Topics
More on Operations

4 hot healthcare topics for 2015: Tech, M&A, health exchanges, reimbursement

The top issues aren't all that different from last year, but the terms continue to evolve.

David Weldon, Contributor

When it comes to the new year in healthcare, 2015 is starting to look a lot like "Déjà vu all over again."

When it comes to the new year in healthcare, 2015 is starting to look a lot like "Déjà vu all over again."

When Healthcare Finance last year asked healthcare experts to name the top trends that would impact 2014, they selected insurance exchanges, mergers and acquisitions, new payment models, and technology. This year, it’s exactly the same.

To get a better sense of it of what it all means on the finance side of things, we asked three healthcare authorities for their views on the four topics: Tom Baldosaro, CFO at South Jersey Healthcare Regional Medical Center in Vineland, New Jersey; Debbie Ridlen, CFO at Schneck Medical Center in Seymour, Indiana; and Dean Stephens, CEO at Healthline, a leading provider of intelligent health information solutions.

Insurance exchanges

Among the biggest questions around insurance exchanges heading into 2014: How many newly insured will there be? Would health plans be more or less expensive? And would enrollment be more or less complicated?

There’s good and bad news on those fronts.

[ALSO: 10 healthcare issues to watch in 2015]

“Insurance exchanges are increasingly turning the insurance industry into a consumer-oriented industry, forcing payer organizations to learn how to sell to this new consumer audience,” said Stephens. “For many consumers, the exchanges give them an opportunity to have health insurance for the first time.”

Still, many healthcare organizations did not see exchange patients in the large numbers expected in 2014.

“We did not expect much of an impact,” said Baldosaro. “We really didn’t think that for people that did go on the exchange plan that they’d get much benefit from it because of the large deductibles. It would take them multiple trips to our facility before insurance would kick in, so there really was no difference.”

It’s a similar tale at Schneck Medical Center, according to Ridlen. “Last year, in our local market, we didn’t see a large number of exchange plans being offered,” she said. But that may change in 2015, as many small employers decide to no longer provide insurance coverage. The hospital is keeping watch in that likelihood, since it is not receiving the same reimbursement rate as with its other managed care contracts.

Mergers and acquisitions

South Jersey Health Regional Medical Center was involved in a merger in 2012, and Baldosaro said he expects to see many more in 2015. It’s all a numbers game now – each healthcare organization trying to increase its patient base. “Big is going to be better. Small is not going to survive,” he said.

Ridlen hopes that Baldosaro is wrong. Schneck Medical has so far been able to maintain its independence, though the challenge gets tougher each year. “We haven’t merged. Our philosophy has always been to maintain our independence just so that care is delivered locally.”

But Stephens cautions that independent healthcare organizations are now bucking a growing national trend, not just among hospitals, but also among solutions providers.

“In 2015, the number of EHR players in the healthcare market will shrink. We will see come consolidation between the various EHR companies, but broader healthcare IT companies will begin to buy up smaller EHR companies to gain access to patient data. I also expect to see a good deal of M&A activity in healthcare content – smaller consumer health websites will find themselves looking for a new home.”

New payment models

Healthcare experts predicted that 2014 would see sustained growth in reimbursement models, including accountable care, bundled payments, and shared savings.

Building on that momentum, the coming year will represent the “measurement stage” of the shared savings program, according to Stephens. Healthcare organizations will “begin to digest the outcomes data from initial ACO programs,” and “there will be a collective realization that it will take more to drive significant medical and financial results,” he said.

That is happening at Schneck Medical Center. “We are working on developing an integrated health network so that we can work with our local insurance providers to offer a shared savings type program that we can market to employers,” Ridlen said, adding that the hospital has spent much of 2014 developing the program, and hopes to go live with it in 2015.

But the journey is not an easy one for most organizations. According to Baldosaro, “all of the players we’ve talked to say they have an interest in getting to that point … but they’re not there today, and I’m not sure who is doing it well. Nobody I’ve talked with is. To me, the transition in payment models is starting – and you might see some areas that are bundled – but I think we’re still a ways away.”

Technology

The healthcare industry is one of the greatest users of technology, and that will continue in 2015 – both in terms of information technology and clinical technology.

“Big data will continue to be a shining star,” Stephens said. “Providers and payers will establish strategic plans around how to leverage all this information to avoid unnecessary costs and improve outcomes. Increasing focus will be placed on unstructured content, such as physician notes on the patient, case manager notes, and admission and discharge notes. This will give the healthcare industry an opportunity to use predictive analytics on a bigger scale.”

For Schneck Medical Center, the biggest challenge with technology is knowing when to invest and what to invest in. “We try to make sure we are on the cutting edge of technology,” Ridlen said. “One challenge we have is how quickly to embrace new technologies versus making sure what is proven.”

The integrated health network at Schneck Medical is enabling healthcare providers to collect data both at the hospital and from multiple providers in the community.

“Whoever the patient sees will have access into the record and information sharing, and will ultimately deliver better care as a result,” Ridlen said. “That’s something we have made a priority, and we will be rolling that out in the first quarter.”

For Baldosaro, the next step in technology transformation would be a new level of virtual care, in which “people can just use their technology, and not even have to physically go to a hospital or doctor.”

That is still far off. Still, Baldosaro said. Payment mechanisms need to be worked out, and collaboration strategies need to be created.

“But you need to start the investment if we’re going to get there, and that’s the hardest thing,” Baldosaro said. “We’re trying to do something new. It’s never been done, and there’s no blueprint.”

“You’re thinking more now about where you have to get to, than where you are,” Baldosaro said. “That is such a unique thing. The degree to which it is changing today is a lot more rapid than it has been in the past. It makes for a lot of thought-provoking ideas, and then the execution behind it is what is important.”