1 / 43

Healthcare Trends Insights for Resilience

Healthcare Trends Insights for Resilience. 2019 Edition. Healthcare cost and payment. TREND 1. National healthcare expenditures continue to exceed general inflation. U.S. healthcare spending is $3.5 trillion; 17.9% of GDP, dwarfing other developed countries.

rolf
Download Presentation

Healthcare Trends Insights for Resilience

An Image/Link below is provided (as is) to download presentation Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author. Content is provided to you AS IS for your information and personal use only. Download presentation by click this link. While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server. During download, if you can't get a presentation, the file might be deleted by the publisher.

E N D

Presentation Transcript

  1. Healthcare TrendsInsights for Resilience 2019 Edition

  2. Healthcare cost and payment TREND 1 National healthcare expenditures continue to exceed general inflation. • U.S. healthcare spending is $3.5 trillion; 17.9% of GDP, dwarfing other developed countries. • Increases in U.S. health spending are consistently about 4x greater than general inflation.

  3. Healthcare cost and payment TREND 1 National healthcare expenditures continue to exceed general inflation. HEALTH CONSUMPTION EXPENDITURES AS A PERCENT OF GDP, 1970-2015 Graphic from: https://www.healthsystemtracker.org/indicator/spending/health-expenditure-gdp/

  4. The population is aging and becoming more diverse. Healthcare cost and payment TREND 2 • The population age 65+ will balloon to 73.1 million in the next 10 years, comprising 21% of the nation’s population; the trend in NYS is similar. • Providing healthcare to the elderly is 5x more expensive than kids and 3x more expensive than adults. • There is growing racial and ethnic pluralism in the U.S. and NYS, with the most notable changes among children.

  5. The population is aging and becoming more diverse. Healthcare cost and payment TREND 2 AGING POPULATION Graphic from: https://www.census.gov/content/dam/Census/library/publications/2018/demo/P25_1144.pdf

  6. The population is aging and becoming more diverse. Healthcare cost and payment TREND 2 CHANGING POPULATION Graphic from: https://www.census.gov/content/dam/Census/library/publications/2018/demo/P25_1144.pdf

  7. Healthcare cost and payment TREND 3 Long-term care costs put Medicaid fiscal stability at risk. • 63% of the Medicaid spend in NYS is directed to the aged and disabled. • NYS’ average Medicaid spend for the aged is about 60% higher than the nation; 50% higher for the disabled. • NYS’ Medicaid program could see an enrollment increase of more than 290,000 people age 65 and older by 2030. • More than 70% of nursing home residents in NYS are insured through Medicaid.

  8. Long-term care costs put Medicaid fiscal stability at risk. Healthcare cost and payment TREND 3 NYS MEDICAID ENROLLEES AND EXPENDITURES Graphic from: https://www.healthsystemtracker.org/indicator/spending/health-expenditure-gdp/

  9. The increasing federal debt threatens healthcare funding; NYS faces comparable budget challenges. Healthcare cost and payment TREND 4 • Budget deficits are expected to drive federal debt held by the public from 78% of GDP in 2019 to 144% of GDP by 2049. • About 70% of federal spending is mandatory. • To manage federal debts and deficits, federal spending across the board, including healthcare, may be at great risk. • States face comparable budget challenges. With 48% of NYS’ budget targeted toward healthcare and education, lawmakers will no doubt look to these sectors for relief.

  10. The increasing federal debt threatens healthcare funding; NYS faces comparable budget challenges. Healthcare cost and payment TREND 4 FEDERAL DEPT HELD BY THE PUBLIC SINCE 1790 Graphic from: https://www.cbo.gov/system/files/2019-06/55331-LTBO-2.pdf

  11. Medicare and Medicaid payment rates are not keeping pace with provider costs. Healthcare cost and payment TREND 5 • 70% of inpatient hospital discharges in NYS are paid for by Medicare or Medicaid. • 63% of hospital outpatient visits in NYS are paid for by Medicare or Medicaid. • In NYS, a high Medicare and Medicaid patient mix and associated underpayments are leading indicators of distressed hospital status.

  12. Medicare and Medicaid payment rates are not keeping pace with provider costs. Healthcare cost and payment TREND 5 In NYS, Medicare pays 93 cents on the dollar.

  13. Medicare and Medicaid payment rates are not keeping pace with provider costs. Healthcare cost and payment TREND 5 In NYS, Medicaid pays 73 cents on the dollar.

  14. The gap in providers’ fiscal health continues to grow. Healthcare cost and payment TREND 6 • The average operating margin for NYS hospitals and health systems has increased, driven by the financial performance of higher-revenue institutions; however, the median operating margin has declined. • This margin difference is an indicator of the gap in fiscal health between providers that has grown over time. • The gap is clear when comparing volume and revenue trends between NYS’ distressed hospitals and the state’s top 15 grossing hospitals; payer mix is also a leading factor in fiscal results between the two groups.

