Read: How the pandemic will end
Consolidation has long been a feature of American economic life, and corporate mergers and acquisitions are routinely justified as saving money and creating other efficiencies. Unsurprisingly, mergers have reshaped even nonprofit health care, as formerly independent hospitals have joined into larger systems. Writing in The New York Times in February 2019, the health-care economist Austin Frakt disputed hospital chains’ claims that consolidation had lowered costs and improved health outcomes.
As costs of health care have escalated, doing more with less has become a universal goal. Over the past two decades, the state of New York pressed for the elimination of 20,000 hospital beds. The pursuit of efficiency in the state’s health system was a bipartisan effort, originating in a 2006 report from a commission convened by Republican Governor George Pataki and continued by his Democratic successors, including Andrew Cuomo. The commission urged an occupancy rate of 85 percent, up from an allegedly wasteful 65 percent in 2004. Many of the hospitals closed during this wave of consolidation served the most economically troubled neighborhoods of New York City—neighborhoods that, in March and April, were disproportionately struck by the pandemic. Once COVID-19 threatened to overwhelm the New York hospital system, Cuomo was pleading with Washington, D.C., for additional beds.
Fortunately, because of public compliance with social-distancing measures, the need for hospital beds has proved less dire than authorities feared. But New York’s experience illustrates the difficulty of adding useful hospital space from scratch at moments of crisis; the Navy hospital ship USNS Comfort, which came to New York’s assistance, was ill-equipped for treating coronavirus cases and was of little help in absorbing patients with other ailments. The ship is now slated to depart.
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In theory, efforts to make American health systems more efficient could have made them nimbler. In New York, the expansion of preventive and primary care was supposed to accompany the closure of hospitals. But that did not occur in many poor areas. Meanwhile, cutbacks in hospitalization nationwide have simply pushed unwell people into other forms of care. “Nursing home facilities,” The New York Times reported earlier this month, “have borne the brunt of a structural shift: Hospitals, seeking to keep costs down, send more vulnerable patients into a growing industry of nursing homes.” About a fifth of COVID-19 fatalities in the United States, the Times noted, have been linked to nursing-home and long-term care facilities.
The pandemic also exposed weaknesses not just in the extension of human life but in the provision of food that sustains it—specifically in the giant slaughterhouses and meat-packing plants of rural America. According to a 2000 report from the U.S. Department of Agriculture, new technology in the previous 20 years had revolutionized meat processing, increasing production in fewer plants through economies of scale. This evolution, which benefited shareholders far more than workers, produced today’s highly consolidated industry. While the early-20th-century horrors depicted in Upton Sinclair’s novel The Jungle are gone, meat cutting remains one of the most hazardous jobs, with workers often crowded together. Viral infections can spread at small plants, but at larger ones they can strike far more people more quickly. While the risk to consumers may be relatively small, a single asymptomatic infected worker could transmit the virus from the community to hundreds of fellow workers, or vice versa. At a Smithfield Foods plant in Sioux Falls, South Dakota, more than 700 workers have tested positive for the coronavirus. That plant alone handles up to 5 percent of the entire nation’s pork production, and its shutdown forced the closure of other Smithfield plants that use raw materials from Sioux Falls. The closure of a single plant can devastate the meat supply and agriculture of an entire region. The Tyson Foods plant in Pasco, Washington, that closed on Thursday for COVID-19 testing processes 2,300 head of cattle a day, reportedly supplying enough beef to feed 4 million people. The Trump administration announced yesterday it would designate meat plants as essential infrastructure and require them to remain open. This short-term move will not reverse the trends that brought about the current problem.