If your ICU is at 80% capacity, with 20% COVID and 60% everything else, that means you can DOUBLE the number of COVID patients there before running out of space, whereas if all of the patients were COVID patients you could only accommodate an increase of 25%.

Yes, hitting 100% is bad no matter what percent of patients are there because of COVID. But what percent of patients are there for COVID informs how large an increase of cases can be managed.