  15. The gap in providers’ fiscal health continues to grow. Healthcare cost and payment TREND 6 +2% Outpatient Volume Trend Inpatient Volume Trend -20% +74% +0% Revenue Trend +71% +0%

  16. APMs and VBP are leading tools to reform care delivery and reimbursement. Healthcare cost and payment TREND 7 • The net number of ACOs and lives managed by ACOs continues to increase. • Despite mixed results, Medicare alternative payment models continue and are trending as voluntary, with participants required to take on two-sided financial risk sooner. • NYS continues to trend toward its Medicaid value-based payment goals, with 63% of spending currently tied to such models (the goal is 80%); most activity is in one-sided risk models.

  17. APMs and VBP are leading tools to reform care delivery and reimbursement. Healthcare cost and payment TREND 7 PERCENTAGE OF POPULATION IN AN ACO BY HOSPITAL REFERRAL REGION Graphic from: https://www.healthaffairs.org/do/10.1377/hblog20180810.481968/full/

  18. The cost of health insurance premiums continues to grow. Access to care and insurance coverage TREND 1 • For workers, the average family premium is about $20,000 annually, a 47% increase over the last decade; for seniors, the Medicare Part B premium has increased by 40% in the last ten years. • HDHPs are used by 29% of workers; premium growth for these plans (68% over the last decade) is higher than traditional plans.

  19. The cost of health insurance premiums continues to grow. Access to care and insurance coverage TREND 1 EMPLOYER AND WORKER CONTRIBUTIONS TO PREMIUMS FOR FAMILY COVERAGE Graphic from: https://www.kff.org/report-section/2018-employer-health-benefits-survey-section-6-worker-and-employer-contributions-for-premiums/

  20. Out-of-pocket healthcare costs continue to rise. Access to care and insurance coverage TREND 2 • Out-of-pocket cost sharing, consisting of deductibles, copays and coinsurance, increased 54% from 2006 to 2016. • The rise in deductible costs is a major factor in health insurance affordability and care outcomes for consumers. • Wage growth is not keeping pace, up 29% over the last decade.

  21. Out-of-pocket healthcare costs continue to rise. Access to care and insurance coverage TREND 2 Deductibles +176% CHANGES IN CONSUMER OUT-OF-POCKET SPENDING Coinsurance +67% Copays -38% Graphic: Adapted from https://www.healthsystemtracker.org/brief/increases-in-cost-sharing-payments-have-far-outpaced-wage-growth/#

  22. Public and private initiatives are calling for price transparency. Access to care and insurance coverage TREND 3 • In June 2019 President Trump issued an executive order that demands hospitals make privately negotiated price information public; the consequences of this order will emerge in the near future. • Despite lack of evidence that making price data available helps consumer decision-making or lowers overall healthcare costs, 65% of consumers report that pricing transparency before healthcare services are provided is a factor in determining satisfaction. • Countless and disparate public and private price transparency initiatives could be displaced based on how the president’s executive order is ultimately implemented.

  23. Public and private initiatives are calling for price transparency. Access to care and insurance coverage TREND 3 TRUMP SIGNS EXECUTIVE ORDER REQUIRING HOSPITALS TO DISCLOSE PRICES TO PATIENTS Graphic from: https://ktla.com/2019/06/24/trump-to-issue-executive-order-requiring-hospitals-to-disclose-prices-to-patients/

  24. Single payer, other coverage expansion ideas gain traction in quest for access and affordability. Access to care and insurance coverage TREND 4 • Single payer and other coverage ideas are gaining traction in the face of the growing number of uninsured and persistent healthcare cost increases. • Generally, single payer models would provide medical coverage to all, replace premiums with new business and individual tax levies. These models seek to reduce costs by controlling payment rates to providers, decreasing administrative expenses and using government leverage to limit other major healthcare spending, such as pharmaceutical spending. • There are 10 proposals in Congress that would establish a single-payer system or push the U.S. toward a single-payer system. In New York state, the New York Health Act has passed the Assembly consistently but has yet to receive consideration by the state Senate.

  25. Single payer, other coverage expansion ideas gain traction in quest for access and affordability. Access to care and insurance coverage TREND 4 HEALTH CONSUMPTION EXPENDITURES AS A PERCENT OF GDP, 1970-2015 Graphic from: https://www.healthsystemtracker.org/indicator/spending/health-expenditure-gdp/

  26. Single payer, other coverage expansion ideas gain traction in quest for access and affordability. Access to care and insurance coverage TREND 4 PERCENTAGE OF U.S. ADULTS WITHOUT HEALTH INSURANCE, 2008-2018 Graphic from: https://news.gallup.com/poll/246134/uninsured-rate-rises-four-year-high.aspx

  27. Technology and consumerism TREND 1 Major tech firms are expanding their footprint in the healthcare marketplace. • Tech giants all hold HIPAA-enabled clouds + wrap-around services, including analytics for the provision of care (AI and machine learning). • These firms carry enormous financial capabilities and consumer loyalty that create a new and powerful force for disruption. • Voice is an advancing trend in healthcare that has the capacity to improve patient outcomes and provider efficiency.,

