Orthopaedic surgeons predict return to somewhat normal volumes in 6 months

Dive Brief:

  • Despite pent up demand following the cancellation of elective procedures, orthopaedic surgeons will face a slow recovery in ramping their services back up, according to a new Jefferies survey.
  • The 40 high-volume orthopaedic surgeons who responded to the survey said their current weekly volumes are down 90% compared to before the onset of the COVID-19 pandemic in the United States. Within the next month, they hope volumes will be down 33% compared to operations before the virus. Surgeons say that within three months volumes could be down only about 5% to 7%.
  • Patients are expected to return for delayed procedures with minimal hesitation, according to the responses. In describing how patients felt rescheduling hip and knee replacements, nearly 70% said anywhere from “neutral/normal” to “very receptive.” No respondents marked that patients were “very unreceptive.”

Dive Insight:

Hip and knee replacements are lucrative procedures for surgeons and their clinics and hospitals. Widespread cancellations over the past few months have battered those systems financially, and ramping them back up is key to staying afloat.

Most of the surgeons who responded to the Jefferies survey said they felt optimistic about the recovery of their business, but brought up practical considerations, including surgical capacity and patient willingness. The uncertain trajectory of the U.S. economy amid the COVID-19 pandemic is another potent fear that could especially hamper efforts. 

During the last week of April, orthopaedic surgeons saw 87% to 95% declines in their volumes of hip and knee arthroplasty procedures, compared to business prior to COVID-19. 

While those procedures are expected to steadily ramp up over the next six months, more will be performed outside of hospitals — a trend accelerated by the pandemic, the survey found. 

Currently 12% of orthopaedic procedures are performed in ambulatory surgery centers, a number expected to rise to 20% in six months.

That will only add to the intense pressure on hospitals that are trying to navigate through the effects of this pandemic as volumes have plunged. To help providers survive, the federal government has provided billions through grants and accelerated Medicare payments to hospitals and providers, insurers have also sped up payments to keep them afloat.  

Health systems across the country have laid off and furloughed workers as patients stay home and elective procedures halted.

Outpatient visits overall have plunged in recent weeks, according to a recent Commonwealth Fund study.

But the shift to ASCs remains a challenge for orthopaedic manufacturers, especially given concerns that pricing for implants is lower in the ambulatory surgery setting.

Much like hospitals, medtech manufacturers are seeing financial declines given the sudden halt in procedures that use their devices. Many reported dismal first quarter earnings and withdrew fiscal year 2020 revenue and earnings guidance. 

Jefferies analysts said there are reasons to be positive that volumes in medtech will resume. However, there is also cause for caution and the situation remains fluid.

Analysts said street estimates for some medtech companies that expect a very steep recovery may be too optimistic. 

“We could be proven wrong, but early revisions post Q1 results seem to be assuming a much more optimistic recovery than the balance of plusses and minuses — and our survey — might suggest,” Jefferies analysts said in the report.

Some specialty groups have put forward plans for restarting elective procedures. The American College of Cardiology, for example, contributed to guidance earlier this month for safely restarting invasive procedures like transcatheter aortic value replacement as well as diagnostic tests.