Politically, economically and legislatively, 2017 was a tumultuous year. Our predictions for the 2018 healthcare market and some practical recommendations for action are described below.
- Passage of tax reform will fundamentally impact the insurance market. The recently-passed GOP tax plan removed the Affordable Care Act’s individual mandate. Federal insurance exchange marketing efforts and enrollment periods have already shrunk significantly and President Donald Trump paved the way for far less comprehensive coverage via association plans. The GOP will be calling Democrats to the table to discuss replacing President Barack Obama’s signature healthcare reforms. Cuts to Medicaid, Medicare and Social Security aren’t far away.
Advocate for Medicare and Medicaid eligibility, coverage and funding. Target the highest levels of decision-makers to effect change.
- Other fierce public policy battles will continue. There is no doubt that 2018 will see continued positioning, lobbying and fighting for specific reforms, coverage, affordability and access. As coverage and affordability are affected, issues like health equity and disparities will also be fiercely debated.
Prepare to fight for what you believe in, whatever that may be.
- The opioid epidemic will worsen. All the epidemiological evidence points to worsening opioid mortality numbers in the next few years. In the past five years, adolescent mental health morbidity and suicide deaths have risen and, sadly, will rise again before our efforts take effect. Overdose and suicide are inextricably tied to other social and cultural phenomena like poverty.
Focus on your mission as well as your place in the market. Address the philosophical gaps that exist between provider types as to what constitutes evidence-based treatment. Bridge the chasm between abstinence-only, harm reduction, and medication-assisted treatment. Focus on getting people into treatment and providing varied treatment options in the life-saving spirit of collaboration rather than competition.
- Enforcement of the Mental Health Parity And Addiction Equity Act will be required. We must remain vigilant with the enforcement of the law; 2018 ought to be the year to hold insurers and Medicaid managed care plans accountable for parity. Organizations like the Legal Action Center and the Coalition for Whole Health are making tools and other resources available to providers and advocacy groups. Disparity affects reimbursement rate-setting, compensation and workforce retention. The problem of low pay will be aggravated as health systems require enhanced professional standards.
Lean on your associations to actively seek enforcement from state Medicaid agencies, insurance commissioners, and federal agencies such as the Centers for Medicare and Medicaid Services (CMS).
- Value-based reimbursement and shared risk will become the norm. The transition away from fee-for-service toward pay-for-performance, bundled payment and subcapitation will continue. Value-based reimbursement adds value in terms of outcomes per dollar but also pushes risk down to providers.
Formulate bundled and episode payment models now so you have something to bring to the negotiating table. Otherwise, you will be on the receiving end of an offer you may not be able to refuse and that you may not be able to survive. They don’t call it “risk” for nothing.
- Population health management and the focus on social determinants of health will spread. Enlightened payers and providers are increasingly attentive to population health and social determinants of health management as a way of driving down costs and increasing health outcomes. Traditional health plans, self-insured employers, Medicaid, and Medicare are all proponents of the model and have begun to integrate social determinants of health into service programming and outcome evaluation.
Be an active part of the design and implementation of population health management programs. Prepare your organization for shared financial risk and develop a deep understanding of population health informatics in the coming year.
- Integration will spread and mergers and acquisitions will increase. The deep integration of payers, providers, high-tech, retailers and administrators is central to innovation and system redesign. At this point, it’s an inescapable force in the market.
Look for your opportunities to integrate vertically, horizontally and in entirely new directions. Engage potential partners. Read and look for examples from elsewhere in the country and from other industries. Develop ideas into rapid-cycle business model scenarios and rule out what doesn’t appear to quickly generate a margin, leaving feasible and viable ideas for prototyping. Speed-to-market is key.
2018 will be a great year for payers and providers who can innovate and exercise great agility in this turbulent climate. The future is bright for those who are attuned to and are able to respond to the changes in the market. Happy New Year!