Post healthcare reform market landscape

Post-Healthcare Reform Market Landscape October 2013 BLOG POST

Overview The US healthcare system is undergoing a sea change under the Accountable Care Act (ACA). Highquality and low-cost healthcare solutions which is a major milestone of the healthcare reform requires change in business models for payors and providers, greater patient involvement and an array of innovative products and services offered by other stakeholders in the healthcare industry. The demand thus generated by the healthcare reform has its share of opportunities and challenges.

Key Areas to Focus on Post-Healthcare Reform1 New health exchanges – Health insurance exchanges have the potential to create a more organized and competitive market for purchasing healthcare coverage, leading to price moderation, that are currently growing out of control and would lead to more personalized plans that offer better solutions to consumer needs. Payors need to invest in software and services to fuel these exchanges, such as shopping transparency programs and call center technologies. Both public and private exchange operators will need to build high-efficiency platforms that include shopping software and back‐end administrative technology and services required to serve millions of people efficiently. In the post‐reform era, a greater need for educational tools and easy translation of medical and insurance information will be required to help consumers make better decisions and manage their recently discovered clinical and financial accountability.

Consumer-focused health plan innovation – Millions of US citizens will be buying healthcare coverage for the first time. They will indulge in getting the best deals as offered in any other consumer products offering, which have high-value and low-cost. This new phenomenon will drive innovation in the way payors offer health plans. Payors need to own consumer-focused brands and create a strong consumer brand by introducing consumer-friendly interfaces and tools, as they would be selling directly to consumers via the health insurance exchanges.

Eliminating wasteful usage in the healthcare delivery system – The healthcare reform is forcing healthcare providers with value-based reimbursements and requires them to be financially accountable for patient outcomes. Hence, providers need to eliminate wasteful use of healthcare services.

Modernization of the care delivery system that will facilitate better cost management is inevitable for providers in order to stay in business. Use of healthcare technology like electronic health records (EHRs) and health information exchanges, to generate and share information for better care co-ordination will help providers to drive out wasteful usages.

Leveraging Analytics in healthcare information2 – The healthcare marketplace is shifting towards individual members and will a greater need to understand consumers and their health records and healthcare choices. Providers have spent large amounts of money for implementing EHR systems and 1 2

Psilos Group: The Future of Healthcare – Investing in a Post‐Reform World Electronic Health Reporter

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have demonstrated meaningful use, to qualify for incentives. What do they do with the huge amount of healthcare information thus generated? On the other hand, payors are analyzing their member populations and their provider networks at a macro level to identify trends which will help them address the issue of increasing healthcare costs. Healthcare analytics and informatics with the help of new tools and risk-scoring models are required to offer solutions to providers and payors effectively.

Bottom line The post-reform healthcare market in the US will witness an evolved Payor, Provider and Patient (PPP) model. Payors will be required to function in a more competitive environment with better provider network management and high level of consumer interaction. Providers need to manage care delivery results and costs more efficiently with greater focus on patient health and better understanding of payor requirements. Other stakeholders in the healthcare industry like information technology and analytics service providers will play a central role in developing and maintaining the newfound relationship between payors, providers and patients.

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