Goldman: COVID Surge Could Reduce 2022 Demand for Elective Medical Procedures

With the pandemic ongoing, Goldman Sachs analysts are saying that the recovery in hospital procedure volumes and rebound in MedTech procedures could be delayed, a report says.

There could be at least one more COVID-19 wave following Omicron, the analysis says.

And despite the lack of any coherent timeline for “normalizing” things, analysts say there’s possibility that the disease will reach endemic status, which could give a boost to some commercial firms and those which work with hospitals and procedures.

In that case, analysts have said a future resurgence could hurt procedure volumes and make nursing shortages worse.

That could also lead to a slowdown in elective procedures, which would come with a limiting of surgery volumes.

“Expect relative underperformance to continue until at least the Spring, when a resetting of numbers and reduced hospital constraints could foster a recovery,” the analysts Amit Hazan and the team wrote. They predict that there could be more visibility by mid-2022 when “vaccines, natural immunity, antivirals and better overall management experience with COVID should increase the likelihood of recovery” for this healthcare sector.

Goldman Sachs has added the firm Intuitive Surgical to its conviction list because that company says there might be a possible launch of its multiport system in the first quarter.

Overall, Goldman describes a favorable backdrop in the managed care space, in spite of the limits to procedure volumes and labor constraints and the shift to low-cost settings. The companies have been conservatively priced anyway, which could predict the return of deferred care and COVID costs.

Goldman Sachs has said the cutting of the child tax credits in the U.S. could end up hurting the country’s economic recovery, according to economist Jan Hatzius.

Read on: Goldman Sachs: Loss of Child Tax Credit Could Upend Economic Recovery

The report says the situation is even more likely because of the hold-ups to President Joe Biden’s Build Back Better (BBB) plan, held up by objections from senators like Joe Manchin.

The Goldman Sachs note says there was already a “close call” with the BBB plan, and that Manchin’s comment forecasted a smaller, more restricted set of financial proposals.