michael barbaro

From The New York Times, I’m Michael Barbaro. This is “The Daily.” Today: States and cities across the U.S. are reporting dangerous shortages of vital supplies needed to contain the pandemic. Sarah Kliff on what’s behind those shortages. It’s Tuesday, March 31.

archived recording (bill de blasio) Well, it’s Friday, what feels like has been an endless week. I know so many New Yorkers have really felt this week. It’s been very, very difficult.

sarah kliff

Last Friday in New York City, Mayor Bill de Blasio gave a news conference, and he essentially came out and said that the city is running out of medical supplies.

archived recording (bill de blasio) We’re getting through this week. It’s tough. We have what we need for next week, but it will definitely be a very hard week. But after next Sunday, April 5 is when I get very, very worried about everything we’re going to need. The people power we’re going to need, the equipment, the supplies, obviously the ventilators.

sarah kliff

That they only have about a week left of the things they really need.

michael barbaro

Mm-hm.

archived recording (bill de blasio) But I want to put down that marker right now, and I’ve put down that marker to the White House, that that is a decisive moment for the city of New York. We need to make sure that we can get to that day ready to face the week after that and the week after that as well. And right now, we’re not there.

sarah kliff

And this is what we’re hearing from mayors, from governors all across the country.

archived recording (john bel edwards) Everybody’s looking for ventilators. Everybody’s looking for P.P.E. Everybody’s looking for medical staff, and everybody’s looking for beds. And so that’s what makes this particularly hard.

sarah kliff

There aren’t enough supplies to treat the coronavirus outbreak.

archived recording (gretchen whitmer) There’s not enough ventilators. We need thousands of ventilators in Michigan. There is not enough N95 masks. We’ve got nurses who are wearing the same mask from the minute they show up for their long shift to the end of that shift.

sarah kliff

There aren’t enough masks. There aren’t enough hospital beds. There aren’t enough ventilators. The list is long, and hospitals are getting worried about running out.

michael barbaro

So how can that be? How is it that the U.S. is running so low, and in many cases, actually running out of so many essential components of a response to this pandemic?

sarah kliff

Well, for each component, there’s actually a unique backstory. There’s a clear reason why we don’t have enough and why it is hard to get more.

michael barbaro

Well, let’s go through each one of the three that you mentioned, starting with what would seem to me like the easiest problem to solve, which is masks. So what explains the shortage there?

sarah kliff

The masks were one of the first things to come into shortage. It was one of the first places where we started realizing we might not have enough supplies for our health care workers.

michael barbaro

Mm-hm.

sarah kliff

And to understand the shortage of masks, you probably want to go back 20 or 30 years.

michael barbaro

Hm.

sarah kliff

Back then, a lot of the masks that were being used in hospitals were made in the United States. That really shifted about 15 years ago or so. You saw mask manufacturers, like other manufacturers, moving their operations offshore, where they could manufacture masks cheaper. A lot of them went to China. And if you think about it, you can manufacture abroad. You didn’t need a ton of specialized equipment, and then you could ship it right back to the United States. Orders are generally pretty predictable. At the time, it seemed like a prudent business decision for mask manufacturers to move their business to places where labor was cheaper.

michael barbaro

And so why is there now a shortage if this was a rational outsourcing decision with predictable deliveries from China to the U.S., that would allow us to create a stockpile?

sarah kliff

This system made sense when you understood the health care needs — when you knew a certain number of people tended to get the flu, so here is how many surgical masks you would need in a country. It really falls apart when you have a pandemic like coronavirus, which has spiked the amount of health care supplies we need. And all of a sudden, we’re in the situation where the surgical masks we want are half a world away. A lot of the transport that we rely on has been shut down. And other countries where the masks are being made are saying, we need these masks, too. This is particularly true in China, which had a coronavirus outbreak before us, and in certain cases has been holding on to its masks, not allowing manufacturers to export them abroad.

michael barbaro

Hm.

sarah kliff

So it made sense at the time, but it was not a supply chain built for the pandemic we’re in right now.

michael barbaro

So how solvable is this problem, given what you’ve laid out?

sarah kliff

It is solvable, but it takes time and it takes some kind of unusual measures. So one of the things you do see happening is factories being turned over to mask manufacturing.

michael barbaro

Mm-hm.

sarah kliff

And companies are trying to do that. If you look at Honeywell, for example, they’ve a factory that makes glasses and goggles usually. They’re going to turn that over to making masks, but they say it’s going to take about a month to make the transition. They’re going to have to hire 500 workers. You can’t just flip a switch in these factories that have been used from something else. And I think that’s why you see everyone trying anything possible. It’s why individuals are sewing masks at home and giving them to their local hospitals. That’s how dire the need is, that we’re really looking at any possible way to make a mask, even if it’s not in the traditional factories that typically manufacture them.

