Bill Mather, a pharmacist in the small Iowa city of Greenfield, wanted to make sure his neighbors could fill their prescriptions without driving long distances or enduring long wait times.
So when pharmacy chains and big-box stores began expanding into rural markets, he sold his drugstore in 2007 to Pamida, a grocery chain owned by the Shopko department store company, hoping that would keep his practice alive. Then, in 2019, when Shopko declared bankruptcy, shuttering more than 360 stores, he and another Shopko pharmacist helped open a new drugstore for the city of about 2,000 people.
Across the country, pharmacists like Mather are filling the voids left when large drugstore chains and big-box stores with pharmacies pull out of small communities. In some areas, pharmacists who were let go when big chains closed are now opening new drugstores, often in the same locations. In other areas, pharmacy owners from neighboring towns are opening new branches. Without them, numerous communities would have been left with no pharmacy.
It didn’t used to be this way. Big-box stores like Shopko started to move aggressively into the pharmacy market 30 years ago, hoping customers would fill their carts while the store filled their prescriptions. Large chains established beachheads in small towns by acquiring independent pharmacies or driving them out of business.
According to the Bureau of Labor Statistics, the number of pharmacists employed at big-box stores peaked at more than 31,800 in 2012. But as online sales and mail delivery of consumer goods and prescription drugs grew, the big-box stores had no reason to stay. By 2019, the number of big-box pharmacists had dropped to fewer than 18,000. (The bureau no longer reports the number.)
“The big-box stores came into smaller and smaller communities, and they, in essence, outcompeted all the other pharmacies in the area,” said David Zgarrick, a pharmacy professor at Northeastern University in Boston. “Now they’re completely gone and with them the pharmacy services and everything else they provided. They left a vacuum in a lot of these places.”
With CVS Health’s recent announcement that it will close 300 stores a year over the next three years, more towns could lose another tier of pharmacies: the big drugstore chains. CVS has not yet said which stores will close.
“We’re considering a number of factors when making these decisions, including local market dynamics, population shifts, store density, and the needs of underserved communities,” said Mike DeAngelis, a CVS Health spokesperson. “In fact, reaching underserved populations has been a priority for us all through the pandemic, such as the access to testing and vaccines we’ve provided.”
Kathleen Bashur, a spokesperson for the National Association of Chain Drug Stores, said chain pharmacies of all types and sizes play a significant role in meeting the health and wellness needs of communities throughout the nation. “The decision to close a store is a difficult one,” she said.
Zgarrick attributes much of the decline in big-box pharmacies to Amazon and other online merchants that undercut the profitability of their non-pharmacy sales. In the past, big-box stores could treat pharmacies as loss leaders and make up that revenue with sales of other goods. Now, Zgarrick said, big-box stores have to ask tough questions about how to allocate their space: “‘At the end of the day, how are we going to make the most money per square foot? Is it by having a pharmacy or by selling tires?’”
Nelson Lichtenstein, a University of California-Santa Barbara history professor who has chronicled the rise of Walmart, said big-box stores are constantly reevaluating their store locations, closing less profitable stores and opening new ones in places where they think they can make money.
“They just keep a kind of slow churn,” he said.
The cost of building a big-box store is about $10 million, Lichtenstein said, and such stores can net $200 million in annual revenue. Pulling out of a location is therefore not a huge loss for a big company if revenues falter.
“So they will shut down the stores and leave a devastated town because the Walmart put the other guys out of business,” he said.
Walmart did not answer questions about its closures.
The growth in online options for all kinds of items, spurred by people shopping from home during the covid-19 pandemic, has put further pressure on big-box stores.
“Now they’re less likely to do that roaming shopping than they were five years ago,” said Adam Hartung, a business strategy consultant with Spark Partners. “They’re not going to say, ‘Oh, let’s pick up a prescription and, while we’re at it, let’s walk through the store and look at vacuum cleaners.’ That doesn’t happen anymore.”
Hartung said that the U.S. retail market has an excess of shops, by as much as 40% compared with other countries, and that more big-box stores are likely to close in the coming years.
But closures provide opportunities for regional chains or pharmacists willing to strike out on their own.
In Orofino, Idaho, the mayor, the chamber of commerce and many residents appealed to pharmacist Rod Arnzen after Shopko pulled out. So Arnzen began delivering to Orofino from his store 23 miles away in Kamiah. He then opened a branch in Orofino in the building left behind by the pharmacy that had previously sold its business to Shopko.
Andy Pottenger, who owns a pharmacy 45 miles away in Lewiston, Idaho, added a second pharmacy in Orofino, population about 3,000, after receiving hundreds of responses to an ad he had placed in the local paper to gauge interest.
“It was overwhelming,” he said. “That kind of cemented the idea that we should do it.”
In Montana, Mike Matovich, a third-generation pharmacist, opened stores in Roundup and Hardin after Shopko closures there.
“It’s a pretty good-sized community and has a hospital and clinic in town,” Matovich said of Roundup, “and all of a sudden people are driving 50 miles one way to fill an antibiotic for a sick child.”
Matovich has seen what can happen when a rural community loses its only pharmacy.
“If there’s a hospital clinic and a pharmacy there, they’re going to do fairly well,” Matovich said. “Once you lose one or the other, the communities start to struggle because people start leaving to be closer to health care.”
For the residents of Greenfield, Iowa, Shopko’s decision meant they had to scramble. Shopko had sold the pharmacy records to a Walgreens 50 miles away. Some people turned to the Hy-Vee grocery stores in the nearby Iowa cities of Atlantic or Winterset, or to the Walmart in Creston — each at least a half-hour drive away. Others switched to mail order.
“It was sheer chaos,” former Shopko pharmacist Rachel Hall said. “People were trying to figure out what to do, where they should send their prescriptions.”
Mather, Hall and the rest of the Greenfield staff were given just one week’s notice after being told they had nothing to worry about. Their pharmacy had been among the chain’s fastest-growing locations.
“We literally had trophies from Shopko that we threw away when we left,” Hall said.
Former Shopko executives contacted by KHN declined interview requests. Shopko Optical, which operates in 11 states, said it is no longer affiliated in any way with Shopko Stores and declined to comment.
Mather and Hall didn’t want to give up on Greenfield. They reached out to NuCara, a chain with 30 retail pharmacies across five states, and it agreed to help them open a drugstore in their city.
NuCara opened pharmacies in two other communities that Shopko vacated. In the Minnesota cities of Cokato and North Branch, NuCara partnered with pharmacists who had previously sold their pharmacies to Shopko, said Brett Barker, vice president of pharmacies for NuCara.
In Greenfield, Hall and Mather were forbidden from telling customers about the new NuCara drugstore until Shopko officially closed its doors. Hall said Shopko management wanted to maintain the value of the customer files it was selling to Walgreens. So Hall and Mather asked the local chamber of commerce to get the word out.
They found temporary space at the local hospital, which relocated its billing office to accommodate them. A year later, they moved back into their former location in the old Shopko building, leasing the space from new owners, who were running a household goods store there.
After serving three generations of Greenfield customers, Mather was relieved the town still had a pharmacy. But he couldn’t get past how Shopko had ended things.
“The way they slammed the door, I was really unhappy about that,” Mather said. “It wasn’t fair to all the people at the Greenfield pharmacy and the people of Greenfield. Shopko couldn’t have cared less.”
Yet the move brought Mather full circle. Greenfield still has a pharmacy, just as when he started at Murdy Drug in 1968. It’s just a different storefront, with a new name on the sign.
In recent years, interfacility transports or transfers, also known as IFTs, have become increasingly common for GVH Paramedics, forcing the team to drive far outside its already vast zone.
GUNNISON, Colo. — The night after Thanksgiving, a small ambulance service that covers a huge swath of southwestern Colorado got a call that a patient needed an emergency transfer from the hospital in Gunnison to a larger one with an intensive care unit 65 miles away in Montrose.
The patient — a 78-year-old man — was experiencing atrial fibrillation, an irregular heartbeat that usually isn’t life-threatening. But for patients like this one with chronic health conditions, a history of cardiac issues and high blood pressure, the condition can cause a stroke or heart failure.
Workers from Gunnison Valley Health Paramedics rolled the patient, who was on a gurney, out of the hospital and into the frigid night air. AnnieGrace Haddorff, the emergency medical technician on call, helped load the patient into the ambulance and jumped into the driver’s seat. Paramedic Alec Newby got into the back and hooked the patient up to a blood pressure cuff; a pulse oximeter, which measures heart rate and blood oxygen saturation; and an electrocardiogram, which records the heart’s electrical activity.
“Your heart is obviously pissed off,” Newby told the man as the ECG confirmed the atrial fibrillation.
