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Good morning. A few important housekeeping notes before you read the Brew and check on your garden.
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Today we’re resuming our New Normal series, which explores COVID-19’s long-term impact on different industries. Last week, we asked you what you wanted to read about. The most popular response was healthcare. So today we wrote about healthcare.
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On Sunday, you will be receiving Light Roast. Typically, this newsletter is reserved for readers with 3+ referrals, but we wanted to give everyone a taste in case you want Light Roast in your inbox permanently.
Hope you all have a great weekend, and see you tomorrow morning.
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NASDAQ
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9,588.81
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+ 1.01%
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S&P
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3,041.31
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+ 1.31%
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DJIA
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25,605.54
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+ 1.90%
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GOLD
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1,737.30
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- 0.14%
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10-YR
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0.703%
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+ 3.00 bps
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OIL
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36.45
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+ 0.30%
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*As of market close
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Markets: Stocks rebounded just a bit following the worst trading day in months. Investors tried to swallow a new report from the Fed, which warned “the path ahead is extraordinarily uncertain” for the U.S. economy.
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World: One thing is certain—the UK's economy tanked in April. By shrinking more than 20%, the economy essentially wiped out all growth from 2002.
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Francis Scialabba
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The coronavirus pandemic has resulted in never-before-seen experiments around remote work, the metaverse, and finally embracing leggings as real pants. It’s also created a budding star in healthcare: telemedicine.
- The U.S. government defines telemedicine as the use of information and communication technologies to provide clinical healthcare services. “Telehealth” implies both clinical and non-clinical services, though it's often used interchangeably with telemedicine.
COVID-19 could be the tipping point. Virtual doctor visits jumped from ~12,000/week to more than 1 million/week during the pandemic. “Physicians have now basically crossed the rubicon,” NY Presbyterian CEO Steven Corwin told Fortune.
So what's in the way?
While it's not new, telemedicine hasn’t been a top priority for providers or insurers. Virtual visits can be less profitable than in-person services, especially for rural hospitals. Regulatory barriers have also created uncertainty around telemedicine’s future.
For patients, Medicare, Medicaid, or insurance don’t always cover the cost of virtual care. In rural areas (where telehealth is especially helpful in plugging healthcare gaps), many people lack tech or broadband access.
The COVID-19 pilot
When the pandemic began, federal officials relaxed telemedicine rules. They waived certain Medicare requirements and allowed doctors to practice across state lines and virtually prescribe more medications.
- Many states also expanded Medicaid telehealth coverage and relaxed licensing restrictions. Some required that private insurance plans cover and reimburse telemedicine as much as in-person visits.
Centers for Medicare and Medicaid Services Administrator Seema Verma is pleased with early results and wants the U.S. to continue expanding telemedicine access. But there are still some wrinkles to iron out, including...
- Whether Medicare/Medicaid should pay out the same for virtual appointments
- Expanding eligible services to include emergency care, physical therapy, and mental health
- Bringing virtual care to home consults, hospices, and nursing homes
- Easing licensing rules so telemedicine can cross state lines
Looking ahead...Verma said health officials are searching for ways to boost telemedicine. However, only Congress can permanently expand it to more patients and healthcare plans.
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Noam Galai/Getty Images
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The coronavirus pandemic has made painfully clear all the ways the U.S. healthcare system hasn’t lived up to Miranda Bailey’s expectations.
No. 1: Unequal outcomes
Preliminary data shows black Americans were disproportionally harmed in this crisis. For example, black people account for 14% of Illinois’s population, but more than 40% of its confirmed coronavirus deaths in mid-April.
What happened? Inequalities that existed pre-pandemic (less flexible working arrangements, greater likelihood of pre-existing conditions, less access to medical care) amplified the virus’s impact on vulnerable populations.
No. 2: Employer-based healthcare
With businesses caught between a tanking economy and a workforce that needs reliable healthcare, some policy wonks are proposing major changes.
Some conservatives advocate for health reimbursement arrangements (HRAs), where employers pay workers for healthcare costs directly rather than offering insurance through a company-based plan. Progressives say the crisis shows it’s time for universal healthcare.
No. 3: Doctor burnout and misaligned incentives
“For years the U.S. healthcare system has strained doctors and nurses with demands that place financial interests above patient care, making the practice of medicine unbearable,” a Rhode Island emergency and critical care doctor wrote for STAT.
Bottom line: Medical experts think that COVID-19, by exposing the numerous flaws in the U.S.' current healthcare system, could accelerate significant policy shifts in the industry.
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Getty Images
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As of last month, one-third of COVID-19 deaths in the U.S. were residents or workers at nursing homes and other long-term care facilities, according to the NYT.
How did it happen?
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Lack of protection: One-fifth of U.S. nursing homes reported a shortage of personal protective equipment in late May, per a Kaiser Health News analysis.
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Lack of staff: A Reuters analysis of federal data found that about a quarter of nursing homes reported direct-care staffing shortages in the second half of May.
The problem isn’t confined to the U.S. In Canada, nursing homes accounted for 81% of COVID-19 deaths as of May 18.
