Healthcare innovation: Expect employers to lead the way in 2019

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If you have a TV, phone or Internet connection in 2018, you’re aware that the longstanding pastimes of political posturing and legal wrangling remained as popular as ever. Sometime after we get done arguing about the border wall, we’ll certainly find time to renew our battles over the Affordable Care Act and the future of our struggling, inefficient healthcare system.

But those headlines obscure an important and fortunate truth – we don’t actually need permission from Congress to fix things on our own.

In fact, a growing number of employers – fed up with the confusion and chaos, the increasing costs and uncertainty – are taking matters into their own hands. It’s a trend that began several years ago, and it gained momentum in 2018. More and more employers are dumping their complicated and expensive health plan designs and instead purchasing healthcare directly from providers. They’re getting out of their comfort zone, learning how the system works and how they can change it.

In the process, they’re taking control away from the legacy healthcare players – so they can offer their workers high value health plans that deliver better quality at lower costs.

Healthcare is just the latest major industry to be disrupted by innovators using new ideas and new technologies. So, it probably shouldn’t come as a surprise. But what may surprise you is the enthusiasm for change shown by the public sector. Typically, we think of privately held companies as more agile and open to innovation. But it turns out that school districts, universities, and city and county governments are leading the way, battling the status quo.

That makes sense when you consider the budget squeezes that public entities have faced in recent years, and their struggles to find the resources they need to deliver services. Their workforces have watched with dismay as any wage increases over the past 20 years got swallowed up by healthcare expenditures.

The early adopters in the public sector are not only lowering their own costs, they’re also creating a new path that any business can follow, and lending credibility to new delivery options. Whether you’re in New York City or Brownsville, Texas, a school district is a big enough to set a new bar for cost and quality. When a school district decides it doesn’t like $2,000 for MRIs, but will happily pay $500 directly to a provider that sets the market price for every local employer.

Of course, change hasn’t come easily. Industry incumbents, including insurance brokers, hospitals, health plans, and pharmacy managers, make tremendous amounts of money maintaining the current system. Change will only come when the people with the checkbooks – the employers – step up and demand more value for the money they’re spending.

That also requires changes from the employers themselves. The days of outsourcing your healthcare to to the same old players are coming to an end. Businesses and organizations will need to staff up in new and innovative ways  – brokers, advisors, and consultants that understand the next generation of healthcare design. We’re moving away from buying the traditional health coverage bundle. Employers will need people with deep knowledge of specialty drugs, everyday services like MRIs and ACL repairs and complex cases like cancers and transplants, that can design care plans that negotiate direct purchases seeking higher quality and lower cost.

As with most changes, it helps to have younger people on board. Today’s 20- and 30-somethings aren’t burdened by 20 years of doing things the old way. They have been lucky enough to come into the business world when new ideas and frameworks are just beginning to take shape. They’re more willing to put down the spreadsheet and challenge the status quo, to see if there’s a better way to do it. They can readily see and embrace the new solutions, the transparency, simplicity, patient focus, and value-based care that should have been the focus all along.

I expect to see continued growth in new healthcare models in 2019, with public sector entities leading by example and the new crop of healthcare professionals helping to accelerate the transition. It’s getting easier every day to see that change isn’t hard – virtually anyone can do it.  It’s just a matter of time before we leave the confusion and high costs of the legacy system behind. More and more companies and employers are finding ways to say: “I no longer pay for volume. I only pay for value.”

Photo: Madmaxer, Getty Images

 

 

 

 

 

 

 



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