The ambulance pulled onto U.S. Highway 50 for the one-hour-and-15-minute drive past clusters of homes among rolling hills of sagebrush, the expansive Blue Mesa Reservoir and the gaping Black Canyon of the Gunnison, with its craggy spires.
The patient was stable enough for the long drive, which covered only a sliver of GVH Paramedics’ 4,400-square-mile service area. It is more than twice the size of Delaware and is the largest response zone for an ambulance service in all of Colorado. A typical fire or emergency medical service response area ranges from 100 to 400 square miles.
In recent years, interfacility transports or transfers, also known as IFTs, like this one have become increasingly common for GVH Paramedics, forcing the team to drive far outside its already vast zone. Before the pandemic, the number of transfers rose because the population of Gunnison County was steadily increasing, more tourists were being drawn to places like the popular Crested Butte ski resort, and GVH Paramedics had expanded its services to larger metropolitan hospitals outside Gunnison County.
But now the team is being called to move patients more frequently, and greater distances, because the hospital beds in the relatively close cities of Montrose and Grand Junction are filled with covid-19 patients. The team is regularly required to drive patients to Denver, which is around three hours and 40 minutes from Gunnison.
Officials from the ambulance service worry that they might find themselves unable to respond to an emergency because their resources, which include six ambulances but only enough staff to operate three of those vehicles, are tied up on a long-haul transfer.
What were once 2½- or three-hour trips to Montrose are now far longer excursions, “and that takes resources from this community,” said CJ Malcolm, chief of emergency services. “We were doing that pre-covid, but now the state is so impacted, it’s like a daily part of our lives.”
Before the pandemic, all the ambulances would be simultaneously out on 911 calls or IFTs less than 10 times a year. Now, Malcolm said, it is happening with greater frequency. In those cases, GVH Paramedics leans on the emergency response team in Crested Butte, about 28 miles from Gunnison, or the response to the patient is delayed.
In 2018, GVH Paramedics made 166 IFTs, requiring nearly 40,000 miles of travel and a total of 987 hours of ambulance operation, according to data collected by the team. Last year concluded with 260 IFTs, over 70,000 miles of travel and a total of 1,486 hours of ambulance operation. That’s a 50% increase in time on the road.
“Anytime we have one or two ambulances out on an IFT, this leaves a massive tract of land with only one ambulance to respond,” Malcolm said. “This is a moderately terrifying position to be put into when we can easily have two or three 911 calls in a row.”
In August, for example, Gunnison Valley Health hospital transferred more than 60 patients, 37 of whom were transported by GVH Paramedics. That means that at least once a day that month, a GVH Paramedics crew was taking a patient out of town, Malcolm said. And if crew members aren’t scheduled to be back in Gunnison by 1 a.m., they must spend the night in a hotel to avoid driving along treacherous mountain roads while overly tired.
GVH Paramedics’ service area covers almost all of Gunnison County, a large portion of Saguache County and sections of Montrose and Hinsdale counties. It contains mountain ranges, canyons and wide expanses of high desert. With around 6,600 full-time residents and a university, Gunnison is the largest town the team serves. The surrounding towns — including Tin Cup, Pitkin and Ohio City — are villages with a couple of hundred people or former mining towns where the artifacts from the boom times outnumber the residents.
GVH Paramedics’ 21 full-time staff members and 10 to 20 individuals who work as needed have certifications in wildland firefighting and backcountry medicine skills, including swift-water, ice and avalanche rescue. To deal with the increased demands from IFTs, they have added an extra staff member to each shift, and off-duty staffers are being called in to assist.
As the pandemic drags on, the number of IFTs will probably continue to increase. By mid-November, the number of people in the hospital with covid-19 in Colorado was staggeringly high, approaching the December 2020 peak of 1,847. Hospitalizations remained above 1,500 through the end of the month. As a result, 93% of the state’s acute care hospital beds and 94% of ICU beds were being used as of Nov. 30, according to data from the Colorado Department of Public Health and Environment.
“I don’t think we see the capacity concerns easing anytime soon,” said Cara Welch, senior director of communications at the Colorado Hospital Association.
Adding to the strain are people seeking care they delayed because of the pandemic and other respiratory viruses, such as respiratory syncytial virus, circulating in the state, Welch said.
Kelly Thompson, chief of operations of CareFlight of the Rockies, an air ambulance service that operates in Colorado and other parts of the West, agreed with this assessment. “We’ve already been transporting large numbers of kids with RSV that are sick, and you have covid on top of all of this,” Thompson said. “It’s a big concern. This is the time when we have a lot of sick people.”
In early November, to manage escalating concerns about hospital capacity, Colorado hospitals and health systems activated tier 3 of the state's patient transfer system — the highest level. That means covid and non-covid patients can be moved without their consent from a hospital that doesn’t have enough capacity to one with more space. Hospitals can also send sicker patients to medical centers with more specialized care.
As the GVH Paramedics crew members approached Montrose with their patient over the recent holiday weekend, Newby called the hospital to let the staff know they were arriving. They pulled up to the emergency room entrance, and Newby and Haddorff rolled the patient into a hospital room. The Montrose hospital staff took over, moving the patient from the gurney to a hospital bed as Newby updated them on the patient’s medical records.
Soon they were back in the ambulance, headed for home. “IFTs can be stressful,” said Haddorff as she maneuvered the twisty mountain road bathed in moonlight.
Pharmacies were once routinely bequeathed from one generation to the next, but, in interviews with more than a dozen pharmacists, many said the pressure of running an independent drugstore have them pushing their offspring toward other careers.
Ted Billinger Jr. liked to joke that he would work until he died. That turned out to be prophetic.
When Billinger died of a heart attack in 2019 at age 71, he was still running Teddy B’s, the pharmacy his father had started more than 65 years earlier in Cheyenne Wells, Colorado. With no other pharmacist to work at the store, prescriptions already counted out and sealed in bottles were suddenly locked away in a pharmacy that no one could enter. And Cheyenne Wells’ fewer than 800 residents were abruptly left without a drugstore.
Pharmacies were once routinely bequeathed from one generation to the next, but, in interviews with more than a dozen pharmacists, many said the pressure of running an independent drugstore have them pushing their offspring toward other careers. And when they search for a buyer, they often find that attracting new pharmacists, especially to rural settings, is difficult. With a large group of pharmacists nearing retirement age, more communities may lose their only drugstore.
“It’s going to be harder to attract people and to pay them,” said David Kreling, a professor emeritus at the University of Wisconsin-Madison School of Pharmacy. “If there’s not a generational thing where someone can sit down with their son or daughter and say that they could take the store over, there’s a good chance that pharmacy will evaporate.”
Tom Davis, Billinger’s friend and co-owner of Kiowa Drug in Eads, Colorado, stepped in to sort out the mess in Cheyenne Wells. With permission from the State Board of Pharmacy, the county sheriff let Davis into Teddy B’s in the eastern Colorado town to take an inventory of the remaining drugs. Customers who had dropped off their prescriptions before Billinger died were able to pick up their medications.
Davis then bought the pharmacy from Billinger’s estate. He runs it as a convenience store and six days a week delivers prescriptions to it from Eads, 44 miles away.
“By the time you paid a pharmacist, the location there was borderline unprofitable,” Davis said.
He has received numerous requests to open pharmacies in other eastern Colorado towns, but making that work financially would be difficult. Reimbursements from insurance plans have dwindled, and customer bases have eroded as health insurers push patients toward mail-order deliveries.
“I fill prescriptions every day where my reimbursement is less than the cost of the drug,” Davis said. “In other settings, you might tell a patient, ‘We don’t have that in stock,’ or ‘Why don’t you go down the street to the chain?’ But down here, we just take care of our patients, and we just eat it.”
He can survive, he said, because, after 48 years, he no longer has any business debt.
“I look at my bottom line,” Davis said. “With the amount of profit that I had at the end of the year, that would not have been enough if I was having to pay a mortgage.”
Studies have found the number of pharmacists nationally to be sufficient, even more than enough, to meet current needs, although supply and demand don’t always line up. Finding pharmacists is more difficult in rural areas.
“Once they get a taste of the big city,” Kreling said, “it’s hard to get them back to the farm.”
Workforce data also shows worrisome trends. Concerns about a shortage of pharmacists led the federal government to pour money into pharmacy schools in the 1970s, creating a temporary bump in the number of graduates. The people in that bulge in the pharmacist pipeline have hit retirement age.
“Many of them owned independent pharmacies, and they were working in rural communities,” said University of Minnesota pharmacy professor Jon Schommer, who studies workforce issues.
Now, as the demand for pharmacists to provide testing and vaccinations during the covid-19 pandemic increases, drugstore chains are offering incentives — such as large salaries, signing bonuses and help paying off school loans — that are often more enticing than anything a rural pharmacy could muster.
