There are three trends that emerged in 2015 that are likely to prove costly in 2016.
1. Physician awareness of MACRA. The Medicare Access and CHIP Reauthorization Act was enacted in 2015 to replace the flawed sustainable growth rate. Under MACRA, performance measurements for new payment models begin in 2017, which makes it vital that physicians begin learning about the implications of MACRA for their practices in 2016.
According to a recent Health Affairs blog post by Susan DeVore, president and CEO of Premier, Inc., it is critical physicians learn how to improve performance and avoid payment penalties under MACRA. This will entail "developing more complex governance models, adjusting to more data sharing across the care continuum and more performance measurement," according to Ms. DeVore. Physician practices will also need to conduct financial planning to choose payment models that best fit their current performance and organize themselves to take advantage of their payment model choice.
Preparing and complying with MACRA will be a difficult and expensive task, which may cause an uptick in physicians joining or affiliating with health systems. MACRA may also cause an increase in early retirements among physicians who are opposed to the changes.
2. Rising prescription drug prices. Spending growth on prescription drugs has emerged as a primary concern for healthcare providers and consumers alike as growth rates continue to surge. Overall drug prices jumped an alarming 12.2 percent last year, which marked the highest rate of increase in more than 10 years. Prescription drug spending represented 9.8 percent of overall health spending in 2014 and is projected to hit 10.1 percent in 2015 and 10.4 percent by 2024, according to a report by the Peterson Center on Healthcare and the Kaiser Family Foundation.
With the cost of both specialty and generic pharmaceutical drugs on the rise, drug prices will continue to represent a major financial challenge for healthcare organizations in the year ahead. To help reign in drug prices, there will likely be an increased focus on driving market competition in 2016, according to Ms. DeVore. "We anticipate the new FDA Commissioner will prioritize speed and market access of new drug approvals," she wrote. "Shortening waiting lists as well as the lengthy approval process will go far to unleash positive competitive forces in the market, and drive prices down."
3. Lack of payment incentives for telemedicine. Although it has been lauded as an innovative way to manage patient care, growth in telemedicine use has been hindered by a payment incentive problem. Medicare and many private insurers do not pay for telemedicine outside of rural areas with a shortage of providers.
Investing in telemedicine without reimbursement for implementation is a costly endeavor, but the investment can pay off, especially if a healthcare provider participates in alternative payment models. For instance, Phoenix-based Banner Health was able to reduce hospitalizations and long-term care stays by giving tablet computers to its highest-cost chronic care patients, who use health apps and remote monitoring tools to record their daily vitals, according to the report.
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