehealth during the pandemic. During the public health emergency, Medicare is reimbursing telehealth visits at the same level as in-person visits. "Several PCPs practiced in states that require private insurers to do the same," the report says.

External support

Federal assistance and community support has helped PCPs stay in business, the report says.

The most consequential external support reported was the Paycheck Protection Program (PPP) established through the Coronavirus Aid, Relief, and Economic Security (CARES) Act. PPP funding was more helpful to primary care practices than the Provider Relief Fund (PRF), which allocated $175 billion to compensate providers for decreased revenue or treatment costs associated with the pandemic, the report says.

"Recipients of PPP loans who used the funds for payroll, business mortgage interest payments, rent, or utilities can request loan forgiveness, relieving them of any obligation to pay back the funds. Of the PRF funds, the federal government distributed a large portion automatically to providers who participate in Medicare, based on their total net patient revenue. This resulted in large hospitals and health systems receiving the bulk of the money; small PCP practices have received a relatively small proportion of these funds."

While not as significant as the PPP funding, communities also helped primary care practices, the report says. "Many practices reported that they had received donations from local residents, foundations, and non-profits. Some donated PPE and provided financial assistance. One doctor reported that patients were making them masks."

Primary care practice forecast

Reimbursement looms large for primary care practices in the second year of the pandemic, the lead author of the study told HealthLeaders.

"Many practices continue to rely on telemedicine for a significant portion of services, so continued adequate reimbursement will be important. Over the longer term, some practices may be more willing to enter into capitated arrangements with payers, in which they agree to treat patients for a pre-set amount each month, regardless of the number of services delivered," said Sabrina Corlette, JD, research professor, founder, and co-director of the Center on Health Insurance Reforms at Georgetown University's McCourt School of Public Policy.

After the coronavirus crisis has passed, Corlette predicted there will be three dominant trends at primary care practices. "I suspect the trend toward consolidation and acquisition will continue, more practices will be open to taking on capitated forms of payments, and the delivery of services via telemedicine will be here to stay."

Related: Coronavirus Survey: Primary Care Practices Face Ongoing Strain During Pandemic

Christopher Cheney is the senior clinical care​ editor at HealthLeaders.


KEY TAKEAWAYS

The coronavirus pandemic has posed several difficulties for primary care practices, including reduced patient volume, decreased revenue, and infection control challenges.

Nearly every primary care physician interviewed for a new report said their practice had transitioned a significant portion of services to telemedicine.

To remain financially viable, several of the primary care physicians said they had reduced their own salaries, furloughed employs, or made staff pay cuts.


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