How pharmacy graduates envision their careers has also shifted. Many no longer want to own a pharmacy and are content to work at pharmacy chains or other health care organizations, according to several pharmacy school professors. As of 2018, only about half of pharmacists worked in traditional retail drugstores.
That makes rural recruitment more difficult.
Denise Robins had worked at R&R Family Pharmacy in Springfield, Colorado, for 18 years when the owner retired. She and three family members bought the drugstore in a last-ditch effort to keep it open.
“None of us are pharmacists, so that made it a little tougher,” Robins said. “We just knew it was really going to make it hard for people here if they had to travel an hour to get to a pharmacy.”
But finding a pharmacist to work in the southeastern Colorado town of fewer than 1,400 people was a challenge. The first pharmacist Robins found commuted 48 miles one way from Lamar. But after a year and a half, the trip became too much.
She then hired someone who wanted to work for only a year, to make enough money to travel. Then Robins interviewed two University of Colorado pharmacy school graduates. She hired one, but that didn’t work out. So she called back the second candidate, who still had not found a permanent job. He had two young kids, and he and his wife were working opposite schedules. He took the job two years ago and has remained there since.
In Berryville, Virginia, pharmacist Patricia White opened Battletown Pharmacy in 2011 because she wanted to carry on the family business. Her father had owned a local pharmacy and had recently died. But when turning a profit with Battletown proved a struggle, White decided to retire.
She lined up two potential buyers, but neither went through with the sale. She then hoped to transfer the pharmacy to a recent graduate but didn’t want to saddle him with a failing business.
“I told him he couldn’t make any money, and he said, ‘Thanks for being honest,’” White recalled.
Closing seemed like the only palatable option. Battletown shut down at the end of August. “I did not want to sell out to a chain,” she said. “That’s always been my mentality.”
When a chain buys a pharmacy, it doesn’t always decide to run it. Instead, it might close the pharmacy and transfer the pharmacy’s prescription files to one of its outlets. Retiring pharmacists who spent decades serving a community generally don’t want to see that happen, said David Zgarrick, a Northeastern University pharmacy professor.
“They’d like to sell their pharmacy to another pharmacist who would continue to run it very much in the same manner,” he said.
Some plan ahead, hiring another pharmacist and offering that person an equity stake in the business. Over time, the new pharmacist can buy out the owner. Many independent pharmacist-owners plan to live off the profits from selling their pharmacy, its inventory and its prescription records.
“Their pharmacy is their retirement savings,” Zgarrick said.
But, Zgarrick said, the added pressure from the pandemic may be pushing more pharmacists into retirement. And a long-running bull stock market may mean some pharmacists have enough in their retirement portfolios to call it quits without a sale.
In Eads, Davis, 70, still loves being a pharmacist. He and his brother co-own seven pharmacies and have started to plan for retirement by hiring five young pharmacists and allowing them to buy ownership stakes in those pharmacies over time.
He had wondered how long he could keep the Kiowa pharmacy running, though. With fewer than 700 residents, Eads may be the smallest town in Colorado with a pharmacy. Combining Davis’ customer base with Cheyenne Wells’ may have saved pharmacy access for both communities.
“So maybe where we could have lost two pharmacies in the area, we’ve been able to exist. We’re stronger now than we had ever been,” Davis said. “That wasn’t the original plan. We cared about those people and just wanted to take care of them.”
Hospitals say the fees, which can add hundreds of dollars or even more than $1,000 to a patient’s bill, are necessary to cover the high cost of keeping a hospital open and ready to provide care 24/7.
When Arielle Harrison’s 9-year-old needed to see a pediatric specialist at Yale New Haven Health System in June, a telehealth visit seemed like a great option. Since her son wasn’t yet eligible to be vaccinated against covid-19, they could connect with the doctor via video and avoid venturing into a germy medical facility.
Days before the appointment, she got a notice from the hospital informing her that she would receive two bills for the visit. One would be for the doctor’s services. The second would be for a hospital facility fee, even though she and her son would be at home in Cheshire, Connecticut, and never set foot in any hospital-affiliated building.
Harrison, 40, who works in nonprofit communications, posted on Twitter about the unwelcome fee, including an image of Marge Simpson of TV’s The Simpsons with a disgusted look on her face, captioned “GROANS.”
She called the billing office the next morning and was told the facility fee is based on where the doctor is located. Since the doctor would be on hospital property, the hospital would charge a facility fee of between $50 and $350, depending on her insurance coverage.
“It’s just one of many examples of how this is a very difficult system to use,” Harrison said, referring to the intricacies of U.S. health care.
Hospital facility fees have long come under criticism from patients and consumer advocates. Hospitals say the fees, which can add hundreds of dollars or even more than $1,000 to a patient’s bill, are necessary to cover the high cost of keeping a hospital open and ready to provide care 24/7.
But it’s not only hospital visits that result in facility fees. Over the past several years, hospitals have been on a buying binge, snapping up physician practices that often then begin charging the fees, too. Patients seeing the same doctor for the same care as at earlier visits are now on the hook for the extra fee — because of a change in ownership.
Charging a facility fee for a video visit where the patient logs in from their living room is even more of a head-scratcher.
“The charges seem crazy,” said Ted Doolittle, who heads up Connecticut’s Office of the Healthcare Advocate, which provides help to consumers with health coverage issues. “It rankles, and it should.”
Facility fees for video appointments remain rare, health finance experts say, even as the use of telehealth has soared during the covid pandemic. Medicare has allowed hospitals to assess a small fee for certain beneficiaries who get telehealth care at home during the ongoing national public health emergency, and people in private health plans may also be charged for them.
Harrison, however, was lucky. Doolittle reached out to her after seeing her tweet to offer his office’s assistance. In Connecticut, hospitals are prohibited from charging facility fees for telehealth visits.
Connecticut imposed what may be the only state ban on telehealth facility fees as part of a broader law passed in May that was intended to help residents access telehealth during the pandemic. The prohibition on facility fees sunsets at the end of June 2023.
Pat McCabe, senior vice president of finance at Yale New Haven Health System, said he can’t explain why Harrison received a notice that she’d be charged a facility fee for a telehealth visit. He speculated that her son’s appointment might have been coded incorrectly. Under the new law, he said, the health system hasn’t charged any telehealth patients a facility fee.
But such fees are justified, McCabe said.
“It offsets the cost of the software we use to facilitate the telehealth visits, and we do still have to keep the lights on,” he said, noting that the providers doing telehealth visits are on hospital sites that incur heat and power and maintenance charges.
The American Hospital Association didn’t respond to requests for comment about the rationale for facility fees for telehealth care.
As the pandemic began overwhelming the health system last year, hospitals essentially closed their doors to most non-covid patients.
Telehealth visits, which made up about 1% of medical visits before the pandemic, jumped to roughly 50% at its height last year, said Kyle Zebley, vice president of public policy at the nonprofit American Telemedicine Association, which promotes this type of care. Those appointments have dropped off and now make up roughly 15% of medical visits across all types of coverage.
Before the pandemic, the Centers for Medicare & Medicaid Services severely limited telehealth coverage for Medicare fee-for-service beneficiaries. But with seniors more vulnerable during the pandemic, the agency loosened telehealth rules temporarily. As long as the public health emergency continues, the agency is allowing Medicare beneficiaries in urban areas to receive such care, which was previously covered only in rural areas. And patients can get telehealth care at home rather than having to go to a medical facility for the video appointment, as was previously required. The agency also beefed up covered telehealth services and expanded the types of providers who are allowed to offer them.
Medicare lets hospital outpatient departments bill about $27 for telehealth visits for certain beneficiaries receiving care at home. Patients are generally responsible for 20% of that amount, or about $5, although providers can waive patient cost sharing for telehealth, said Juliette Cubanski, deputy director of the Program on Medicare Policy at KFF.
At the beginning of the pandemic, patients with commercial health plans were often not charged a copay for telehealth visits, said Rick Gundling, a senior vice president at the Healthcare Financial Management Association, a membership group for health care finance professionals. But lately, “those fees have been coming back,” he said.
Facility fees for telehealth visits in commercial plans averaged $55 for the year that ended June 30, before insurance discounts, according to data from Fair Health, a national independent nonprofit that maintains a large database of insurance claims. In 2020, just 1.1% of commercial telehealth claims included a facility fee, according to Fair Health. That’s lower than for 2019, when the figure was 2.5%.
Experts predict telehealth will remain popular, but it’s unclear how those visits and any accompanying facility fees will be handled in the future.
McCabe said he expects the Yale New Haven Health System to reinstitute the facility fees when state law permits it.
“There are real costs in the health system to provide those services,” he said.
