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2016 and Beyond

2016 and Beyond

We have no special powers. We are not clairvoyant. Rather, we have lived within the healthcare management world for nearly 100 years, combined. We all recall the days docs made house calls. Being entrenched in the ever changing health care scene, the three of us made many predictions. Some of which, people may have thought were ludicrous. But, today, they are all a part of health care reality.

Following are visions we see in our crystal ball. These trends will become more visible in 2016 and beyond.

1. Turmoil will accelerate as insurance companies merge and opt out of the exchanges. Make no mistake about it, insurance companies are not benign payers in the healthcare marketplace. They are much more important to healthcare delivery than is the government. As they consolidate, they drive and control the providers’ business. The higher premiums paid by every insured person affects care because it forces people to choose a higher deductible plan in order to hold down monthly premium cost. And, the higher deductible plans drive providers crazy because they, in turn, are forced to collect more from a patient who is already angry at having to choose a less desirable plan”

2. Most healthcare consumers are currently in the dark. The onus will be on the patient, and the market will provide tools to educate them on their health care choices. Entrepreneurs will take advantage of this growing trend and create apps for mobile devices that enable consumers to be more informed. Outcomes by physicians and providers will become more accessible. Providers will boost their marketing efforts, based on transparency, to attract patients similar to bariatric and laser eye surgery services have been doing for years. Likewise, prices will become more visible and promoted.

3. Healthcare services will evolve like the airlines, to a few players on an enormous field. Local/Regional providers will venture out of their home state and serve the entire country. As they accelerate, and intensify their focus on the consumer, access and high value will be drivers of organizational change. Regional providers will grow larger in order to become stronger, but they will soon realize that size alone will not ensure success. All providers, regional and national, will become more sustainable only through reorganizing themselves to insure ease of access and high value (translation: efficient and high quality) services.

4. Doc in the Box will be the norm. Retailers such as Walgreens, Target, CVS and Walmart will expand services and attract more regular health care customers. Other companies that offer clinical services, such as Cancer Centers of America, will become more expert at marketing and we should expect more patient travel out of their home area as a result.They have only five locations in the country, but they advertise everywhere. They promise same day or next day appointments, the latest in cancer treatment, and by all reports they provide excellent customer service. Even though this is a clinical operation, their strength is marketing. They do not offer free care. It seems to be working; and with only five locations, patients must travel.

5. Rising drug costs will cause more intensive government review and involvement. Price controls may be considered. Other countries put a cap on the price of drugs. Congress attempted to get the same price for Medicare patients that the VA was able to get by buying in bulk. The idea is that if one agency of the government can get cheaper prices all agencies should get it. But, Medicare is not a provider like the VA, it is only a payer and the pharma lobby got this provision squelched. There was also a legislative proposal to allow Medicare patients to buy drugs in Canada; but this was also squelched by the lobby.

6. We will see rural health deserts. State budgets are being pummeled, and health care is being hit hard. These shortfalls result in lower Medicaid payments, and reduced access for many in rural areas. Providers in urban centers have also refused Medicaid. But the urban Medicaid eligible patient usually can access a service of some kind and thus get care. This is not true in rural areas where care options are extremely limited, distance is sometimes great and even though a provider may offer care to a Medicaid patient, that provider will soon be out of business because of such low payments with no way of supplementing revenue from philanthropy or tax payments.

7. Employers will feel the pinch. Accelerating healthcare inflation will result in aggressive responses by employers. Employee premiums and deductibles will rise. Another potential scenario is forcing employees to shift to a voucher approach leaving the employee totally responsible for securing their own coverage.

8. Hospitals will be lean and mean. Productivity will be the goal. “Assembly line/manual labor-focused” improvement efforts will result in declines in healthcare staff engagement, loss in service delivery and more clinical personnel seeking non-hospital working environments which will in turn accelerate increasing costs creating a downward financial spiral.

9. The Affordable Care Act (ACA) is here to stay. Anecdotal stories abound, some proclaiming success and others screaming for a dismantling of the program. If nothing else, the ACA has significantly raised awareness of the many healthcare issues. The genie is out of the bottle, and turbulence is bubbling in the industry. A repeal is unlikely to happen. However, amendments may be forthcoming if expected outcomes are not achieved by deadlines set in the original legislation or due to some political expediency.

10. Information Technology sophistication will be a silent driver of profound change. Major IT systems are becoming dominant. As more corporate consolidations occur, more alignment on IT platforms occurs. The result is standardization of processes, and, in turn, required behavior change by providers. IT will move from programmable computers to cognitive systems and there will be more reliance on machines and less on clinical expertise.