Sep 21, 2021

Axios Vitals

Good morning, Vitals readers. Today's newsletter is 918 words, or a 3-minute read.

Another grim milestone: 675,000+ people in the U.S. have died from COVID, topping the death toll of the 1918 flu pandemic to become the deadliest pandemic in American history.

  • With more than 2,000 people on average dying in the U.S. a day, that means about four more people will die before you finish reading today's newsletter.
1 big thing: Health care profits for me, but not for thee

Illustration: Annelise Capossela/Axios

In July, the head of the American Hospital Association blasted UnitedHealth Group for its "jaw-dropping" profits in the second quarter.

But Axios' Bob Herman dug into the financial records of several large, not-for-profit hospital systems, and found three times more profit than what UnitedHealth pulled down.

Reality check: Companies and lobbying groups often paint their business foes as the primary problems with the health care system, but each sector contributes to the system's dysfunction.

By the numbers: UnitedHealth Group, which also increasingly owns doctors and other services, posted a net profit of $4.3 billion on $71.3 billion of revenue in the second quarter.

  • UnitedHealth's operating profit, which excludes taxes and interest, totaled $6 billion.
  • Axios looked at the Q2 financial data for 24 major tax-exempt hospital systems that combined for roughly $72 billion of revenue, on par with UnitedHealth.

Those 24 systems combined for a net profit of $11.9 billion, or nearly three times UnitedHealth's net profit in the quarter.

  • The hospitals' operating profit, which excludes investment income, was $3.6 billion, or about 60% of UnitedHealth's operating profit.
  • Hospitals often point to their operating incomes when referring to slim margins without taking into account the benefits from their investments.
  • The American Hospital Association didn't make anyone available for an interview, but sent a statement that said, "Comparing one commercial insurer to one hospital or health system doesn't give Axios the story you want to publish, so instead you're comparing one insurer to 24 health systems comprised of hundreds of hospitals that provide care 24/7."
  • The analysis looked at a group of systems, instead of just one system, to provide a better average of how large systems were doing. Individually, some hospital systems like Mayo Clinic (31% net margin) and Indiana University Health (28% net margin) are significantly more profitable than UnitedHealth (6% net margin).

The bottom line: Health care has been as profitable as ever during the pandemic. That has been true for both hospitals and health insurers.

2. Biden's high-stakes COVID summit
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Data: Our World in Data; Chart: Kavya Beheraj/Axios

President Biden will convene world leaders Wednesday to push them to do more to end the pandemic, Axios' David Lawler writes.

Why it matters: There's still no functional plan to vaccinate the world, and past summits of this sort have flopped. But the White House hopes this virtual gathering will ultimately help spur action to achieve a 70% global vaccination rate by next year.

State of play: The U.S. is reportedly seeking to buy another 500 million Pfizer doses for donation ahead of the summit, which would bring the total doses pledged by the U.S. to over 1 billion.

  • The 140 million doses the U.S. has donated to date are a drop in the global bucket, but more than other rich countries have contributed.

The timing is awkward. Biden is about to launch a campaign to provide a third dose to millions of Americans when just 6% of people in Africa have had one shot.

  • "When people say we can do both, unfortunately, that's not true, because at the moment we are in a zero-sum game. Vaccines used in one place will have to be necessarily taken away from some other place," Soumya Swaminathan, the WHO's chief scientist, said on a conference call.
3. A shocking number: 9 million
"The COVID-19 pandemic has robbed Americans of 9 million birthdays that would otherwise have been celebrated."
— Hanke Heun-Johnson, a senior quantitative analyst at the USC Schaeffer Center and the author of a study published Monday in Annals of Internal Medicine told Axios Marisa Fernandez.
4. Democrats' case for prioritizing health care
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Reproduced from Hart Research Associates; Chart: Axios Visuals

Health care advocates are making the case that the pieces of Democrats' legislative agenda that lower health care costs and expand coverage are the most popular with voters — and should thus be prioritized, Axios' Caitlin Owens writes.

State of play: The most popular piece of the reconciliation package — at least according to one recent poll — is also, so far, among the most controversial.

  • 41% of respondents in a recent Hart Research poll said that allowing Medicare to negotiate prescription drug prices is one of their top three priorities out of the major provisions included in the Democrats' reconciliation package — second only to expanding Medicare to include dental, hearing and vision benefits.

Go deeper: Democrats' competing health care priorities

5. Average COVID hospitalization costs
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Data: FAIR Health; Chart: Will Chase/Axios

The median billed charge for a complex COVID hospitalization tops $208,000, according to data provided first to Axios by FAIR Health.

  • The median estimated amount allowed — or the negotiated in-network fee with providers — for a complex COVID-19 hospitalization in the U.S. is about $71,000.

What they're saying: "A complex COVID-19 hospitalization incurs additional costs, such as a stay in the ICU or a ventilator, whereas a general COVID-19 hospitalization does not include those items. That cost difference might be overlooked if the costs were not broken out," Robin Gelburd, president of FAIR Health, told Axios.

What we're watching: The Washington Post reports more insurers restored deductibles and co-pays for COVID patients.

6. What we're reading

Illustration: Aïda Amer/Axios

  • Dozens of the world's biggest brands, including Nike, Amazon and Ted Baker, have been advertising on websites spreading COVID misinformation. (The Bureau of Investigative Journalism)
  • Six rules that will define our second pandemic winter. (The Atlantic)
  • The White House announced a slew of actions Monday to protect American workers from extreme heat. (Axios)
7. Emoji du jour

Photo: Apple

The launch of Apple's newest operating system iOS 15 on Monday came with several health-related features, including some new "memoji" options with cochlear implants, oxygen tubes and medical helmets.

  • Other features included in the update include options to securely share health data with loved ones or physicians, as well as a "walking steadiness" measurement tool.