As deadly coronavirus cases spiked this year, daily pressures intensified on hospital floors. Some nurses retired; some became travel nurses, hired by agencies that advertised more than double, even triple, the day rates for intensive care unit, telemetry and emergency room nurses. Others gave up their jobs to avoid possibly carrying the covid virus home to their families.
Nurses and health care workers across the country are finding strength in numbers and with labor actions not seen in years.
In California, which has a strong union tradition, Kaiser Permanente management misjudged workplace tensions during the covid-19 crisis and risked a walkout of thousands when union nurses balked at signing a four-year contract that would have slashed pay for new hires. In Colorado, Pennsylvania, North Carolina and Massachusetts, nurses have been embroiled in union battles over staffing and work conditions.
As deadly coronavirus cases spiked this year, daily pressures intensified on hospital floors. Some nurses retired; some became travel nurses, hired by agencies that advertised more than double, even triple, the day rates for intensive care unit, telemetry and emergency room nurses. Others gave up their jobs to avoid possibly carrying the covid virus home to their families.
“Things had gotten particularly stark for nurses,” said Rebecca Kolins Givan, an associate professor of labor studies at Rutgers University.
‘They Can Make More at McDonald’s’
It was so grim in Pittsburgh that registered nurses at West Penn Hospital, part of the Allegheny Health Network, voted this year to authorize a strike — less than a year after they unionized with SEIU Healthcare Pennsylvania. Chief among their complaints: The hospital system had balked at improving staff ratios even as it offered bonuses, up to $15,000 for some, to hire registered nurses to fill vacancies.
Kathleen Jae, a member of the bargaining team that reached a pact without a work stoppage, said nurses wanted management to work harder to retain veteran staff members: “We had to face the fact that nurses are retiring, nurses are leaving the bedside out of frustration, and, in certain instances this year, nurses had more patients than they felt comfortable taking care of.”
Allegheny Health Network said the first-ever pact with RNs at West Penn provides “competitive wages and benefits” to help it “recruit and retain talented, experienced nurses.”
Liz Soriano-Clark, a teacher-turned-nurse on the bargaining team, said the pandemic had made workers across the health sector more careful and choosier about what jobs they’ll take.
“There’s a nursing shortage and a shortage of nursing instructors, nationwide. They’ve seen aides leave. They’ve seen cleaners leave,” Soriano-Clark said. “Why is that? Because they can make more at McDonald’s and not have to clean up vomit.”
In September, the American Nurses Association alerted the Biden administration to an “unsustainable nurse staffing shortage facing our country” in a letter to the Department of Health and Human Services. The ANA said a “crisis-level human resource shortage” was evident: Mississippi had 2,000 fewer nurses than it did at the beginning of 2021. Tennessee called on its National Guard to reinforce hospital staffs. Texas was recruiting 2,500 nurses from outside the state.
Union membership among U.S. nurses has inched up over the past 15 years and held steady, at about 17%, for five years, according to unionstats.com, an academic website. But 2021, a year of union organizing and holdouts in such disparate workplaces as Starbucks cafes and John Deere tractor plants, might well be a turning point for essential workers in health care.
“If you ask nurses what they want,” said Givan, who interviewed dozens of nurses for a 2016 book on health care workers, “they want working conditions where they can provide a high level of care. They don’t want appreciation that is lip service. They don’t want marketing campaigns. They don’t want shiny new buildings.”
Still, Givan noted, the health care sector has spent handsomely to fight unions.
After years of staff retention issues at Longmont United Hospital in Colorado, nurses are awaiting the results of a vote on whether to join National Nurses United, the largest union of registered nurses in the U.S.
Stephanie Chrisley, a registered nurse in the hospital’s ICU, said nurses are regularly caring for double the number of patients considered appropriate — often three to four “ventilated, sedated, critically ill patients.”
She and others protested outside the hospital in early December. They said the company that runs the hospital, Centura Health, this year had employed aggressive union-busting tactics, including disputing a handful of votes, which dragged out the union election for about five months. In another instance, her colleague Kris Kloster said, Centura, founded by Catholic nuns, issued company-wide emails announcing raises and retention bonuses for everyone except nurses at her hospital.
“Where there should have been newly hired nurses, there were anti-union consultants roaming around the hospital,” Chrisley said. Since July, she added, the hospital has lost nearly 80 RNs, “nearly a third of our nursing staff.” Longmont United Hospital Interim CEO Kristi Olson said in a statement that the hospital “will remain open and fully operational” and that “we are committed to making sure that all voices were heard” in the union election.
Organizing can take a long time, Givan said, pointing to tense labor negotiations in Massachusetts, North Carolina and Pennsylvania. “But when there is a crisis — what we call a hot shop — you can get workers to organize quite quickly.” Nurses represented by the Massachusetts Nurses Association walked off the job March 8 in Worcester. A chance to break the bitter impasse collapsed when management, Tenet Healthcare, refused to allow some nurses to return to their original jobs. In North Carolina, registered nurses at Mission Hospital in Asheville ratified a contract with the HCA management that locked in 17% raises over three years and set up a committee to review patient care conditions.
A recent poll by Gallup, the global analytics firm, found that the share of Americans who say they approved of unions was at 68%, its highest point since 1965.
Sal Rosselli, president of the National Union of Healthcare Workers, said that in the past year “there has just been an explosion of leads,” queries from health workers exploring how to unionize.
Rosselli, whose organization represents about 15,000 health workers, said the pandemic exposed practices that had long antagonized employees. Too many hospitals scrambled for masks, gloves and gowns, he said, and front-line workers were on round-the-clock schedules and facing ghastly daily deaths. “They weren’t keeping their employees and their patients safe,” Rosselli said, “and all because these systems were focused on profit over anything else. That has been coming on for a long, long time.”
Registered nursing is among the U.S. occupations expected to experience the greatest levels of job growth in the next decade, according to the Bureau of Labor Statistics’ Employment Projections 2020-2030. Also among the fastest-growing occupations are nurse practitioners, home health care aides and assistants. Shortages of RNs and other health care workers are expected to be the most intense in the South and West.
Some of the most powerful nursing unions in the nation operate out of California, representing employees in Western states. “The nurses in California have the hours they have, the care they have, the protections they have because of the union,” said Soriano-Clark, who has worked at hospitals in California and Pennsylvania.
Ready to Picket in a Pandemic
Douglas Wong, a physician assistant, never imagined hoisting a “strike” sign outside Riverside Medical Center. But that nearly happened after a sobering breakdown in talks between Kaiser Permanente and a top nurses union at the facility, part of the KP system. Nurses, pharmacists and operations staffers are among the insurers’ 160,000-plus unionized employees, according to KP spokesperson Marc Brown.
The California-based health system giant tried to force a two-tier pay schedule that would have cut wages for new nurses by 26%. Wong and thousands of allies — many who dryly noted they had been heralded as “heroes” in the covid crisis — prepared to picket in the middle of a pandemic. Kaiser Permanente’s demands crumbled when dozens of affiliated unions threatened one-day sympathy strikes.
The tiered-pay demand and an attempt to lower wages in some markets were dropped. Staffing ratios were adjusted to ease safety concerns. Wong said that, despite the pact, the bruising negotiations “felt like a betrayal.”
“Make no mistake: This was an enormous win for labor, especially pushing back on the two-tier. At the end of the day, they pulled back. And we made huge strides toward improvement in our staffing,” said Wong, a six-year KP employee and an official with the United Nurses Associations of California/Union of Health Care Professionals.
The negotiations were a marked shift for Kaiser Permanente, which for most of three decades has relied on a labor-management partnership with its unions, emphasizing cooperative decision-making and robust discussions. Talks were held with teams, set around circular tables, hashing out concerns. KP was known for much of the past decade as a market leader in wages and quality of care, and the labor-management partnership was received by academics and labor experts as an innovative, successful approach to managing a workforce.
The health system recently hired new top executives, and, to the surprise of the unions, Kaiser Permanente used negotiations this year to offer the two-tier pay regimen, a tactic used by auto- and steel-makers during economic downturns in the 1980s. The union negotiators noted this: The health care giant’s management wanted to scale back wages after notching $6.8 billion in net revenue from 2018 to 2020.
On Thursday, workers voted to ratify a four-year contract with KP. The company declined to comment for this article. In a news release, Christian Meisner, KP’s chief human resources officer, said: “This contract reflects our deep appreciation for the extraordinary commitment and dedication of our employees” during the pandemic. “We look forward to working together with our labor partners,” he said, to “further our mission of providing high-quality, affordable care.”
The Wall Street Journal recently reported that nurses’ pay was sweetened in 2021 by thousands of dollars in raises — handed out without union wrangling — as hospitals competed for workers. Premier, a health care consultancy hired by the Journal, analyzed 60,000 registered nurses’ salaries and found that average annual pay, not including overtime or bonuses, grew about 4% in the first nine months of the year, to more than $81,000. That compares with a 2.6% rise in 2019, according to federal data.
