Regional Report: The Business Side of Healthcare
A GPEC Virtual Series
The Greater Phoenix Economic Council (GPEC) recently hosted a fireside chat with Greater Phoenix business and hospital leaders to discuss ‘The Business Side of Healthcare,’ and the intersection and impacts of COVID-19 on the economy and healthcare ecosystem.
Moderated by Eric Sperling, managing director of the Social Television Network, the webinar kicked off with remarks from Patrick Holcomb, founding partner of Ironwood Ventures; and David Kotter, founder and CEO of Integrity Capital and then the fireside chat with Chris Camacho, president and CEO at the Greater Phoenix Economic Council (GPEC) and Dr. Richard Gray, CEO of Mayo Clinic in Arizona began.
Chris Camacho painted a stark economic reality to open the conversation.
“In the current recessionary period, we’ve seen job losses in the United States that are now reaching 21 million,” he says. “What’s been sharply different about this one [recession] as opposed to some of the previous recessionary times was the immediacy and the significance of the jobs loss.”
Camacho noted Arizona currently has a 12.6 percent unemployment rate and the duration of the economic recovery is currently unknown. Camacho has been steadfast in his belief that ‘Greater Phoenix’s economic viability is contingent on the health and well-being of the workforce at large,’ and had a simple message for attendees on the webinar.
“I would encourage anyone that has a mask to wear it out in public,” he says.
Despite the virus surging, retail sales numbers rose to 17.7 percent from April to May 2020.
“Well above what the economists were projecting at roughly an eight percent retail sales tax growth position,” says Camacho.
Despite those positive gains, Camacho says, “the demand curve we’re seeing is still roughly at best 50 percent for restaurants, 50 percent for retail, which is slowly coming back.”
Greater Phoenix has seen notable wins recently with Zoom, TSMC and Smead Capital relocating or expanding to the region. While there is positive momentum on the pipeline front, Camacho says, “We’re having clients not visit the market for the next two weeks because we’re being designated a hot spot.”
Camacho is still confident in the long-term recovery and success of Greater Phoenix, but says, “We should be realistic. Best case, this is going to be maybe a V-shape, but probably more like an elongated U-shape recovery.”
That recovery is heavily dependent on stopping the spread of the virus.
“We still haven’t got to the point yet where we are controlling the outbreak of the virus, and so we want to do everything as Arizonans to practice not only good hygiene with washing hands, but also making sure we’re social distancing,” he says. “That is one thing that could curb this enthusiasm, or this momentum is if we have a widespread outbreak that impacts our hospital systems.”
Dr. Richard Gray, CEO of Mayo Clinic in Arizona, agreed.
“There’s no question that we’ve seen an uptick in cases, and you know, COVID-19 has had some serious effects,” he says. “I think we start on the individual level, individual lives.”
Dr. Gray noted that Arizona was affected less than other areas of the country when the pandemic began, and Arizona was able to flatten the curve in March, April and early-May. Even with the success, healthcare experts used that time to prepare and innovate knowing the COVID-19 virus wasn’t going to go away.
“It was buying us time to prepare and innovate, and I think a lot of people have done that,” he says. “Mayo Clinic and other hospitals have had to innovate in how to care safely for our patients and staff through all of this, but too many people, I think, have approached this as, okay, we waited this out, now we go back to normal, and that’s where we’re running into problems.”
Innovation is at the core of Greater Phoenix’s spirit. Patrick Holcomb, founding partner of Ironwood Ventures, discussed how businesses can ‘(re)LAUNCH’ during a crisis and shared a blueprint composed of six core pillars, but emphasized messaging alongside people are two core tenants of managing a business through a crisis and ultimately emerging.
“Keeping your external message during normal times is generally fine, but redefining your message becomes really ever so important during a crisis,” he says. “Customers need to understand the value that you bring more than ever, and your messaging really will shape that connection. You have to think in terms of getting back to the origins of your brand and validating those words that really resonate today.”
David Kotter, founder and CEO of Integrity Capital, a full service management consulting firm with a focus on small businesses, developed the ‘(re)LAUNCH’ blueprint back in March and shared, “a couple practical examples of how that blueprint framework can and should be applied for all business whether you’re big or small,” he says.
Kotter highlighted how organizations have bridged medical and business solutions, which was a main focus of the discussion. Kotter took viewers through case studies, including one highlighting Abilities Neurological Rehabilitation (Abilities), which only had brick and mortar offerings pre-COVID. With the help of Kotter and his team, in mid-March, Abilities pivoted their offering to virtual therapy, which included an updated website, buildout of a new line of business, educating and certifying all staff who were comfortable performing virtual therapy and communicating to all clients to keep them apprised of what the company was doing and why.
The innovative pivot worked.
“We were forced to close our doors back on March 20,” says Kotter. “In April, we retained 60 percent of pre-pandemic revenue with the doors closed and added 30 new families. May finished with 65 percent of pre-pandemic revenue and added 20 new families. We just hired our first dedicated staff member specifically for virtual and we’ll be adding more along the way.”
With the reopening of the economy, a lot of businesses are doing better, but Dr. Gray was direct in his counsel that businesses need to follow Centers for Disease (CDC) procedures.
“I think a lot of people are trying their best and doing very well. It’s not really that hard to know what to do,” he says. “The CDC guidelines are very good, they’re very clear, we just need to read them and actually do them.”
One example: gloves.
“I see many restaurants and other businesses where the staff are wearing gloves,” Gray says. “That intuitively seems to make sense, except the gloves pick up viruses as you go around. Unless you’re changing gloves constantly, gloves are counterproductive even though you think you’re helping. It’s better to use your hands and wash them often.”
Dr. Gray expanded.
“Do things in your business that will give consumers confidence that they can be safe in your establishment,” he says. “Business leaders owe it to their staff, and they owe it to their customers to make sure that both are staying safe as much as we want to have business revived.”
But, it’s not just business owners. Consumers have an obligation as well.
“I think what we’ve unfortunately seen is that a lot of those consumers don’t appear to have a level of concern that they should,” says Gray.
Health and safety of the community is the number one priority, but there is a continued economic reality as the virus persists and spreads. Chris Camacho talked about GPEC’s work to support small businesses through this unprecedented time and collaborations with the Black Chamber of Arizona and the Arizona Hispanic Chamber of Commerce to provide support and deliver value to minority-owned businesses.
“I can’t stress that enough – spend local, buy local, patronize those businesses, or else they’re not going to come out on the other side,” he says. “I don’t know any other way to prop up, save, support those kinds of enterprises but for spending money at their establishments.”
Of the more than 114,000 small business with employees throughout Arizona, GPEC projects 11 percent of those are still at risk.
“Even as we’ve seen retail sales curve in a positive direction, that’s roughly leaving 12,000, 14,000 business that could be under duress,” says Camacho. “They’re going to take with them tens-of-thousands of employees and indirect spend. This is all woven into a broader economic strategy. Adjustment wise, we’ve been on it with a lot of our peer organizations to help drive outcomes.”
There is an undeniable spirit about Greater Phoenix, a spirit rooted in strength, collaboration and resilience.
“I’m seeing businesses leaning on each other, with each other, to get through this together,” says Camacho.
Dr. Gray followed up Camacho’s sentiments around the community supporting one another, but with a healthcare emphasis around the practice of “masking.”
“Masking is not about protecting yourself, it’s about making an investment in protecting the people around you,” he says. “I wear a mask to protect others, you wear a mask to protect me, and that’s the spirit that Chris is talking about in our community.”