Exit strategy options

Prime Minister Scott Morrison says the government will favour “low-risk, high-value” activities when it begins to relax social distancing measures and that Australia will likely open its borders to New Zealand before any other country.

The pandemic exit strategy is the hottest topic in the country now that the infection rate appears to have stabilised.

Independent actuarial firm Rice Warner has come up with its own suggestions for a smooth transition to ‘normality’. Michael Rice, Alun Stevens and Michael Berg offer the following information on containment and how those experiences could shape our exit strategy.

Do nothing much
“The US and UK did this initially, and it continues to be the stance of Brazil and Iran – and the virus has spread much further into their populations as a result. This could be the least bad option for countries with young (less vulnerable) populations that lack the economic resources to sustain protracted lockdowns.”

Herd immunity while flattening the curve
“Sweden is systematically allowing some spreading of the virus while encouraging older and other high-risk people to self-isolate, but this is now under stress as the older groups have not been protected and death rates are rising. The UK’s herd immunity strategy had to be abandoned when it became clear that it would not achieve sufficient reduction in caseloads for the National Health Service to provide proper treatment.”

Hard and late
“Italy, Spain and France were quickly overwhelmed. They ran out of medical resources and many people have died through lack of treatment or survived with serious long-term health damage. The UK is now at risk of joining this group. In hindsight, adequate medical resources seems to be one of the most critical items to reducing the death rate – having enough respirators and intensive care units to cope.”

Whack-a-mole – the current situation in the US, with different states taking different steps at different times
“Bill Gates describes this as ‘a recipe for disaster’. He views the top priority as having a consistent approach in strategy across different states, otherwise the infection will keep travelling backwards and forwards. He argues the position should be that ‘shutdown anywhere means shutdown everywhere. Until the case numbers start to go down across America – which could take 10 weeks or more – no one can continue business as usual or relax the shutdown. Any confusion about this point will only extend the economic pain, raise the odds that the virus will return, and cause more deaths’.”

Hard and early
“South Korea, Taiwan, Singapore, NZ and Ireland have tried to quarantine those carrying the virus hoping to eliminate it while enforcing significant social distancing. The more successful strategies have been characterised by extensive testing – and use of test results to implement targeted quarantines and inform policy decisions. Australia actually went ‘Hard and late’. We were not testing sufficiently and were poor on quarantining, however, our isolation and subsequent actions have protected us from similar fates to other countries.”

Mssrs Rice, Stevens and Berg acknowledge that a vaccine could be 12 to 18 months away and that the virus is dangerous for four key groups:

  • The elderly. Statistics show that the death rate is much higher for those over age 70, and particularly those over age 85.
  • Those in confined places. The epidemic has spread in cruise ships, aged care facilities and now in US and French aircraft carriers.
  • Health workers. Fit and healthy people have died, suggesting that extensive exposure to the virus has a cumulative adverse effect. More than 100 doctors have died in Italy and several NHS medical staff have died in the UK.
  • Those with existing respiratory ailments or other severe co-morbidities such as diabetes, cancer or heart problems.

So, a likely exit strategy?

“We could potentially isolate those at risk which might be 15 per cent of those over age 60, all of those over 70, and younger people with a history of major illness (diabetes, heart disease, respiratory problems and cancers),” the trio say.

“We would also isolate people living with these high-risk people. The problem is ensuring the isolation is enforced and sustaining the people so isolated for the six to 12 months of isolation that would be required.”

The actuaries highlight Australia’s advantage in being an island so we can test anyone arriving and keep out future transmissions. They say we need to trust the hypothesis that healthy lives will recover without hospital treatment. Therefore, we must try to isolate riskier lives (and those living with them). We allow the safer lives to return to the economy but, accepting the risk of a major outbreak, they say we need:

  • Recognition that there are no risk-free options, and that one-dimensional strategies that fight the virus without reference to the economic implications will kill more people from poverty and mental health issues than they save from the virus. The approach needs a careful balance between expanding economic activity and preventing the virus spreading exponentially.
  • Phased introduction – perhaps by geographical region; starting with schools due to the low levels of health risk to younger people and the double-whammy of disrupted education for children and disrupted work for parents if schools are closed or only notionally open.
  • A plan to deal rapidly with localised outbreaks by identifying, quarantining and testing people who may have been exposed to infection.
  • A plan to lockdown again (perhaps by region) if the strategy does not work. Acknowledgement that some people will not follow the rules – so some high-risk people will be exposed by having contact with (say) family members.
  • Acknowledgement that mild or asymptomatic cases could lead to further outbreaks.
  • Full testing within regions to ensure local elimination – as done in the North Italian town of Vo. While this could be viewed as intrusive, it is far less intrusive than requiring people to give up their livelihoods.
  • Recognition that frequent heavy exposure kills healthy people – so we need to minimise people needing hospital care.

The trio says that the risk of going early is large but could be managed progressively, while the risk of staying out longer will be crippling for the economy.

“The further risk of staying out longer once community transmitted cases have reduced to very low levels is that the community will simply stop complying.

“We can expect a slow relaxation of restrictions and a slow restarting of the economy with an ultimate return to whatever the new normal is, once a vaccine is freely available – likely to be available sometime late in 2021, but possibly earlier given the resources working on it.”

Does the Rice Warner exit strategy make sense to you? Do you think this is the likely way Australia will go? Are vulnerable groups sufficiently protected?

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Written by Janelle Ward


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