michael barbaro

OK, so that is masks. Where should we turn next?

sarah kliff

I think we should talk about hospital beds.

michael barbaro

OK.

sarah kliff

We’re facing a pretty dire shortage there, but for entirely different reasons. So the United States has significantly fewer hospital beds per capita than a lot of our peer countries and a lot of other countries that are fighting coronavirus.

michael barbaro

Hm.

sarah kliff

And you can really trace that back to a law that passed in 1974. This was about a decade after Medicare and Medicaid had come into existence, and all of a sudden, the government had become a huge payer of health care bills.

michael barbaro

Right.

sarah kliff

So they had a significant reason to be concerned about rising health care costs. And one of the things they started noticing was that when you had more hospital beds, they just seemed to get filled.

michael barbaro

Hm.

sarah kliff

It’s like when you add a lane onto a highway, you think it’s going to make the traffic better. It just turns out more cars show up and start using that route. The theory there being that however many beds you have, hospitals, which are businesses, they will find a way to fill them. So policymakers identified that having all these hospital beds was probably driving up costs, because hospitals had strong financial incentives to keep those hospital beds full. So in 1974, they passed this law that essentially required hospitals to apply for permission to build beds. So if I wanted to build a 500-bed hospital in New York, I’d have to go to the state and say, here’s why I think there aren’t enough hospitals in this area and why I should be allowed to build this new hospital.

michael barbaro

And what is the impact of that law on the number of beds in our system?

sarah kliff

It really limited the number of beds. We’ve shed about a half million hospital bed since 1974. I think that’s pretty telling.

michael barbaro

Wow.

sarah kliff

There’s other things driving this. Certain procedures that used to require a few nights in a hospital have gotten faster and safer, so you don’t really need that. Medicines have gotten better, so certain things that used to be treated with surgery, you can treat with prescriptions. But at the core of this, we really have made this decision that we want to limit the number of hospital beds in the United States. And that might help hold down costs in a normal time, but then we get to a pandemic and all of a sudden it becomes a real constraint on our ability to treat a wave of sick patients.

michael barbaro

Right. So we created this shortage on purpose, and with a reasonable motive that just wasn’t anticipating what it would mean in a crisis.

sarah kliff

Exactly. And when you think about hospitals, you have to remember they’re businesses. If you have an empty bed in a hospital, that’s a bed that’s not generating revenue. So hospitals try to operate pretty full. A lot of the ones I’ve been talking to tend to operate, particularly now in the middle of flu season, at like a 95 percent capacity.

michael barbaro

Hm.

sarah kliff

That means there isn’t a lot of slack in the system to surge up when you have a lot of patients who need care at once. Because hospitals are already generally so full, they just don’t have these empty beds sitting around for patients to use.

michael barbaro

Mm-hm.

sarah kliff

But now we’re seeing that not having slack in our health care system, not having empty beds that could be used when the need for health care surges, that leaves us really vulnerable in a situation like coronavirus, where you actually really want some slack in the system to treat those extra patients.

michael barbaro

OK, so that brings us to what I think is probably one of the scariest and most urgent problems of this pandemic, which is ventilators.

sarah kliff

Right. Ventilators are a crucial tool in fighting coronavirus. And the story of why we don’t have enough of them, it highlights probably better than anything else this incredible tension between the business of American health care and the ability to respond to a crisis.

[music]

michael barbaro

We’ll be right back. So, Sarah, what is the story behind our shortage in ventilators?

sarah kliff

So in 2006, the federal government creates an entire new division just to prepare medical responses to whatever sort of disasters it can imagine.

michael barbaro

Hm.

sarah kliff

And in its first year of operation, they started thinking about how to expand the number of ventilators. They thought that we would need about 70,000 extra machines in a moderate flu pandemic. And one of the things they noticed is that we did have some ventilators in a national stockpile, but they weren’t really ideal. They were big, they were expensive, so you couldn’t order a lot more of them. They required a lot of training. So they come up with this idea that the federal government should develop a ventilator that is the opposite of all of that.

michael barbaro

So the U.S. is going to get into the business of making its own ventilators.

sarah kliff

Exactly. Well, they’re going to outsource it. So they’re going to find a private partner who already makes ventilators and asks them to design something to their specifications. And what they want is a machine that is cheap, that is lightweight, so you can move it around, that doesn’t require a lot of training to use. And they set out to find a private company that is willing to build such a ventilator. And a small medical device company in California called Newport Medical raises their hand, and they are really excited about it. They think it would be really prestigious to work with the government. They want to build this device, and they get the contract.

