Implications of Covid-19 on Cost of Healthcare
By Manivannan S - Healthcare SME
Covid-19 has changed and challenged the way hospitals provide services to patients. These changes have an impact on cost of services to both Covid-19 and regular patients during the pandemic and would have longer-term implications even after the Covid-19 pandemic is brought under control.
During this period of lock down and recovery, hospitals and other healthcare centres are faced with falling revenues, additional costs for Covid-19 treatment protocol, retaining a trained and motivated team and other regular fixed overheads which have to be paid regardless of falling revenues.
Post Covid also, healthcare organisations (HCO) are looking at a new normal. There will be additional costs of clinical protocols till technology for immediate diagnosis of virus and a vaccine are discovered & stabilised. These additional costs would be applicable to all patients. Thus, HCOs are faced with pressure on reimbursements and the longer time taken to reach optimum capacity.
In this scenario, it becomes imperative for the hospitals to take steps to:
Understand their present cost structure and capacity utilisation
Identify weak and sweet spots
Plan how to control costs during the run-up to achieving the new normal
Ensure every unit and cost per unit of resource gives maximum benefits
Use technology to facilitate a paradigm shift in business model
Finally protect their market-share and margin
In the article, we will take a quick look at the existing scenario and understand the cost implications, a strategy to mitigate the losses and the way forward.