Although providers who are not yet involved in value-based contracts are seeking out payers that are experimenting with new payment models, merely entering risk-based arrangements are not sufficient for healthcare organizations to keep pace with the dramatic transformation the industry is about to go through.
That’s the contention of Jon Souder, director of health industries advisory at PwC.
“Looking at different payment models and continuing to operate in a business-to-business environment will not be enough. And the folks who don’t adapt from that will be the losers in the new health economy,” said Souder. “It’s much more than the evolutionary change that we’ve historically seen.”
Speaking at Health Data Management’s value-based care conference in Dallas on Wednesday, Souder warned that the healthcare is headed for a “seismic change” as the industry transitions from traditional fee-for service that rewards the quantity of services to one that rewards the quality of outcomes.
According to Souder, true value in this new healthcare business environment is created only when partnerships extend beyond traditional health players.
“What if you could get, in any given community, retailers, telecoms, doctors and grocery stores all to work together?” he asked.
Shannon Smith, director at PwC, added that healthcare traditionally has operated as a “business-to-business system of silos connected by contracts.” However, she said the “demand for value is really permeating every aspect of the industry, and it’s bringing about a more innovative and collaborative ecosystem, centered around serving the consumer.”
The rise of consumerism, as well as digitization and technological advances coupled with decentralization, are the main forces shaping the new health ecosystem, according to Souder.
“Some impacts will grow the size of the pie, and others will shrink it,” he said. “We’re going to see a lot of impacts that are going to take some money out of this person’s pocket and put it in someone else’s pocket.”
Souder sees this dramatic change occurring across all healthcare sectors between 2016 and 2025. As reimbursement increasingly focuses on value, health systems will pursue lower-cost settings more aggressively than before, while employing innovative approaches to distributing care.
When it comes to technology, he believes remote monitoring, telemedicine and mobile health will serve as “low-velocity growth producers” and “inflators” for the new healthcare economy.
According to a PwC report, in 2016 millions of American consumers will have their first video consults, be prescribed their first health apps and use their smartphones as diagnostic tools for the first time. Thanks to mobile healthcare technology and shifts in financial incentives, care will begin to move into the palms of consumers’ hands, providing care anywhere and anytime, argues the firm.
Further, as the health system moves away from fee-for-service reimbursement, clinicians are leveraging virtual medicine to support population health initiatives and expand telehealth services in such areas as behavioral health. PwC says employers are embracing connected tools to engage employees in wellness programs and chronic disease management, while health plans are using the same to reduce spending.”
In addition, Souder concluded that other technologies such as machine learning, artificial intelligence, and 3D printing will emerge as platforms for change and efficiency.
Register or login for access to this item and much more
All Health Data Management content is archived after seven days.
Community members receive:
- All recent and archived articles
- Conference offers and updates
- A full menu of enewsletter options
- Web seminars, white papers, ebooks
Already have an account? Log In
Don't have an account? Register for Free Unlimited Access