Not Just the ACA Is Shaping the Healthcare Industry

The Affordable Care Act (ACA) is only one factor that will rapidly reshape the healthcare industry in 2014, according to a report by PwC’s Health Research Institute (HRI). Kelly Barnes of PwC said, “While health insurance exchange implementation is driving headlines, the next 12 months will be marked by…a range of core business challenges. Businesses must address rapid innovation and competition from non-traditional players but, above all, they must respond to empowered consumers as customer-centric transformation sweeps healthcare.” The survey finds the following:

• The public is wary of new entrants in health insurance. Only one in 10 consumers say they are very likely to buy insurance from a new start-up, and only 15% are very likely to purchase a health plan run by a hospital or health system. Twenty-seven percent of employees have a strong preference to have a choice of three to five health plans while 14%  have a strong preference to be offered a single plan.
• More large employers are using private exchanges. This trend is likely to grow in 2014 as employers explore strategies to hold down costs, shed administrative burdens, and expand plan choices.
• Cost-conscious employers are making transparency a top factor in their negotiations with health plans and providers. Earlier this year, CMS released a trove of hospital pricing data for the first time, showing significant cost variability. Price-sensitive consumers are distinguishing high-quality care from high-cost care. Sixty-five percent of consumers say that expensive medical treatment doesn’t necessarily mean better quality care.
• Providers and consumers are increasingly adopting mobile health technologies; more than one-quarter of consumers use mobile apps to schedule healthcare appointments, up from 16% a year ago.
• States are struggling to contain rising Medicaid costs while an aging Baby Boom population has not saved enough for health costs in retirement. Demographic and economic trends point toward many years of rising long-term care costs. States are looking to managed care to help hold the line on long-term care spending. Ten years ago, only eight states had a Medicaid managed long-term care program; in 2014, that number is expected to climb to 26.
• Instead of just prescribing drugs, providers are prescribing exercise regimens and using data to help keep patients on track to meet health goals. In 2014, the trend could fundamentally alter how health organizations deliver care while keeping costs down. For the full report, visitwww.pwc.com/us/tophealthissues.

Last Updated 11/18/2020

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