Looking back, 2018 was a year of both great success and significant challenges for healthcare. While CMS reported that healthcare spending reached $3.5 trillion as per the latest data, the total spending growth slowed for the second year in a row. As we move closer to the healthcare of the 2020s, all federal and private organizations are firmly shifting their focus toward reducing the soaring cost, while at the same time, improving care quality and patient experience. Some of the things that everyone in the healthcare sector should look forward to in 2019 are:
1. The progress of value-based care and the emergence of intelligent data analytics systems
Most experts believe that organizations will never be paid more than they are today, and that margins will become tighter with each passing day. In such times, organizations who are able to manage their resources efficiently and bring down their utilization levels will emerge as winners. As we inch closer toward the third decade of the 21st century, making peace with the 30% healthcare cost wastage rate seems hardly improbable and unacceptable.
Forbes predicts that 15% of global healthcare spending will be tied to value-based care models by the end of this year, more so for countries like the US which spend more than 10% of their total GDP on healthcare. In recent years, healthcare economic models have grown in significance, and focusing on end-to-end care and cost management has become a must.
For adding value to the care being delivered, organizations will need to channelize their efforts toward enabling preventive care models and checking on their patients more regularly. For more proactive and accurate decision-making, healthcare organizations will look for coming-of-age methods. Undoubtedly, for their efforts to become successful in this direction, they will require contextual information into their population health at all times. The push for value-based care will be accompanied by huge investments in predictive care solutions.
2. Medicare Advantage plans will grow in significance
CMS predicts that 83% of the beneficiaries will have lower premiums in 2019 as compared to the past year. On average, Medicare Advantage (MA) premiums are estimated to decrease by about six percent to $28.00 this year as compared to $29.81 in 2018. Further, the enrollment may also hit an all-time high of 22.6 million beneficiaries.
Many new payers are entering the MA market, and with the ever-increasing number of enrollees, the options are also increasing for the senior citizen population. To put this in numbers, MA will be offering about 3700 plans in 2019, 600 higher than last year. Further, about 91% of people with Medicare will have access to 10 or more MA plans as compared to 86% in 2018.
With about 36% of the total Medicare beneficiaries projected to be enrolled in MA plans in 2019, CMS will look to reduce costs and improve care quality with the help of private sector payers.
3. Major technology players and equity firms will continue to make big investments in healthcare
The Amazon-Berkshire-JPMorgan Chase venture became a major talking point in healthcare circles throughout 2018. Similarly, Apple also ventured into the healthcare market with Healthkit, while Google tightened its grip on DeepMind, an AI research lab it acquired for £400 million in 2014 ─ both aimed at bringing care closer to patients.
One such study predicts that private equity firms will continue investing in healthcare and the numbers may shoot up to 747 such deals in 2019. Investments in healthcare are not new, but the high level of deals in 2017 and 2018 all but affirms the possibility of more dynamic bidding processes in 2019.
4. Population health and chronic care management will remain in focus, and so will SDOH
It is estimated that 6 in 10 Americans suffer from at least one chronic illness, while 4 in 10 suffer from 2 or more chronic diseases. Transitioning from a disease-centric to wellness-centric healthcare system will require efforts in the direction of chronic care management. Such efforts, coupled with personalized care plans and insights driven from the Social Determinants of Health (SDOH), can drastically help to reduce the cost of care. As organizations remodel their care delivery structure to thrive in a risk-sharing, value-based environment, chronic care management will firmly stay in the forefront of their minds.
To provide a more comprehensive care experience, combining Population Health Management (PHM) strategies with SDOH data can be very effective. Organizations can make substantial strides in the direction of imparting personalized care if they are able to look after individual patients, and hence the population. As we dream of a new future of healthcare efficiency, organizations should reconsider their strategies of leveraging SDOH in 2019.
According to a recent survey, 68% of the respondents were challenged by a social risk factor which impacted their medical encounters. As organizations aim to provide a more holistic experience to their patients, SDOH will play an even greater role in the future. In fact, payer organizations will also focus on SDOH data as they play a more active role in managing the health of their enrollees.