michael barbaro

Mm-hm.

sarah kliff

For the first two years, things go pretty well. Newport Medical actually creates three working prototypes, and they ship them out to Washington, D.C., where officials are excited. They see this thing they wanted to build, and they can start envisioning it as part of the national stockpile.

michael barbaro

Hm.

sarah kliff

So everything really seems to be going as planned until May 2012. That’s when it’s announced that Newport Medical is being purchased by a much larger medical device company called Covidien. Newport Medical was worth about $100 million. Covidien was worth $26 billion dollars.

michael barbaro

Wow.

sarah kliff

Just a magnitude larger company that makes all sorts of devices, whereas Newport Medical, the only thing they did was make ventilators.

michael barbaro

Mm-hm.

sarah kliff

The government officials who worked on the contract say they saw kind of an immediate change in how things were going. The larger company didn’t seem quite as interested. They requested more money to finish the contract. And at the end of the day, late 2013, early 2014, the contract just falls apart, and the ventilator is never built.

michael barbaro

Hmm. Sarah, what’s your sense of why this larger company, Covidien, didn’t want to make this ventilator? I mean, if it was prestigious enough for this little company, why wasn’t it prestigious enough for this bigger company?

sarah kliff

Yeah, when I talked to former government officials, they had a sense that Covidien didn’t want to manufacturer a lower cost ventilator that would compete against their higher cost ventilators that were already in the market. You know, it doesn’t make a lot of sense for them as a business to introduce a product that’s going to earn less money into the marketplace.

michael barbaro

So basically it wasn’t economically advantageous for this big company.

sarah kliff

Exactly. Even more than that, it was economically disadvantageous to have this other product on the market. Covidien executives, they tell a different story. They felt like the government had unrealistic expectations. That when they came in, purchased this small company, they realized this project was just not feasible and ultimately had to negotiate their way out of it with the government. In any case, once this company was purchased, the contract was never finished and the ventilator that was supposed to be designed was not designed.

michael barbaro

So all of a sudden, this ahead-of-its-time, pre-planned program to make sure the U.S. has enough ventilators is not producing ventilators that the U.S. may eventually need.

sarah kliff

Right. And the government does keep trying. They redid the contract after this one falls apart, and they award it to Philips, another very large company. The thing is, it was too late for the crisis that we’re in right now.

michael barbaro

Hm.

sarah kliff

So we’re in a situation where the government spent 13 years, about $20 million trying to build a device that could respond to a pandemic outbreak, and we don’t currently have any ventilators to show for it.

michael barbaro

Hm. And so where does that leave the United States’s stockpile of ventilators? How many do we have versus how many we expect to be needing in this moment?

sarah kliff

There are about 16,000 ventilators in the national stockpile that have been serviced recently, are ready to go out to American hospitals if needed. But back in 2007, when this whole effort started, the government estimated we’d need about 70,000 ventilators. So we’re obviously still quite short of that number.

michael barbaro

And what is the federal government doing in the face of this ventilator shortage?

sarah kliff

So they are figuring out how to best use the stockpile. That effort is a little bit mysterious to the public. We don’t exactly know which states are going to get which ventilators, when they will be released and how that will roll out. What is happening a little more publicly, and would likely produce more ventilators, is companies ramping up their production of new units.

archived recording (donald trump) Thank you very much. It’s great to have you.

sarah kliff

You really see that in two ways. One is trying to get other manufacturers, particularly the car manufacturers, to start making ventilators.

archived recording (donald trump) This afternoon, I invoked the Defense Production Act to compel General Motors to accept, perform and prioritize federal contracts for ventilators.

sarah kliff

This is something President Trump has put some pressure on the industry, on General Motors to start doing.

archived recording (donald trump) This invocation of the D.P.A. should demonstrate clearly to all that we will not hesitate to use the full authority of the federal government to combat this crisis.

sarah kliff

And while it is well-intentioned, it’s an effort that’s going to be pretty challenged.

michael barbaro

Why?

sarah kliff

Well, the thing to know about ventilators is they’re complex machines that really cannot malfunction. We’re talking about machines with hundreds of parts, that if they stop working, a patient stops breathing.

michael barbaro

Right.

sarah kliff

So you need them to be put together correctly, and you need all those hundreds of parts to be at the exact right spot. That’s not something a technician learns to do overnight. So when I’ve talked to some of these ventilator manufacturers, asking them, do you think an automobile company could make these, they’re a little bit skeptical.

michael barbaro

Hm.

