Thread by @Barton_options

The most likely (not the best) COVID19 health-care strategy in the US for March 2020 right now:

No testing, no treatment (go home and tough it out), no bankruptcy.. just death from some unknown pneumonia

reasons, implications, potential improvement below:

(1/x)

No doubt testing/diagnoses are super important. Without it, we are flying blind.

1. doctors/patients don't know whether COVID19 treatment should be applied.
2. policy makers don't know whether school closures/traffic restrictions should be relaxed or enhanced

(2/x no testing)

Testing is hard!

Massive (40k-100k test/day) rtPCR testing capacity is needed:
1. because of high false negative rate, each patient needs to be tested 6-10 times to ascertain 100% recovery.
2. US population is high and COVID19 is very contagious

(3/x no testing)

Testing is also hard, because rtPCR turns positive very late, and chest CT is more sensitive in identifying suspected cases.

China has low-cost chest CT capacity. US has none.

(4/x no testing)

rtPCR capacity has a chance to ramp up to 40k-100k test/day if commercial kits are used. quality control is unknown. so more false negatives are likely.

chest CT capacity is impossible to ramp up in 1 month (capital, personnel issues)

(5/x no testing)

I will finish this thread after the market close. it sounds depressing, but I still think >99.5% people below 65 in the US should be able to survive.

Cost of testing is another big hurdle. Assuming we reach 67k test/day (South Korea level) and cut the cost from $3000 to $1000, that's still $67Mn a day. $2Bn a month.

Who is going to pay for that?

Why can't US have $160 tests like Korea?

(6/x no testing)

Now, assuming testing bottleneck is completely solved, not much treatment is deliverable in the US. Several reasons.

1. Healthcare workers severely underprotected:
PPE availability issue
workplace culture issue
PCP/state health official complacency

(7/x no treatment)

As a result, significant shares of doctors/nurses will be too sick to work and quarantined due to their COVID19 carrier status.

No doctors, no healthcare available (no matter how good your insurance is)

Nightmare for severe patients
(8/x no treatment)

2. The most promising US treatment option, Remdesivir, requires IV infusion for 10 days. Our system is simply not possible to deliver that in out-patient care (even if all nurses remain healthy)

(9/x no treatment)

3. The most promising Chinese treatment option, chloroquine (oral tablet), requires very careful dosing and timing. CDC and physicians show no interest in considering that risky option for mild cases so far.

(10/x no treatment)

4. For severe and critical cases, our private hospital system simply cannot scale up like China. The picture below is how we handled a mild case evacuated from the cruise ship. how much resource do we have to handle 1000 severe cases?

(10/x no treatment)

5. Because how our healthcare system will be jammed by COVID19 patients, NO TREATMENT extends to many other diseases. Expect no dentistry, no surgery, no dialysis etc. for a few months during the acute phase of the outbreak.
(That happened in Wuhan)
(10/x no treatment)

So US will lose its healthcare system for a few months.

Are we all going to die? <0.01% chance for my followers I hope.

COVID19 is recoverable at home, if you are prepared and know how. I hope my tweets set up the right expectation for you on what's to come
(11/x no treatment)

so that you can take rational actions.

What I would do, if I were sick (YMMV, not medical advice)

Rest well
Eat well (esp. protein)
Lower my stress (close all positions)
light exercise (7000 steps) if no fever
Avoid hospitals until high fever or SpO2<94%

(12/x no treatment)

For insurance companies, whatever remaining medical resources will be paid by them.

Probably challenging for them to survive without a bailout.

Testing alone could bankrupt them at current prices.
(13/x no bankruptcy)

For households, the situation is different.

For senior households, no-testing-no-treatment has little monetary cost (terrible human life cost for sure), and thus no bankruptcy.

(14/x no bankruptcy)

For working-age families, those who live paycheck-to-paycheck and have kids are most vulnerable, since they

cannot afford to take sick leave
have to lose hours to babysit kids.
have high-deductible insurance
tend to delay treatment and spread virus or be infected by spreaders.

so these households may still suffer from bankruptcy, unless helicopter money is given to them.

Without government action, expect a big demand shock from these households.
(16/x no bankruptcy)

IMO, US has passed the point of no return on COVID19 in mid Feb.

There will be an acute (4-10 week) crisis of losing health-care for a few months, until doctors recover, fever clinics are set up and PPE is re-supplied.

(17/x Implications)

There will be a demand shock (esp. in service sector) caused by social distancing and bankruptcy, which will severely reduce earnings and print 30-ish PMI for 1-2 quarters.

(18/x Implications)

Current WH and congress are likely to over-deliver in monetary stimulus, and under-deliver in fiscal stimulus:

helicopter money for free-testing
helicopter money for households.

asset price crash and recovery will be highly sector-dependent.
(18/x Implications)

Immediate actions needed:
1. protect healthcare workers.
setup fever clinics (avoid cross-infection)
educate physicians/nurses on protection/treatment of COVID19

2. helicopter money for testing and for working-age households (enabling social distancing)
(19/x priority measures)

3. not overdoing QE/rate-cuts. killing DXY will kill US equity fast, especially with continued incompetency in mitigating COVID19.

(20/x priority measures)

That's the end of my rant. @threadreaderapp unroll please.