To effectively manage patient population spread across multiple facilities, having entire patient records in one single place is also extremely essential. With the aim of imparting quality care and improving overall reimbursements, most organizations will focus on creating a data-driven strategy, and PHM will remain a key area of focus for most organizations. Unsurprisingly, the PHM market could account for more than US$ 45 billion by the year 2023, growing at a CAGR of about 24%.
5. Mergers and financial securities remain a question mark
Organizations that lack the right strategies, technologies, and funds may find it hard to thrive in a rapidly changing environment. According to an estimate, the US healthcare system may see up to 150 facility bankruptcies or shutdowns over the next 16 to 18 months.
The healthcare marketplace also looks ripe for acquisitions and consolidations in 2019. The $5.7 billion acquisition of athenahealth ruled the tabloids during the latter part of last year. Small hospitals, in particular, are more vulnerable today and therefore leaders may come together to create thriving organizations. More specifically, mergers may emerge as an avenue for survival for small healthcare organizations. In general, leadership sees mergers as a potential solution to improve their quality reporting and regulation adherence, apart from improving their overall revenues and providing a holistic care experience.
6. ACOs will be at the center of transformation
CMS is working towards making the entire ACO ecosystem more value-driven. The recently finalized “Pathway to Success” initiative, for instance, will overhaul the MSSP program and make ACO participants assume downside financial risk sooner. The new Medicare ACO program will reduce the amount of time that an ACO can stay in an upside-only risk-sharing track from 6 years to 2 years. For new, low-revenue ACOs, including some rural and physician-led organizations, the period is fixed at 3 years. As per CMS, the new rule will save $2.9 billion in the next ten years.
The piece of the puzzle left is to find out how ACOs will take it. A 2018 survey conducted by NAACOS found that more than 71% of the total Track 1 ACOs may leave the program if they are forced to take downside risk, and those who chose to stay, will face the heat if they are not equipped with the right technologies to sail through the challenging environment.
In 2019, it will become almost a necessity for ACOs to have cutting-edge data analytics solutions to identify opportunities, close care gaps, and identify vulnerable patients for quality improvements and cost-cutting. As more and more organizations adapt to improved technology, one can argue that 2019 will see chain reactions of sorts in this space. The prospect of many small and large ACOs establishing healthcare data integration and analytics platforms which follow the examples set by other organizations looks very promising.
Additionally, the new ruling will expand the coverage of telehealth solutions in the value-based care ecosystem─ a step which can be seen as a push for advancing digital health and patient engagement in the future. In fact, the new act will empower the participants to offer incentives to beneficiaries for improving their health outcomes. While patient engagement has been a much-talked-about topic in the past, the new initiative will give it the boost it thoroughly needs.
7. The significance of AI and Machine Learning will grow by leaps and bounds
Most industries around the world are welcoming AI-enabled solutions to enhance their productivity and efficiency. However, many healthcare organizations have been apprehensive about the role of AI in healthcare in the past. Many end-users were not convinced about the very need of an AI-enabled solution, say a decade back. One of the major concerns, as cited by many people familiar with the development, had been the additional costs associated with establishing a new infrastructure.
Amid the growing administrative burden on providers, automating their workflows will gain more traction in the near future. It will pave the way for more comprehensive AI and Machine Learning applications flooding the healthcare market in 2019.
With evolving payment models, increasing patient awareness, and the ever-increasing amount of clinical and non-clinical data, AI will play a significant role in 2019 and beyond. These algorithms are more precise and provide physicians and care staff with more accurate insights to power clinical operations. As organizations push for personalized care, these AI-driven insights will have a significant impact on the overall quality of care delivered in the future. According to Forbes, the global AI market for healthcare will reach $1.7 billion by the end of 2019 and will grow at a CAGR of 68.5% from 2018 to 2022.