  28. Technology and consumerism TREND 1 Major tech firms are expanding their footprint in the healthcare marketplace. TECH FIRMS

  29. Technology and consumerism TREND 2 Digital technologies expand as hospitals and health systems define where to engage. • The number of digital health mergers and acquisitions hit 56 in 2018 — focused on telemedicine, remote patient monitoring, pharmacy, patient engagement and chronic disease management, among others. • Digital and mobile engagement continues to increase across the age spectrum: 53% of adults in the U.S. own smartphones, up from 18% in 2013; effectively, all in the 18 to 29 age group own a smartphone. • Data from existing and new sources will advance AI/machine learning with the AI market expected to grow to $36.1 billion by 2025 (from $2.1 billion currently).

  30. Technology and consumerism TREND 2 Digital technologies expand as hospitals and health systems define where to engage. DIGITAL HEALTH MERGERS Graphic from: https://medicalfuturist.com/digital-health-mergers-and-acquisitions-2018

  31. Technology and consumerism TREND 2 Digital technologies expand as hospitals and health systems define where to engage. CONSUMER PREFERENCE FOR DIGITAL INTERACTIONS Graphic from: https://www.accenture.com/us-en/insights/health/todays-consumers-reveal-future-healthcare

  32. Technology and consumerism TREND 3 Consumer preference drives a rise in telemedicine and urgent, retail and direct primary care. • Healthcare consumers in search of convenience and affordability, along with generational shifts, are changing the “front door” of healthcare. • 84% of baby boomers report a relationship with a primary care physician, with 67% of millennials/55% of Gen Z reporting a relationship. • Telehealth has seen a spike in usage, but still makes up less than 1% of outpatient visits.

  33. Technology and consumerism TREND 3 Consumer preference drives a rise in telemedicine and urgent, retail and direct primary care. “FRONT DOOR” TRENDS FOR LOW-ACUITY SERVICES Graphic from: ADD FRONT DOOR LINK WHEN POSTED

  34. Technology and consumerism TREND 4 Interventions to address social determinants of health are moving into care delivery models. • The provision of medical care makes up only about 20% of a person’s health; the 80% balance is determined by underlying social, physical and behavioral factors. • Addressing social determinants of health is a priority in Albany and Washington. The federal government is developing CMMI initiatives related to food and housing; New York’s supportive housing program has shown positive results and the state created a Bureau of Social Determinants of Health.

  35. Technology and consumerism TREND 4 Interventions to address social determinants of health are moving into care delivery models. Graphic from: https://hungerandhealth.feedingamerica.org/explore-our-work/community-health-care-partnerships/

  36. Market shifts TREND 1 Vertical integration continues to shift the healthcare landscape. • Payers and retail pharmacies are leading vertical integration deals to control or influence patient encounter points across the continuum of care delivery. • Combined, five insurers (Aetna, Anthem, Cigna, Humana and United) manage 51% of covered lives in the U.S. • In Feb. 2019, CVS opened its first three integrated HealthHUB stores in Houston, with more floor space dedicated to healthcare services.

  37. Market shifts TREND 1 Vertical integration continues to shift the healthcare landscape. Graphic from: https://www.hanys.org/communications/publications/healthcare_intelligence_reports/docs/2019-03_vertical_integration_report.pdf

  38. Market shifts TREND 2 Horizontal integration continues to consolidate the provider landscape. • There were about 400 hospital transactions across the country during the last five years. • Nearly 85% of hospitals in NYS have some form of affiliation. • Cross-border affiliations in NYS have grown in recent years.

  39. Market shifts TREND 3 Payers are increasingly squeezing providers through denials for payment and other tactics. • Hospitals in NYS report an initial claims denial rate of about 10%; comparable to the nation. • Hospitals are also experiencing a rise in denials and in pre- and post-payment audits, new authorization and utilization rules and unilateral policies impacting patient steerage away from hospital-based services. • Setting prices using a common reference point is also gaining traction as a means for payers to reduce their costs.

  40. Market shifts TREND 3 Payers are increasingly squeezing providers through denials for payment and other tactics. Graphic from: https://www.ezdi.com/blog/claim-denials-guide-for-him-professionals-coding-staff/

  41. Market shifts TREND 4 The healthcare workforce is adjusting to consumer and worker needs. • Healthcare is the largest source of jobs in the U.S. — a sector that has proven to be recession-resistant and currently supports nearly 17 million workers nationally. • As healthcare delivery models change, several non-traditional workforce roles have developed — patient navigators, ride sharing services, etc. • Personal care aides, home health aides and advance practice clinicians are the fastest-growing healthcare occupations.

  42. Market shifts TREND 4 The healthcare workforce is adjusting to consumer and worker needs. Retail Trade Manufacturing Healthcare Graphic from: https://fred.stlouisfed.org/series/PAYEMS

  43. Healthcare TrendsInsights for Resilience 2019 Edition

More Related