Raises don’t necessarily mean retention.
“There always seems to be a shortage of nurses,” said professor Paul Clark, who is a former director of Penn State University’s School of Labor and Employment Relations and has studied nursing and labor organizing. “But it’s important to realize there’s not a shortage of RNs. There’s a shortage of RNs willing to work under the conditions they’ve been asked to work.”
Aya Healthcare, a national travel nurse provider, has found that the pandemic aggravated historical understaffing at hospitals, spokesperson Lisa Park said in an email. “There were over 100,000 vacancies at the start of the pandemic. And now, that number has increased to over 195,000,” Park said. Travel nurses account for fewer than 2% of the nursing workforce, she added, but “with the increase in permanent vacancies due to burnout/resignations, the demand for temporary healthcare workers has increased.”
David Zonderman, a professor of labor history at North Carolina State University, noted that nurses unions have grown more political and more outspoken — in Washington, D.C., and their home states. Nurses on the hospital floor lived through a crisis — fearing for their lives amid shortages of protective equipment — much like the trials of American workers in the mining and manufacturing industries in decades past.
“This may sound weird,” Zonderman said, “but nurses are a little like coal miners. They tend to help each other. They are watching each other’s back. They have solidarity.”
“And,” he said, “if you treat people badly long enough, they finally say, ‘I’m done.’”
Covid-19’s unrelenting spread exposed deep, systemic problems with the quality of care — or lack thereof — at nursing homes across the country. In the nation’s most populous state, the industry’s track record during the pandemic is spurring leaders to radically rethink how it pays and oversees them.
SACRAMENTO, Calif. — About 1 in 8 Californians who have died of covid lived in a nursing home.
They were among the state’s most frail residents: nearly 9,400 mothers, fathers, grandparents, aunts and uncles whom Californians entrusted to a nursing home’s care. An additional 56,275 confirmed covid cases among nursing home residents weren’t fatal.
“The number of covid infections and deaths that happened in skilled nursing facilities in California is truly appalling,” Jim Wood, a Democrat who chairs the state Assembly Health Committee, said at a recent hearing he convened on nursing homes. “I expect better from us.”
Covid-19’s unrelenting spread exposed deep, systemic problems with the quality of care — or lack thereof — at nursing homes across the country. In the nation’s most populous state, the industry’s track record during the pandemic is spurring leaders to radically rethink how it pays and oversees them.
Gov. Gavin Newsom’s administration is drafting a proposal to tie state funding more directly to performance: Among the state’s roughly 1,200 skilled nursing facilities, those that meet new quality standards would get a larger share of state funding than those that don’t.
But exactly how the Golden State would measure quality care and allocate the roughly $5.45 billion a year that nursing homes collectively receive is far from settled — and promises to spark one of 2022’s biggest health care fights. When the legislature debates those details as part of state budget negotiations, the nursing home industry vows to oppose any proposal tying Medicaid payments to quality metrics such as staffing levels, pay and turnover.
In fact, the industry plans to argue it needs more money to deliver better results — and it wields substantial power in the Capitol.
In the past decade, it has spent at least $10 million to influence lawmakers and has given one or more political donations to Newsom and at least 105 current members of the 120-member legislature, according to a KHN analysis of campaign finance records.
But patient advocates and family members who lost loved ones in nursing facilities during the pandemic are mobilizing a counterattack to convince lawmakers that now is the time to overhaul the system.
“There are a lot of problems people have complained about for a long time,” said Charlene Harrington, a professor emerita of social and behavioral sciences at the University of California-San Francisco and an expert on nursing homes. “This is an opportunity to correct those problems.”
At least 140,790 covid deaths have been reported in U.S. nursing homes, according to the latest data from the Centers for Disease Control and Prevention. Older adults have a heightened risk of dying of covid, and the coronavirus spreads more easily in institutional settings such as nursing homes and assisted living facilities.
That’s one reason Craig Cornett, CEO of the California Association of Health Facilities, thinks blaming nursing homes for high covid infection rates, especially early in the pandemic, is unfair. Not only are their residents naturally at higher risk than the rest of the public, he said, but the facilities were forced to accept hospital transfer patients who had not been tested for the virus, they couldn’t get adequate supplies of personal protective equipment, and they suffered as staff members got covid in the community and then brought it into work.
But multiple studies inCalifornia andelsewhere have found that nursing homes with fewer nursing staff members experienced significantly higher covid infection and death rates. That devastating outcome is bolstering a two-decades-long argument by patient advocates that nursing homes must hire more workers.
“Some of these problems that we saw in the pandemic could have been avoided if nursing homes had adequate staffing,” said Harrington, who co-authored a December 2020 study for the California Health Care Foundation that showed nursing homes with lower staffing levels earlier that year had twice the covid case rates than those with higher staffing levels. (California Healthline is an editorially independent publication of the foundation.)
Some lawmakers and patient advocates suggest that the best way to improve care is to boost staffing, and that the best way to achieve that is to alter the complicated formulas that determine the daily rate nursing homes are paid by Medicaid, the government insurance program that covers about two-thirds of nursing home residents.
Currently, Medicaid reimburses a portion of what nursing homes spend on staff, administrative and other expenses, paying them a higher proportion for staff costs than administrative costs. Facilities can receive bonus payments for meeting quality standards — although the bonuses are limited and have been criticized for not boosting performance at facilities that need it most.
The California Department of Health Care Services, which administers the state’s Medicaid program, called Medi-Cal, is drafting a plan that would do away with the bonus payments and integrate quality measures into the daily Medi-Cal payment rates nursing homes receive. The department is considering multiple ways to measure quality, spokesperson Anthony Cava said in a statement: Nursing homes that offer more staff education and training could receive higher per diem rates, as could those that have more staff and less staff turnover.
That’s a non-starter for the nursing home industry, which doesn’t consider staffing to be an appropriate measure of how well residents do. Rather, Cornett, whose lobbying group represents more than 800 nursing homes, said facilities should be graded on the number of patient falls and infections, as well as patients’ abilities to perform daily activities.
“We want more staff and want to pay our staff,” Cornett said. “But we need the state to change the system so we can get more money into the staffing line. And that’s going to require a higher amount of money.”
Nursing homes warn that a heavy focus on staffing misses other critical costs of running a facility safely. Even under the current reimbursement system, they say, facilities are scraping by.
“Not all of the costs in a facility are for staff. Skilled nursing facilities, like other healthcare providers, have a variety of costs including medical supplies, consulting, real estate, taxes, administrative services, overhead and many others,” said Mark Johnson, an attorney for Brius Healthcare, one of the largest nursing chains in California.
Whether lawmakers will be sympathetic to the industry’s plea for more money is questionable. They are increasingly demanding transparency about how skilled nursing facilities make and spend their money. Like hospitals and other health care providers, nursing facilities have received billions of dollars in federal covid relief funding to help offset the costs of hiring temporary workers, testing and protective gear. It isn’t lost on lawmakers that this $12 billion industry is attracting a growing number of private investors who are buying ownership shares in their facilities.
“That tells me there’s money out there, there’s profit out there,” said Wood, who also sits on the budget subcommittee that will review the administration’s proposal. “Private equity is not going to go into facilities if they don’t have a chance to make a pretty significant return.”
There’s a lot at stake for the roughly 400,000 residents of nursing homes in the state — and for the industry, which is a big spender and a powerful force in Sacramento.
The California Association of Health Facilities has given just over $2 million in contributions and spent $5.67 million lobbying lawmakers in the past 10 years, from Jan. 1, 2011, through Sept. 30, 2021, according to records filed with the California secretary of state’s office. And Cornett, its CEO, is a veteran of the state Capitol who worked as the top budget aide to four former Assembly speakers and two Senate leaders.
During that time frame, 50 of California’s largest individual and corporate nursing home owners and operators have given a combined $2.6 million directly to lawmakers, the Republican and Democratic state political parties and ballot measures. That figure is likely an undercount because it is difficult to identify everyone with an ownership stake in a nursing home or chain. Facilities are often partially owned by real estate investors, venture capital firms and other business interests not listed on government records.
Cornett downplayed his industry’s influence and said trial lawyers are the players with deep pockets and are funding the patient advocates, an allegation those groups dispute.
But a2018 report by the California State Auditor found that the three largest private operators — Brius Healthcare, Plum Healthcare Group and Longwood Management Corp. — are highly profitable. Their combined 2006 net income of $10 million grew to between $35 million and $54 million by 2015, the most recent year the state auditor analyzed.
Patient advocates say those profits negate the industry’s argument for needing more taxpayer dollars.
