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The other ways health care will change

That’s the title of a talk I’m giving today at the New York Academy of Medicine. There’s a lot of discussion around the major changes associated with health reform; access to care concerns, fear of adverse selection, provider and payer integration, Exchanges and Medicaid expansion.

The key is understanding that health insurance has fundamentally changed.  Today, health insurers make money by underwriting; figuring out who is going to have claims, avoiding them if possible and budgeting for the claims they can’t avoid.

That’s over.  Now, success will be driven by branding, marketing, and population health management.  Those are areas of expertise not associated with health insurers, ones they are trying to understand/obtain/build as fast as they can. That is perhaps the biggest change coming, a 180 degree shift in business operations and focus.

Here are the other changes on the horizon…

Disability Management will be the next big thing – buyers will want to know what they get for their dollars, and that deliverable will be healthier, more productive people.

Broad access is over.  Amidst all the caterwauling about small networks and restricted benefit plans is a hard truth; providers will give better deals to health plans who can direct patients to them.

Rise of the non-physician will be rapid and reach surprising heights. No question there aren’t enough docs to deliver the same medical care to more people – but that assumes that is the right care (which about a third is not) and docs should be delivering this care – which in many instances is not necessary.

(Almost) every state will expand Medicaid.  When Medicaid was first introduced in the sixties, many states did not go along – initially.  Yet all did within a few years.

Vertically integrated systems will be big winners.

Medicine will become less art and more science.  This goes to the heart of the first issue; a lot of care is the wrong care, delivered at the wrong time, in the wrong setting.  Within ACA is significant funding for outcomes research and dissemination, and the work is proceeding at a rapid pace.

Hospitals will get back to basics.  While some will continue to spend billions on fancy technology and patient rooms, most will not see much of a payoff from that investment. Instead, expect facilities to focus on streamlining processes, improve administrative efficiency, and reduce costs.  They have to in order to survive.

Revenue maximization will get ever more sophisticated.  Providers are getting really smart about coding, payer contract negotiations, and reimbursement “management”.  Payers who are vulnerable (that’s you, property & casualty) are going to get hammered.


What does this mean for you?

Prepare.  Watch, listen, and read.  The world is changing, and it will affect you.  

3 thoughts on “The other ways health care will change”

  1. I’m sure this will be an interesting presentation. From a clinical perspective, I agree with your comment regarding the infusion of non-physician caregivers. The VA system has successfully integrated physician extenders including PA’s and nurse practitioners to diagnose and clinical pharmacists to manage medication therapy for years. The patient benefits from increased access to care, physicians benefit from collaborative partnerships and risk sharing, and the system/payor benefits from reduced cost of care and improved patient outcomes. Would love to see this expand outside the federal space.

  2. I think the theory that health insurers will be successful in managing or altering wellness in a insured population

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Joe Paduda is the principal of Health Strategy Associates



A national consulting firm specializing in managed care for workers’ compensation, group health and auto, and health care cost containment. We serve insurers, employers and health care providers.



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