What might change
The model underpinning the long-term care industry. Nursing homes are valuable because they consolidate care for the elderly.
- But with consolidation acting as coronavirus kindling, the nursing home as we know it might never return.
- We'll likely see a huge shift in demand toward home-care. By 2026, the U.S. home-care industry will need to fill 4.2 million jobs, per PHI research. And that forecast was made before the pandemic.
Bottom line: Grace-Marie Turner, president of the free-market think tank Galen Institute, thinks the shift is fueled by more than coronavirus fears. “People want their own independent life,” she told STAT.
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Summertime is upon us, and hot days call for even hotter sneakers. That’s why the Brew Crew is gearing up for summer with CARIUMA’s sustainable sneaks.
This summer treat for your feet is the most sustainable, comfortable, and stylish thing that has ever happened to traditional footwear. CARIUMA sneakers bring summer wherever you are with a variety of bright colors that are just as good-looking as they are consciously-made.
With CARIUMAs, your feet will be hotter than the summer sun and cooler than an ice cold drink by the pool. They’ll be fresher than the smell of fresh-cut grass. Ready for a vacation from this metaphor yet?
Now’s the time to get these sneaks before they’re gone. Brew readers can get their feet summer-ready with an exclusive 15% off for a limited time.
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Giphy
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According to health psychologist Elke Van Hoof, worldwide lockdowns brought on by COVID-19 have set the stage for "arguably the largest psychological experiment ever conducted."
- As they cope with isolation, an economic recession, and stress about the virus itself, 45% of U.S. adults told the Kaiser Family Foundation their mental health got worse.
The hypothesis: When this is all over, researchers will know how well human brains cope with a long-lasting traumatic event—without the benefit of frequent human contact, established routines, and in-person mental health care.
It doesn’t help that when it comes to government support...
Mental health’s getting the short end of the stethoscope
The $425 million set aside in the CARES Act for the Substance Abuse and Mental Health Services Administration is less than a quarter of 1% of the $185 billion invested in healthcare providers altogether.
- Nearly two-thirds of community behavioral health organizations say they’ll shut down in three months or less.
Meanwhile...teletherapy services are booming. Talkspace and BetterHelp reported a surge in new users this year, and meditation app Headspace secured $47.7 million in new funding. We don’t know yet if virtual appointments and aids can replace in-person care, but experts are optimistic.
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World Economic Forum
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In a 2015 Ted Talk, Bill Gates declared, “If anything kills over 10 million people in the next few decades, it’s most likely to be a highly infectious virus.”
He probably should have said “viruses.” As humans crisscross the globe with increasing frequency, dive deeper into natural ecosystems, and contribute to climate change, medical experts warn it’s basically inevitable we’ll experience more viral outbreaks.
- “You asked what keeps me up at night,” CDC Director Robert Redfield told a House committee. “I know it’s a pandemic flu.”
So what have we learned from COVID-19?
That we need to do a lot better next time around. Here are a few proposed solutions from medical experts...
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More funding: Redfield told Congress that his agency didn’t have the money to fulfill the “core capabilities of public health.” The UN says we need to spend $11 billion more to fight global pandemics.
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Reforming the WHO: Global cooperation is critical to fighting a pandemic, but critics argue the World Health Organization has serious flaws in its design.
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Strengthening the medical supply chain to ensure critical drugs are available when needed.
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More surveillance: As David Ecker writes in Scientific American, “The best way to prevent pandemics is to apply the same principles as we use to prevent catastrophic forest fires: survey aggressively for smaller brush fires and stomp them out immediately.”
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The CDC: The U.S. may have to institute severe lockdown restrictions again if cases rise dramatically. It stressed Americans should wear masks, stay six feet apart, and wash hands.
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Hertz shares soared 37% after the bankrupt company unveiled a truly crazy plan to sell up to $1 billion in stock. A court gave it the green light.
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Starbucks will now let employees wear Black Lives Matter apparel, reversing an earlier stance.
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Fox News host Tucker Carlson is losing big-name advertisers following comments about BLM protests, including Disney and Papa John’s.
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Matt James is the first black male lead cast on The Bachelor.
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Before you head to the beach, check out some of our favorite Morning Brew reads recently.
Social media: 20 Finance Twitter accounts to follow.
Morning Brew Originals: We wrote about the ultra-confusing policies around refunds during the pandemic and the future of the face mask as a consumer product.
Crossword: Try out our latest puzzle before Monday’s hits.
Recipes: Our Memorial Day cooking guide is useful for the entire summer. Check out our tips for grilled pizza and the vaunted “dirty horchata.”
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While all these video game headlines appear to be a glitch in the Matrix, only one is actually fake. Can you spot it?
- "Man wearing VR headset exits apartment, walks into CVS before being confronted by store clerk"
- "New Sims 4 patch adds ladders but also a bug where Sims pee fire"
- "A government in Japan limited video game time. This boy is fighting back."
- "Fortnite glitch lets players build customized exploding drone"
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SATURDAY HEADLINES ANSWER
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No one was roaming the streets with a VR headset.
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Quarantine newsletter → 
Retail newsletter → 
Business podcast →