“To some extent, the state is being bamboozled with this idea that the money that they’re paying now is not enough to do the job that we’ve asked them to do,” said Tony Chicotel, an attorney with California Advocates for Nursing Home Reform. “The bottom line is it goes to profit.”
Methodology
KHN analyzed campaign finance records filed with the California secretary of state’s office from Jan. 1, 2011, through Sept. 30, 2021.
We downloaded contributions made by the California Association of Health Facilities, the organization that represents the industry in Sacramento.
To determine how much nursing homes have contributed directly to political campaigns, we identified 50 of California’s largest individual and corporate skilled nursing home owners using data published by the Centers for Medicare & Medicaid Services. We connected those owners to nursing home chains and management companies that run nursing homes.
We then searched each entity and individual on the secretary of state’s website to see if they made any political contributions. We did not include money they gave to the California Association of Health Facilities to ensure we did not double-count contributions.
To track lobbying, we created a spreadsheet of expenses reported on lobbying disclosure forms from Jan. 1, 2011, through Sept. 30, 2021, also available on the secretary of state’s website, by the California Association of Health Facilities. None of the nursing home companies we identified spent any money directly lobbying lawmakers. Instead, they gave money to the association.
Phillip Reese, an assistant professor of journalism at California State University-Sacramento, contributed to this report.
Patients with other ailments are frustrated, and nurses and doctors are stressed and burned out, as unvaccinated covid-19 patients fill ICU and acute care beds.
Harold Burch's home has a spectacular view in Paonia, a rural part of Colorado's Western Slope at the foot of Mount Lamborn. But the landscape has been little consolation to the 60-year-old as he has battled a cascade of health problems during the pandemic.
"It's been a real rodeo," Burch said. "It's been a lot of ups and downs and lately it's been mostly just downers."
Burch has battled chronic osteoarthritis and rheumatoid arthritis and has had two major intestinal surgeries. One specialist he was seeing left her practice last year. Another wouldn't accept his insurance. Then, Nov. 1, he started experiencing major stomach pain.
"When we talk terrible problems, I can't leave the house," he said. He hasn't eaten anything substantial in three weeks, he added.
Burch had to wait that long to be seen by a primary care doctor. He said the doctor told him, "‘If things were different, I would tell you to go to the hospital and be diagnosed, have some tests run and see what's going on with you.' But he says, ‘As of today, Delta County hospital is clear full. There are no beds available.'"
The covid variant delta has overwhelmed the Colorado county of the same name. Hospitals on the Western Slope have been slammed for weeks, and the statewide picture is similarly grim. As of Monday, the state's coronavirus website reported 1,294 patients hospitalized with covid-19. Half of the state's hospitals said they anticipated a staffing shortage in mid-December; more than a third of them anticipated bed shortages in their intensive care units at the same time.
And behind those numbers, patients are feeling the impact.
Burch's doctor told him he might have to wait hours in the emergency room, perhaps with people who have flu or covid symptoms. So Burch stayed home.
"It's really frustrating because I did the right thing and like so many other people have, and we're being just kind of like told, ‘Unless you have a really serious problem, like a heart attack, a stroke, you're going to have a baby or something like that, we really don't have time to mess with you,'" Burch said. "I mean, it's just wrong."
Burch's situation is not uncommon this fall, as the state faces its second-worst covid surge for hospitalizations and deaths. Hospitals are under tremendous strain and that means delays and changes from normal care, as strapped providers do more with less.
"Hospitals across Colorado are in critical condition. We have been at 90%-plus capacity in our ICU and acute care beds for weeks now. And unfortunately, there doesn't appear to be an end to that situation in the near future," said Cara Welch, a spokesperson for the Colorado Hospital Association.
Diann Cullen, 72, a retiree in Broomfield, Colorado, was told by her doctor that her hernia surgery would have to be postponed for weeks. Her reaction: "Frustration, extreme frustration, actually anger, because I said a bad word. … He flat-out told me we can't even do it because of too many covid patients."
The combination of too many covid patients, the need to treat those who delayed care and staff shortages have pushed hospitals into crisis, said Robin Wittenstein, CEO of Denver Health, which runs one of the state's biggest hospital and clinic systems.
"They're coming into hospitals now sicker than ever before. And they're coming in larger numbers than we've ever seen before," Wittenstein said on the day when most metro-area counties announced they were enacting a new indoor, public mask mandate. "Our system is on the brink of collapse."
At the academic medical center UCHealth, Dr. Abbey Lara said the crush of unvaccinated patients in the ICU means patients face longer waits or they don't get much-needed diagnostic tests. In the worst-case scenario, "patients who could have survived something had their life cut short because they weren't able to access care," she said.
And when there are too many patients being treated by too few staffers, Lara said, that ratchets up the difficulty for providers.
"I just worry that there's going to be not only a lot of turnover in the near future," Lara said. "But I think that access to health care is just going to get even worse in the future."
Lara predicted the effects of the pandemic will be felt long after the emergency ends: "The sky isn't falling, but the sky is going to turn a very different color."
In Longmont, Colorado, about 50 miles north of Denver, nearly a third of Longmont United Hospital's registered nurses have left since the start of July and many have not been replaced, said Kris Kloster, who has been a nurse for 32 years. She is backing an effort by nurses to unionize there.
The stress nurses and doctors feel is compounded when they feel powerless to take what they regard as an ethically correct action in treating a patient.
There's a term for that, "moral distress," said Dr. Barbara Statland, a hospitalist at Denver Health. The tension comes "because you can't do what you feel is ethically proper. And I'd say that health care workers have been riddled with this."
Despite the stress and distress, many front-line providers are hanging in there, continuing to care for patients every day. That made the difference for at least one covid patient who said he was appreciative he was able to get care — just in time.
"They saved my life. I do feel grateful for everything they did," said 58-year-old Rob Blessin, of Fort Collins.
He caught the virus this fall and spent 30 days in an ICU ward with pneumonia at North Colorado Medical Center in Greeley. He described the efforts of his doctors and nurses as heroic, some working nine or 10 days in a row, many taking overtime. And others, Blessin said, were filling in.
"So often you'd have people from different departments being trained on the fly," Blessin said. "So there's a lot of pressure on people. They're just trying to get warm bodies in there."
Respiratory therapists are in short supply in hospitals, and Blessin said as more coronavirus patients were admitted, the staff struggled to keep up.
Blessin said he landed in the hospital because he was swayed by internet misinformation and didn't get vaccinated. It's a decision he came to regret.
"I guess my recommendation would be to get vaxed, you know, even if you're totally against it; don't fall into the internet hype," Blessin said.
After his experience being hospitalized for a month due to the coronavirus, and having talked with his physicians there, he now plans to get vaccinated.
In January, California's Medicaid program will begin offering nontraditional services, such as ridding homes of roaches, replacing mattresses and installing air purifiers, to some low-income asthma patients. But the rollout could be chaotic, with insurance companies struggling to identify groups that can deliver the services.
MADERA, Calif. — Growing up amid the dusty agricultural fields of the Central Valley, Ruby Marentes-Cabrera can't recall a time when it wasn't difficult to breathe.
Diagnosed with asthma early in childhood, the ninth grader has come to detest the pistachio trees that surround her home because the dust, pesticides and other allergens that blow off the orchards often trigger an asthma attack — even infiltrating her home so that simple chores like vacuuming can be dangerous.
"We live so close to the fields — I breathe the dust and chemicals in," said Ruby, 14, describing coughing and wheezing fits calmed by puffs from her emergency inhaler or breathing treatments from a nebulizer. "It gets so bad that my back hurts, my head hurts, my lungs hurt. I get sick and it gets really hard to breathe."
Ruby is among roughly 2 million low-income Californians who have health insurance coverage from Medi-Cal, the state's Medicaid program, and have been diagnosed with asthma, a chronic and expensive disease that costs California billions of dollars per year in health care spending, missed work for parents and lost school days for kids.
The disease — exacerbated by air pollution and indoor threats like harsh cleaning products, cockroach infestations, dust and mold — hits low-income communities the hardest. Medi-Cal patients accounted for half the state's asthma-related emergency and urgent care visits in 2016, even though they represented about one-third of the population, according to data cited by state health officials.
Starting in January, California will embark on an ambitious experiment to control asthma in its most vulnerable patients. Medi-Cal will offer recipients like Ruby unconventional in-home "treatments" not traditionally considered health care: removing mold, installing air purifiers and even replacing carpeting, blinds and mattresses.
These new asthma benefits are just a small part of Gov. Gavin Newsom's sweeping $6 billion initiative to transform the largest Medicaid program in the country. The initiative, known as CalAIM, will target the state's sickest and most expensive patients and cover an array of new social services, including home-delivered healthy meals; help with grocery shopping, laundry and money management; and security deposits for homeless people in search of housing.
