The Affordable Care Act is Driving Businesses to Take Action on Healthcare Costs
The opportunity is now for healthcare providers to come to the table with creative solutions that drive wellness up and healthcare costs down
Love it or hate it, the Affordable Care Act (ACA) (aka Obamacare) is the U.S. healthcare industry’s new rule book. In particular, the law is requiring a massive overhaul in how businesses approach healthcare. Most importantly, because of the way the ACA is written, US businesses are on the hook for paying the bulk of the US’s out of control healthcare spending.
Everyone knows the money problem. The United States’ investment in healthcare is dramatically higher than every other developed nation. However, by just about every meaningful measure, our population is less healthy. This means that our country is getting very poor value for each dollar invested in the US healthcare system. Because of the ACA, more than ever before, US businesses care about getting value for money. This disparity creates the perfect conditions for proactive and creative healthcare organizations to engage businesses in a meaningful way and develop solutions that will both drive substantial improvements in employee health while also reducing overall healthcare expenses.
Shifting Costs, Shifting Responsibilities
Cost reallocation is happening between employees and employers like never before. The ACA states that medium and large employers [any business with an average of 50 or more full time equivalents] must offer employees health plans. However, those plan premiums must be capped at 9.5% of their W-2 wages[i] and have an out-of-pocket maximum set at $6,600[ii]. As a result, any cost above the employee’s cap limit must be covered by the employer. With US healthcare costs approaching 1/5th of GDP,[iii] business profits and employee take-home pay are being steadily eroded while US citizens are becoming less and less healthy.
With businesses now shouldering these rising healthcare costs, they are eagerly pursuing ways to change the dynamics in the US healthcare industry.
Stopping the Spiral
An opportunity has arisen for a new type of alliance between healthcare providers and businesses to creatively redraft the way healthcare is delivered in the US. This is a partnership predicated on the shared responsibility of drawing down per capita healthcare spending while driving up core wellness metrics. Proactive healthcare organizations will be successful by working with employers and employees to reverse the 35 year trend of rising healthcare costs. This can be done through implementing contracts that tie performance bonuses, not to transactions, but by measuring the cost avoidance that is created through population wellness initiatives.
How Will Healthcare Providers Help solve the Problem?
This sea of change represents an opportunity for providers to reorient their practices in a way that aligns their efforts with the reasons why many providers went into healthcare in the first place: to help people live healthier and more productive lives.
Where should you start? We recommend getting engaged with the employers that now, more than ever before, share your passion for wellness. Start by getting involved with business groups such as the DFW Business Group on Health (DFWBGH), the Texas Business Group on Health (TBGH) or the National Business Coalition on Health (NBCH) that are right now focused on developing creative health and wellness programs for employees. These business groups are helping employers implement healthcare plans that focus on cost containment through investing in employee wellness initiatives.
Ways to Create a Healthier Healthcare System
A reimagined healthcare industry will take on a variety of forms, but the overarching goal will be the same cost avoidance through preventative medicine and wellness programs. We at US Medical IT are passionate about how thoughtfully implementing technology that can help assist in the areas of convenience, wellness, prevention and proactive care.
Potential Wellness and Convenient Care Offerings
- Onsite clinics at large employer facilities
- Telemedicine for remote and rural employees
- Company wellness initiatives focused on smoking, eating and exercise
- Onsite and virtual educators, navigators and wellness coaches
- Consolidating and tracking metrics around meal tracking, fitness bands and weight
- Proactive screening for wellness indicators such as high blood pressure, high cholesterol & weight
Additional Areas Where You Can Support Employers
- Coordinate or offer narrow high performance networks with bundled payments for expensive but predictable conditions (i.e. cardiac and orthopedic procedures)
- Work with referral providers to reduce test duplication and increase cost transparency for both employers and employees
- Use tools like Precision Medicine to take the guess work out of prescription writing
- Help employers navigate the complex and expensive world of specialty drugs
Employers are now more than ever before empowered and motivated to use financial incentives to motivate employees to participate in your wellness offerings:
- Subsidized wellness programs
- 30% – 50% of premium for healthy living choices
- Health Savings Account
How can US Medical IT help?
Some of the ways we can help include:
- Constructing a HIPAA compliant extranets where providers and employers can collaborate.
- Building out a secure digital dashboards using Microsoft PowerBI that allows you to measure performance against a set of wellness metrics.
- Offering telemedicine based solutions that can extend your provider’s geography.
Want more information?
- Schedule a 20 minute meeting with me to see how US Medical IT might be able to help your organization.
- Find out how to become your organization’s Health IT Hero.
- You can also check out our HIPAA Compliance survival kit here.
About the Author
As President and CIO of US Medical IT, Stephen Cracknell has a vision to innovate the healthcare technology environment in order to improve medical practitioners’ daily operations and better service patients in a more compliant manner. Prior to launching US Medical IT in 2010, Stephen spent 12 years at Microsoft and had extensive experience managing complex IT projects ranging from security to databases and network architecture. In 2007, Bill Gates awarded Stephen Microsoft’s Innovation Award for his design of a Shelter Registration System used by the American Red Cross. Stephen earned his bachelor’s degree in Economics and Finance from the University of Guelph in Ontario, Canada.
Connect with Stephen on LinkedIn.
About US Medical IT
Our mission at US Medical IT is to thoughtfully integrate medicine and technology, creating the opportunity for broader knowledge distribution, better coordination of care, and ultimately the improved health and well-being of all. If you have questions about this topic, feel free to leave a comment or contact US Medical IT. Schedule an appointment with us to learn more about our secure cloud technology.