Five Changes in Five Years: How the ACA has Changed the Industry
07 Jul 2015

Five Changes in Five Years: How the ACA has Changed the Industry

2015 marks the fifth year of the Affordable Health Care Act. The healthcare reform law has drastically changed the climate for hospitals – and more changes are coming. Recently, PricewaterhouseCoopers released a report highlighting five major changes the law made in health care and how they’ll continue to shape hospitals’ decisions in the years to come.

1. Risk Shift

As healthcare executives know, one of the biggest changes created by healthcare reform is the shift from fee-for-service payments to value-based payment models, which means all healthcare providers now assume some of the risk if patients don’t stay healthy. Medicare recently announced that it’s working to make almost all payments contingent upon value, so this development will continue as time goes on.

Value-based care won’t only affect Medicare payments. The Centers for Medicare & Medicaid Services (CMS) has pledged to work with private payors for the next few years to make sure that value-based initiatives are expanded to include third-party carrier payments as well.

Hospitals’ payments have also been affected by Medicare’s program to penalize facilities for high readmission rates. With these cuts to reimbursement, hospitals must do what they can to avoid them by evaluating the care they provide and looking for ways to improve patient outcomes.

2. Primary Care

Because the ACA places its focus on keeping patients healthy, primary care has also become more important. Insurance plans cover various preventive services in hopes that patients won’t become sick in the first place. Other healthcare providers, including hospitals, have been encouraged to take this approach with their care, so the coordination of care has become more important. Through entities such as accountable care organizations (ACOs), hospitals are working closely with primary care physicians and other providers to keep patients healthy.

Many hospitals have already entered the foray of primary care by purchasing their own physician practices. But even facilities that haven’t taken that step will need to be aware of the primary care resources available in their area so they can make recommendations to patients.

3. New Tech and Vendors

Most hospitals have an electronic health records (EHR) vendor they work with to keep their medical records digitized due to new rules implemented with the ACA and other federal initiatives. Besides EHR vendors, ACA changes have created other new business partners for hospitals to work with, many of whom shape their business models around helping patients keep track of their own health indicators.

Funding from the ACA has enabled several start-up companies to create new health technology, including “digital pills” that track patients’ conditions, apps that help fight heart disease and diabetes, and wearable devices that monitor patients’ heart rates and sleep patterns. In addition, hospitals can work with telehealth providers to follow up with patients who may have difficulty traveling to appointments on their own after discharge.

Using the technology from these vendors, hospitals can transform care delivery and boost their quality. It will be easier for facilities to monitor patients and see if their conditions really are improving once they leave the hospital and clinicians can catch small issues before they turn into significant health problems.

4. Health Insurance

Naturally, the ACA has changed the face of health insurance. Aside from the fact that payors are now focusing more on value, the plans themselves are different than they were five years ago. The industry has become more of a business than ever, with patients encouraged to shop around and find the coverage that fits their needs. The variety of insurance plans have left billing staff in hospitals scrambling to keep up with what services are covered and how much patients are responsible for paying out of pocket.

And it’s only getting more complicated going forward. With the future of exchange plans up in the air pending a Supreme Court decision in King v. Burwell, changes could be even more dramatic.

But for now, expect to see patients with a variety of insurances – and to deal with their complaints if they find out their plans don’t cover as much as expected. Facilities must also be prepared to treat patients more like customers, listening to their preferences and appealing to their wallets by providing quality care at a reasonable cost.

5. State Regulations

When the ACA was first passed, states were given a large amount of leeway when it came to enforcing key points of the law, such as creating their own exchanges. This trend will continue going forward, and if King v. Burwell forbids the use of subsidies to purchase exchange plans, the landscape will shift even more. Hospitals may end up providing more charity care, depending on how their state decides to handle exchange plans after the court decision.

Since state laws regarding ACA coverage are constantly changing, hospitals have a chance to actually have an effect on the decisions lawmakers make. It may be a good idea to check with state medical associations or hospital associations to see if there are any specific lobbying outlets where you can make your voice heard on behalf of your facility’s needs.

The industry is always changing and will continue to change, so make sure you are up-to-date on your current events news. The Affordable Care Act impacts your daily work, and it’s important to stay current so that you can effectively advice your patients.

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