Newsom's goal is to lower soaring Medi-Cal spending — which hit an astronomical $124 billion this fiscal year — by preventing costly care such as emergency room visits. But state health officials acknowledge the new asthma benefits may not actually save taxpayer money.
Nor will the benefits be distributed equally: Because Medi-Cal managed-care insurance plans have immense power to decide which new services to offer and to whom, the initiative will create a patchwork of haves and have-nots. Of the 25 participating insurance companies, 11 will offer in-home asthma services starting in January in 36 of the state's 58 counties. Within those counties, some Medi-Cal recipients will qualify; others will not.
With just two weeks to go before the program debuts, many insurers are scrambling to establish networks of nonprofit organizations and private contractors that specialize in delivering in-home asthma services and home repairs.
In San Bernardino and Riverside counties, for example, about 400 patients served by the Inland Empire Health Plan — out of nearly 1.4 million Medi-Cal plan members — will have access to asthma services in the first year, largely because the insurer has identified only one organization equipped to handle the responsibility.
"If we don't do this right, this dream can become a nightmare," said Alexander Fajardo, executive director of El Sol Neighborhood Educational Center in San Bernardino, which is negotiating a contract with the insurer.
Fajardo said El Sol is frantically preparing. While his organization has experience providing asthma education, it doesn't have expertise in medical billing, patient privacy regulations and managed-care contracts.
"This is new, so we still have to learn," Fajardo said.
Jeanna Kendrick, the Inland Empire Health Plan's senior director of care integration, called the experiment to develop new social services "probably the hardest thing we've ever done." It pushes plans into uncharted territory, she said, contracting with community organizations and teaching them how to handle medical billing, for example.
"We really do need to be creative and have some wiggle room because this is brand-new for all of us," Kendrick said.
Jacey Cooper, California's Medicaid director, argued earlier this year that health plans will start small but add capacity over the five years of the initiative. The state is offering incentive payments to help plans launch new services and has set aside $300 million for the first half of 2022 alone.
The Department of Health Care Services, which administers Medi-Cal, could not say how many low-income Californians will receive new in-home asthma services, because they are voluntary, and as a result could not predict future costs. But Anthony Cava, a department spokesperson, cited data showing that more than 220,000 Medi-Cal recipients have poorly controlled asthma. The state pays $200 to $350 for a typical asthma-related emergency room visit, and $2,000 to $4,000 a day for a typical inpatient hospitalization, department officials said.
Agency officials couldn't confirm the asthma benefits will save money, saying the costs will be equal to or less than the costs of traditional medical treatments.
Under the program, health insurers will send contractors into houses and apartments to assess hazards and educate patients about conditions that can trigger asthma attacks. Insurance executives say they will consider approving any service that could help asthma patients — from replacing tattered carpets to buying nontoxic cleaning products and pillow dust covers — within the $7,500 lifetime cap for each Medi-Cal recipient. The services will be available to both renters and homeowners.
"It's not that somebody can just say they just want a brand-new $3,000 mattress," said Dr. Takashi Wada, chief medical officer for the Inland Empire Health Plan. "But we do think a lot of these asthma attacks are preventable, and by avoiding illness, you're also avoiding unnecessary hospital and emergency department visits."
Fresno and Madera counties have some of the worst air quality in the state. They also have the highest rates of childhood asthma-related ER visits in California, along with Imperial County on the Mexican border, according to 2019 state public health data.
Ruby and her family, who live in Madera, California, appear to be ideal candidates for state-funded asthma benefits, said Joel Ervice, associate director of Regional Asthma Management and Prevention, which lobbied for the new services. Both Ruby and her sister Yesenia, 20, have asthma and were frequent visitors to the ER during childhood.
But as in the Inland Empire, only a small share of Central Valley asthma patients will receive the new services initially. Ruby and her family hope they will be among the lucky ones but realize they may still have to rely on conventional treatments such as emergency inhalers — and the hospital if necessary.
"I'm taking my medication a lot right now — it would be good if my asthma got better," said Ruby, who wants to be able to play outside her home and excel in outdoor school activities. "I'm having a hard time running the mile in school, so being able to run would be so great for me and my health."
CalViva Health, a major insurer serving patients in the Central Valley, including the Marentes-Cabrera family, so far has identified one nonprofit organization to deliver services and is negotiating with others.
That organization, the Central California Asthma Collaborative, expects to be able to serve up to 500 people across seven counties next year. Unlike other nonprofit groups that are still assessing how to deliver services, the collaborative has already identified private contractors to remove mold, install bathroom or kitchen ventilation, and provide other services, co-director Kevin Hamilton said.
CalViva Health CEO Jeffrey Nkansah said asthma is one of the leading causes of hospitalization among the insurer's enrollees.
"But right now, these conversations around identifying partners to deliver these asthma remediation services are fluid," Nkansah said. "We're still working hard to make sure we can get those services in place for Jan. 1."
For the Marentes-Cabreras, the relentless clouds of dust and other toxins from orchards, combined with seasonal wildfire smoke, are the biggest problem. The particles infiltrate their lungs and their home, covering surfaces and caking the carpet, which they would like to replace. But they don't have the money.
For now, Sandra Cabrera uses nontoxic cleaning products and daughters Ruby and Yesenia track their lung capacity with oxygen meters.
"I am trying to control what's in the house to prevent them from getting sick, cleaning a lot and using different cleaners," Cabrera said in Spanish. "We could use help to do more, but it's really difficult."
As overdose deaths nationwide reach all-time highs, the Biden administration has made increasing access to naloxone a key part of its overdose prevention strategy. But advopcates say the administration hasn't addresses the greatest barrier: naloxone's prescription-only status.
Treatment for addiction is available. For help, call the free and confidential treatment referral hotline (1-800-662-HELP), or visit findtreatment.gov.
GREENSBORO, N.C. — Louise Vincent figures her group, the North Carolina Survivors Union, saves at least 1,690 lives a year.
The 1,690 number refers to how many times participants in the Survivors Union reported using the medication between July 2020 and June 2021. But the true number of lives saved could be higher: The program distributed nearly 9,400 doses of naloxone during that time.
But Vincent and her peers say the administration has not addressed their greatest barrier to obtaining the lifesaving medication: naloxone’s prescription-only status.
“This designation is the root of all evil,” said Nabarun Dasgupta, a scientist at the University of North Carolina’s school of public health and co-founder of the Buyers Club, a collective of more than 100 harm-reduction programs in the U.S.
The Food and Drug Administration approved naloxone as a prescription drug to treat opioid overdose in 1971, when it was only an injectable drug. That remains the cheapest form and the one used most by harm-reduction groups, which have long relied on a deal with Pfizer to buy the medication for less than $5 a dose. However, newer, nasal spray versions of naloxone — including the brand-name drug Narcan, which has a discounted price of about $38 a dose — are available in many police stations, libraries and schools.
All 50 states allow individuals to buy naloxone at the pharmacy without a prescription. States don’t have the authority to designate it as an over-the-counter medication, but they’ve created workarounds — such as a state health official writing one prescription that can be used for every resident. But these workarounds don’t apply to organizations that purchase naloxone in bulk from drugmakers. When a hospital, harm-reduction group or any other organization orders naloxone from pharmaceutical companies, the companies are required to treat naloxone the way the federal government sees it: as a prescription medication, Dasgupta said. As a result, the companies impose a series of requirements on buyers.
For example, an organization that orders naloxone must have a doctor sign for the order, and that doctor must be someone who has not signed for another group. The organization must also have an address that is not a private home to receive shipments, a medical or pharmacy license and the ability to comply with regulations for storing and dispensing the drugs.
Hospitals and health departments can easily fulfill these requirements. But they can be onerous for smaller, grassroots groups, many of which are led by volunteers and operate out of makeshift home or car offices, said Eliza Wheeler and Maya Doe-Simkins, co-founders of the Buyers Club and co-authors of a paper with Dasgupta on this subject.
When these groups can’t order naloxone, the people they serve can die, Wheeler and Doe-Simkins said.
Those clients won’t necessarily turn to pharmacies. Indeed, as overdose deaths surged in 2020, pharmacy sales of naloxone decreased. The cost of the medication, requirements to show ID, a fear of discrimination from pharmacists and an inability to find a pharmacy that stocks naloxone are all barriers, said West Virginia University researcher Robin Pollini, who studies naloxone distribution.
So harm-reduction groups are calling on the FDA to allow naloxone to be sold over-the-counter so they can order it more easily and distribute it to the people at the greatest risk of overdosing.
The product has long been deemed safe and effective for community use, harm-reduction groups say, even by the FDA. Other advocates have suggested that the Department of Health and Human Services issue an order allowing manufacturers to sell naloxone to organizations buying in bulk without a prescriber’s signoff.
