They say change is the only constant in life. As we wrap up 2016, this phrase has never felt truer. And heading into 2017, more change is on the horizon – particularly with a new administration looking to make significant changes – for the life sciences and health care industry broadly, and more specifically for health care providers. A number of trends including value-based care, MACRA, and increased industry consolidation will continue to change and transform our industry in the coming year. While change and transformation can be uncomfortable, I look forward to 2017 with optimism for where our industry is headed. One particularly exciting direction is the move towards a more consumer-centric health care system, driven by innovation and technology.
Imagine a single mom whose fifth-grader returns from school suffering from asthma. Unable to take off from work, she relies on the boy’s inhaler for temporary relief. Two days later, his condition worsens, she brings him to the doctor who spends five minutes with the patient, has him breathe into a tube, and sends him off with a prescription. Meanwhile, his mother has lost a day’s work.
Now imagine the mother has an iPhone or Android, with a small blow tube connected by Bluetooth to his health care provider. Test results are collected and transmitted digitally to the doctor or hospital. There’s no drop-off in care, but the process is faster, more flexible, and convenient – and doesn’t require the mother to take off work or spend time in a waiting room.
The promise of telehealth illustrates an inescapable truth about our health care system: with each year, it is gravitating increasingly toward what the consumer needs and increasingly expects. Health care consumers are moving inexorably to the center of the system, driving how care is provided and financed. It used to be that what was most convenient for the doctor was what defined the doctor-patient relationship. Now consumers are determining what matters and how personal health is managed.
Increasingly, consumers expect a high-quality retail experience from their health care providers, akin to what they receive from banking apps and online shopping for consumer goods. Today, the educated consumer seeks convenience and quality outcomes from their providers. And, when it comes to technology, there’s no shortage of devices – to wear, stick on a desk, and even swallow and implant – that enable consumers to take a power position when it comes to their own health.
As we move into 2017, the promise of these types of innovations and new technologies is game-changing. Technology can help consumers improve their own health, potentially reducing hospital admissions and emphasizing prevention that can help keep costs under control. Investments in analytics, sophisticated data systems, and other technology are essential to creating a new, consumer-driven system.
While the industry is abuzz with excitement around technology and data analytics, the $64,000 question remains: who pays for it all? Consumers don’t want to foot the bill, and providers – facing smaller reimbursements, escalating costs, and increasing market pressures – are between a rock and hard place on coming up with needed capital investment.
There’s also a great deal of uncertainty as we head into the New Year, potentially causing providers to shift their focus from investment to compliance. While MACRA seeks to reduce costs, and ultimately promotes technology, many physicians feel uncertainty around what the law means. Further, and maybe most impactful, is the uncertainty around the future of the Affordable Care Act (ACA). With a new administration looking to make major changes to the future of our health care system, providers may restrain from investments until they have a clearer picture into what the ACA will look like.
Some difficult challenges and uncertainties are ahead for providers in 2017. Providers are hunkering down, working to sustain themselves during a time of increasing consolidation, economic, and regulatory pressures. But we are starting to move in the right direction with consumer centricity and value-based care, where health systems can begin to encourage investments in innovative technologies and reward providers for keeping their communities healthy. For those parents with sick children, who need convenient and high-quality care on their own terms, technology and innovation will mean the world of difference. While the outlook for 2017 may be a bit cloudy, we’re optimistic that the industry is on a path toward transformative, positive change.
Visit our complete set of 2017 Outlooks to learn about trends impacting the entire US and global life sciences and health care industry.