The Health Industry Distributors Association (HIDA) has been closely tracking the effect of COVID-19 in key health industry market segments. HIDA’s 2020 Market Reports take a look at how the pandemic has affected the landscapes of physician offices, hospitals and health systems, and home care.
Physician office
The physician and clinical services market was valued at $750 billion in 2019, with more than 1 million active physicians offering patient care throughout the United States. But COVID-19 has driven large volume and revenue declines. Nearly 90% of medical groups reported revenue declines of 26% or more during the first several months of the pandemic. Through the end of 2020, in-person visits were expected to remain at least 30% below baseline. Telehealth took off in 2020, a bright spot for many patients and caregivers. Physicians and health officials saw 50 to 175 times the number of patients via telehealth than pre-pandemic. Some experts estimate that a previously $3 billion telehealth industry could blossom into a $250 billion industry.
Hospitals and health systems
U.S. expenditures on hospital services are expected to reach $1.32 trillion in 2020 and increase to $1.75 trillion by 2025. In an industry already operating with -9.3% Medicare margins, hospitals and health systems are expected to lose at least $323 billion in 2020 due to COVID-19. During the first several months of the pandemic, both operating room and emergency department volumes at short-term acute care hospitals decreased 35% and 42%, respectively. Additionally, 43% of hospital executives expressed concern in 2020 of continuing cost and shortages of medical supplies.
Home care
The home-based medical market is expanding. The segment, which includes hospice, home health, home infusion, and durable medical equipment, is valued at more than $211 billion and is projected to grow 35% to about $286 billion by 2025. COVID-19 has resulted in reduced demand for home health agency services. Three months into the pandemic, 90% of agencies reported a decline in admissions. But there have been bright spots; medical researchers with the Visiting Nurse Service of New York have been studying how home health can benefit COVID patients when new infections are high and hospital beds are in short supply. Upon being admitted to home health, most patients had multiple comorbidities including hypertension, diabetes, and heart disease. After home health services were delivered, 88% of the patients studied were discharged without any adverse health events, such as re-hospitalization.