“Having more naloxone on the street can only do good. It can’t do harm,” said Thomas Stopka, an epidemiologist and substance use researcher at Tufts University School of Medicine. “We need to pull out all the stops and consider a bunch of different avenues to address this issue of supply.”
The concern was highlighted this year when a manufacturing problem depleted Pfizer’s stock of naloxone and the company couldn’t fill orders for harm-reduction groups. Hikma, another company that makes naloxone, offered to donate 50,000 injectable doses to the affected groups. But because of naloxone’s prescription status and Hikma’s associated paperwork requirements, only three harm-reduction programs qualified, Dasgupta said. (Pfizer said that the manufacturing issue has been resolved and that shipments resumed this fall.)
In Oklahoma, Stop Harm on Tulsa Streets (SHOTS) didn’t qualify for Hikma’s donation because the group didn’t have a doctor who could sign for its order, co-founder Hana Fields said. The doctor the group had previously worked with retired in January, and SHOTS had yet to find a replacement. Many doctors are worried about liability or simply don’t return her calls, she said. In the meantime, SHOTS relies on naloxone donations from other programs.
“The stakes are so high. My friends are dying,” said Fields, whose life has been saved by naloxone and who has been in recovery for seven years.
In a statement to KHN, the FDA laid responsibility on the companies making naloxone, saying it has encouraged pharmaceutical manufacturers to apply for over-the-counter designation for years, even doing the legwork to develop consumer-friendly labels that are typically the purview of companies.
“We continue to hope that one or more sponsors will submit an application, as this would be the most direct regulatory path for the FDA to be able to approve a non-prescription naloxone,” the agency said.
But when, or if, that’ll happen is unclear.
Pfizer and Hikma told KHN that they do not have current plans to pursue an over-the-counter designation. Emergent BioSolutions, which makes Narcan, said it is “evaluating the potential for OTC naloxone” but warned of “unintended consequences” from the switch, such as insurers no longer covering the cost and consumers having to pay out-of-pocket. (Experts say products typically are cheaper when sold over the counter.)
Harm Reduction Therapeutics, a nonprofit pharmaceutical company, said it plans to apply for an over-the-counter naloxone nasal spray next year, with the goal that it be on shelves in 2023. CEO Michael Hufford said the company will donate most of its product to harm-reduction groups and raise funds to offset the cost to consumers at retail pharmacies. Currently, the bulk of the company’s funding comes from Purdue Pharma, the maker of OxyContin.
But advocates say the FDA should make the switch itself.
“We have this lifesaving tool available throughout the whole time of this crisis, and the federal government has just been sitting on its hands,” said Leo Beletsky, a professor of law and health sciences at Northeastern University in Boston.
Some pharmaceutical companies in the past have argued that the government doesn’t have the authority to designate a prescription drug as over-the-counter, but others point to a statute that allows a drug’s prescription status to be removed “when such requirements are not necessary for the protection of the public health.” In 1982, the FDA designated an asthma inhaler as an over-the-counter drug without the company’s request, though it later rescinded that status because of widespread criticism that the inhalers would be overused.
Meanwhile, harm-reduction organizations, like the North Carolina Survivors Union in Greensboro, see the demand for naloxone daily. Vincent, who runs the program, said cost and regulatory burdens prevent her from ordering naloxone directly. Instead, she relies on donations from other groups. But she fears the day her group doesn’t have enough.
“I can’t look someone in the eye and tell them I can’t give them medicine that’s going to save their lives,” Vincent said.
A new five-year study will follow more than 500 Vietnamese elders in Northern California, measuring how early life adversity, trauma and other factors correlate with memory and cognition.
Oanh Meyer was a postdoctoral fellow studying the experiences of caregivers for those with dementia in 2012 when her research took a very personal turn.
That year, her mother, a Vietnamese immigrant, began to show signs of dementia and paranoia that seemed to be linked to the trauma she had suffered during the long war in Vietnam, when bombing raids often drove her to hide underground and she lived in fear of Communist troops.
Growing up as a Vietnamese American, Meyer had noticed a reluctance to address mental health issues in her community, an issue she pursued in her studies. She conducted her doctoral research at the University of California-Davis on disparities in mental health care among Asian Americans.
Now an associate adjunct professor at the Alzheimer’s Disease Center at UC Davis Health, Meyer, 45, is leading an investigation into the link between trauma and dementia in the Vietnamese community. With a $7.2 million grant from the National Institute on Aging, the five-year study, which could begin recruiting as early as this month, will follow more than 500 Vietnamese elders in Northern California, measuring how early life adversity, trauma and other factors correlate with memory and cognition.
When Vietnam’s 20-year war ended with the fall of Saigon, now Ho Chi Minh City, in 1975, the United States began evacuating the first of some 1.4 million Vietnamese immigrants. The links between post-traumatic stress disorder and dementia have been studied in other groups, but never in the Vietnamese American population, said Meyer.
Her mother, Anh Le, left the day before the fall of Saigon with her mother and several sisters. Meyer was born in New Jersey soon after, and the family later moved to Oklahoma and then California. Le was 76 when she started experiencing memory loss and paranoia. She was diagnosed with dementia in 2015.
We interviewed Meyer in her Davis home. The interview has been edited for length and clarity.
Q: How did you get interested in the link between trauma and dementia in the Vietnamese population?
In 2013, I did a small, qualitative study where I interviewed several family caregivers who were Vietnamese, and they were taking care of a family member with dementia.
I started hearing all these stories about the trauma that a large percentage of them had faced, or that their family members had faced. At the same time, I remember when my mom was going through her early stages, she was always very paranoid, and that’s a symptom of the dementia. She was specifically paranoid about the Communist military being outside of her house. She would close all the shades and peek out the front door and make sure all the doors were locked.
That made me think: All this trauma that these Vietnamese people have faced throughout their lives, how is that influencing them now? The more I started doing the research, the more I found this link between trauma and PTSD and dementia.
Q: Have there been studies of dementia in Vietnamese Americans?
We don’t know anything about the number of Vietnamese people with dementia. This would be the first look into what this population looks like.
Hopefully, in the future, we can look at demographic shifts and changes and see, has dementia changed over time? We’re hoping to start building some knowledge about this population and the prevalence of cognitive impairment and dementia.
Q: What makes this a good time to study this issue?
A lot of the Vietnamese who came to the U.S. are now becoming older adults. And so those individuals now are at the age where they would likely get dementia if they were going to.
Q: What do you find most interesting about this study?
Their trauma was related to the war and it lasted throughout their early lives. So we can look at the timing of trauma and also tie that to dementia. And then we can look at people who faced that trauma but don’t have any cognitive impairment and look at what factors differentiate these groups of people who all pretty much underwent some type of trauma. There might be some resilience factors.
Q: What are you hoping the impact of this study will be?
If we can find a link between early-life trauma for the Vietnamese population and dementia, we can get a sense of who might be at risk. We can help those individuals and maybe their family caregivers.
I think it can help us understand the health of refugees in general. There’s such a growing population of refugees continuing to come to the U.S. — from Afghanistan, for example. Being able to understand the Vietnamese experience could help us understand other experiences of refugees, and some of the cognitive health issues that might come up for those populations in the future.
Q: Asian Americans face a lot of barriers to accessing mental health services. Is this true of Vietnamese immigrants who need dementia care?
With mental health and with dementia, there is this stigma. I worked with Vietnamese family members who were caregivers and they were like, nobody wants to talk about it. There’s this kind of unspoken rule that you just don’t talk about things that can bring shame to the family.
There’s this model-minority stereotype that suggests that Asian Americans came here, they had nothing, and they worked really hard and now they’re doing really great. But there’s a lot of heterogeneity even within what you think of as Asian American Pacific Islander. So I think what happens is that groups that are not doing well don’t get the support that they need, whether it’s in terms of funding or services.
Q: How have you seen this play out with your mother?
When she started showing the signs and symptoms, we tried to talk to her about it and she just felt like, “Oh, it’s just a normal part of aging. It’s nothing serious.” And I remember talking to her primary care physician about it, too. He was this older Vietnamese man and he didn’t really make a big deal out of it.
Sometimes primary care physicians don’t have training in Alzheimer’s and dementia. So either he did not recognize it or culturally he was trying to save face for her and not cause her to feel distress by giving her a diagnosis.
Q: It must be hard to cope with your mom having experienced trauma and now also having dementia.
It definitely can be hard. But I think I just put on my scientist hat and just try to remember, “Oh, these are the behavioral manifestations of this illness.” It’s very challenging and stressful, and that’s why caregivers need a lot of support. But I think having my research and just trying to remind myself of what’s happening at a neurological or biological level helps, for sure.