sarah kliff

They worry that the expertise isn’t there, and some training is really going to have to happen before you can turn a car assembly line into a ventilator assembly line. The other thing we see happening is the ventilator manufacturers themselves ramping up. They are adding second shifts. They are bringing in more workers. But that’s really limited by labor supply. One of the things that’s really hard right now is you’re trying to bring workers into a factory in the exact moment when the government is asking people to stay home. So increasing work at a factory means providing protective equipment to those employees. It means doing temperature checks when they come into the factory to make sure nobody gets sick. When I talk to ventilator manufacturers, the key constraint they’re facing isn’t enough assembly lines. It’s enough people to work on those assembly lines and who have the knowledge to work on those lines. That’s really what stands between us and having a larger number of ventilators.

michael barbaro

So despite all this activity we’re hearing about, despite the invocation of the Defense Production Act, despite car companies saying they’re going to start making ventilators, I’m hearing you say that there’s not going to be tens of thousands of ventilators suddenly rolling off some assembly line and solving this shortage in the next couple of weeks.

sarah kliff

Exactly. And I think that’s why you see hospitals experimenting with how to expand the work of the ventilators they have. Some of those experiments are using one ventilator to support multiple patients. Another one is taking the anesthesia machines that would be used in surgery, and with elective surgery being canceled, retooling those as ventilators. These are not things that would be happening if it were business as normal, but it’s obviously not business as normal. And because the hospitals, particularly those in New York, are waiting for ventilators, they’re starting to see how they can expand the capacity of the ventilators that they already have.

michael barbaro

Sarah, the three examples that you have take us through — the masks, the hospital beds, the ventilators — each of them seems to share the common theme that our preparedness for something like this pandemic, which people been warning about for so long, was undermined by the simple fact that our health care system is driven by profits.

sarah kliff

Right. The thing to know about American hospitals, about device makers, is they’re just like any other business. They have to turn a profit and bring in revenue to stay open. But there’s also something that makes them really different. We absolutely need them in a pandemic situation like the one we’re in now, in a way we don’t quite as much need restaurants and car makers and other manufacturers. They’re playing a crucial role in our safety net, but at the end of the day, we don’t have a tool we’re using to prevent them from being what they are, which is businesses.

michael barbaro

So, Sarah, there is a corner of our economy where everything you have just described is true, and yet the federal government always finds a way to make sure it gets what it needs. And that is the military. There is a principle in the United States that the U.S. military has to be able to fight multiple wars at the same time, and the United States government and our taxpayer dollars make sure that that always happens. So we know this is possible. It’s just that the government hasn’t tried that, it seems, when it comes to a stockpile for health care.

sarah kliff

I think a lot of public health officials would agree with that. The ones I’ve talked to say that if we wanted to, of course we could build a giant national stockpile. It’s a question of priorities and a question of funding.

michael barbaro

Mm-hm.

sarah kliff

They see the cycle that happens to the United States, where there’s a bad pandemic disease, it reveals flaws in our system, and suddenly lawmakers are talking about wanting to commit a lot of money. But the money never quite seems to come through. A year or two later, there are other things they want to spend government money on. It kind of fades into the background until the next pandemic hits. Right now, we seem to treat military threats as real, as something we need to be prepared against.

michael barbaro

Hm.

sarah kliff

We don’t really treat public health threats the same way. But I think what one of the lessons of coronavirus might be is that the public health threats are just as real as the military ones, and it takes a lot of planning and a lot of money to be prepared for them.

michael barbaro

Thank you, Sarah.

sarah kliff

Thanks, Michael.

michael barbaro

The Times reports that in response to the shortages, the Trump administration has begun airlifting supplies of protective gear, including masks and gowns, from China to the United States. The White House said it would make 22 such flights by early April. We’ll be right back. Here’s what else you need to know today. As deaths from the coronavirus climbed in Italy and Spain, both countries tightened restrictions on the movements of their citizens. Spain called for a period of quote, “hibernation,” saying that only essential workers could leave their homes, while Italy said that its national lockdown would be extended until the middle of April.

archived recording (roberto speranza) [SPEAKING ITALIAN]

michael barbaro

During an interview, Italy’s health minister, Roberto Speranza, warned that loosening the restrictions too soon would, quote, “burn everything we’ve obtained until now.” In the U.S., the virus is now spreading to Midwestern cities like Detroit, where there have been at least 35 deaths and 500 police officers are now under quarantine.

archived recording (mike duggan) There’s no question that we have more density, and we’re more at risk. You’re also seeing the Chicago area and the New Orleans area are also hotspots, and you’re going to see this again and again.

michael barbaro

On Monday Detroit’s mayor Mike Duggan predicted that many mid-sized American cities would be next.

archived recording (mike duggan) Major cities in America that are destinations, that lots of people come into are likely to develop. And I think it’s a matter of time before you see Philadelphia and Houston and some other cities develop the same way.

michael barbaro