More than 95% of the hospitals eligible for Medicare and Medicaid achieved meaningful use of certified health IT technology two years ago. Almost all hospitals across the US possess a basic IT infrastructure, and the trend will only see an upward trajectory in 2019. In particular, hospitals that manage a large number of patients on a daily basis will continue leveraging centralized command centers to identify the at-risk population, drug utilization, disparities in billing, among others.
The demand for AI-assisted command centers will continue to grow in 2019. These command-centers will act as a wheel of transformation for healthcare organizations looking to manage their patients, improve the care experience, or take the unnecessary burden off the shoulders of their providers.
8. A breakthrough year for digital health?
It is safe to say that organizations now weigh the well-being of patients at home as much as in their facilities. The healthcare paradigm has shifted from merely treating diseases to ensuring better population health. To ensure the well-being of patients in their homes, digital health technologies have grown in significance over the last few years.
According to Statista, total US telehealth visits in 2019 can reach the magic figure of 50 million, up from 22 million in 2016. As per another estimate, the telehealth market in the US is estimated to reach $2.8 billion by 2025. An increasing rate of chronic diseases, incentives from federal agencies, an aging population, and increasing penetration of smartphones will drive this growth.
Likewise, the global mHealth applications market has the potential to reach $102 billion by 2022. Such apps, which are used for purposes such as patient education and chronic care management, will grow at an unprecedented rate.
In months to come, we will see both market giants and emerging firms penetrating the digital health market with cutting-edge solutions and apps. While such solutions will allow providers and payers to monitor patient health trends in real-time, they will also empower patients with contextual information to enable self-management.
9. Fight against opioid misuse will become more intense
According to the CDC, more than 49,000 people died from opioid overdose in 2017. In the same year, HHS declared the epidemic as a public health emergency and unveiled a five-point strategy to combat the problem. Last April, the National Institutes of Health launched the HEAL (Helping to End Addiction Long-term) Initiative to tackle the opioid crisis.
The Controlled Substance Utilization Review and Evaluation System, or CURES, launched by the state of California is a famous ruling that mandated physicians and prescribers to consult the CURES database before prescribing, ordering, administering, or furnishing a Schedule II, III, or IV controlled substance. Few other states such as New York, Kentucky, and Tennessee also require prior consultation with a database.
The real challenge, however, is to ensure that physicians have the right tools to utilize these databases effectively. The year 2019 may see healthcare organizations leveraging health IT solutions to get the right insights at their fingertips ─ something that is essential to make the most out of such mandates.
10. Organizations will find innovative ways to eliminate the risk of data breaches
Between 2009 and 2017, healthcare breaches exposed more than 50% of the US population. Apart from spear-phishing and malware attacks, vulnerabilities in existing infrastructure have contributed significantly to the rise of such incidents.
In 2018 alone, breaches resulted in the exposure of 13,020,821 healthcare records as per the Department of Health and Human Services’ Office for Civil Rights (OCR). In 2019, HHS will work closely with healthcare leaders and stakeholders to increase awareness regarding the issue and implement proven practices to reduce data breaches.
Ransomware attacks are a major area of concern for healthcare organizations. In 2018, SamSam ransomware hackers extorted about $6 million from healthcare organizations who suffered from such attacks. Apart from external threats, healthcare organizations should also create strategies for tackling data breaches caused by user authentication, endpoint leakages, and multiple access and user permissions.
While more than half of all healthcare professionals have started encrypting their data and most organizations have increased their cybersecurity spending, organizations still need to spend wisely on building a secure health IT infrastructure. Across industries, about half a million cybersecurity jobs in the US remained unfilled in 2018, a number that we should all work on reducing, if not eliminating in 2019.
The road ahead
Traditionally, US healthcare has lagged behind other industries when it comes to adopting new-age technologies or creating customized solutions to target specific pain-points of the caregivers; however, disruptions in healthcare are on the rise with new and established players pushing aggressively for revamping our care delivery system. Many things are set to change this year, while many others will finally come of age and grow in significance.