5 ways the health industry could be upended, Navigant director says

Industries can be turned upside-down in an instant. It happened when Amazon and eBay transformed traditional retailing, and again when Netflix toppled Blockbuster's dominance for watching movies. The healthcare industry is not immune to this kind of disruption. Paul Keckley, Managing Director of the Navigant Center for Healthcare Research and Policy Analysis, has identified five areas in healthcare that are susceptible to dramatic change: drug costs, rural hospitals, academic medical centers, private insurers and physicians.

Advance to the next slide to see Keckley's analysis of the potential for change in these five areas.

"Drug costs are soaring," said Keckley. "The entire issue of value in healthcare is under reexamination." Someone may find a path to quicker access and lower costs, he said; legal importation is a possibility, as is direct-to-consumer sales by manufacturers, which would cut out layers of drug costs from hospital bills and insurance premiums.

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Rural hospitals are at the forefront of community health and primary care, but Keckley says they're ill-equipped to compete, due primarily to lower volumes and the hefty costs of technology and training. He speculates that rural hospitals may morph into modern primary care hubs, using digital telehealth to virtually bring acute services to communities.

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"As Medicare's Next Generation ACO model is implemented, some provider organizations will sponsor their own Medicare Advantage plan with other plans focused on Medicare and commercial populations," said Keckley. Both employers and consumers are receptive to provider-sponsored plans, which means independent insurers are vulnerable to a changing landscape.

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Keckley claims that consumers want engaged physicians to be accessible online. They want to be seen for necessary appointments, and given alternatives to those that aren't. They also want predictable, understandable prices and information about the performance of their physicians. "And they're open to changing physicians, using a retail clinic, pharmacist or nurse as their primary care provider and diagnostic technologies for self-diagnosis," he said. That means the practice of medicine is primed for an overhaul.