Finding solutions to healthcare’s biggest challenges has never been an easy task.

However, demands for transparency are growing louder, legislative proposals that would revamp the entire system are stacking up, and unparalleled technological innovation is changing the way we perceive healthcare as a whole. As a result, the challenges might be more complex than ever.

The 2020 presidential election is on the horizon, which will likely introduce additional challenges to the industry. Pharmaceutical companies are being thoroughly scrutinized due to rising drug prices. Big data is playing a big – but not always effective – role in healthcare systems.

In this environment, it’s important for healthcare companies to integrate cost-effective programs, increase efficiency in spite of ever-changing compliance regulations, and provide excellent patient care. With these factors in mind, here are four significant challenges the healthcare industry is facing as we head into 2020.

Rising Drug Costs

Through the first half of 2019, prices increased for more than 3,400 drugs – which is a 17% increase compared to the first half of 2018.

Drug prices continue to rise, outpacing wage growth and the cost of living. Insulin – a critical drug for diabetics – nearly doubled in price from 2012 to 2016. Other common drugs with rapidly increasing drug prices include Mometasone (381% increase) and Promethazine/Codeine (326%). This is an alarming trend not only for consumers but also healthcare companies, such as insurers, who must determine when and how to cover new drugs and whether to impose limitations on said coverage.

Providers are significantly impacted too. According to an American Hospital Association report from earlier in 2019, rising drug prices and widespread shortages are hampering hospital budgets and operations – and, ultimately, patient care. Per the report, from 2015 to 2017, average total drug spending per hospital admission increased by 18.5%.

Keep an eye on legislative actions, which will have significant implications. One such bill is the Lower Drug Costs Now Act – which would (1) empower the Centers for Medicare & Medicaid Services (CMS) with the ability to negotiate drug prices and (2) impose price limitations on some of the most common drugs.

Complying with policies

Whether its new legislation or amendments to existing acts, government regulations and policies are constantly changing. Complying with these changes is of the utmost concern for healthcare companies.

In addition to recent movements to repeal or amend the Affordable Care Act – which, alone, would be a mountainous burden to adapt to – there’s also the challenge of incorporating the policies of the Center for Medicare and Medicaid Services (CMS), which issues hundreds of updates each year.

For example, the CMS released an update memo in August for the Medicare Communications and Marketing Guidelines (MCMG) for 2020. The brief memo addresses wide-ranging amendments to the prior year’s version, including notable changes to unsolicited marketing and educational events.

This memo alone requires a thorough, time-intensive review given the plan’s comprehensive changes. [link to Sepire post on MCMG interpretation]

Healthcare providers and insurers alike are being overwhelmed by changes and new reporting requirements. It’s more pertinent than ever to be actively prepared for and engaged with compliance updates. Impacted companies can benefit from document control programs, internal audits, and swift responses to incidents of non-compliance.

Providing value-based care

Personalization and emphasizing the “customer experience” are growing trends in the world of the consumer. The healthcare industry must adjust to a similar trend: the increasing importance of the patient experience. This translates to providing value-based care – versus a fee-for-service model.

Transitioning to a Merit-based Incentive Payment System (MIPS) is a cumbersome process.

The idea is to increase economic efficiency and pivot from “quantity” to “quality.” In a traditional fee-for-service model, healthcare providers’ earnings increase with each additional test, treatment, and prescription. From an incentive perspective, the cost of each service is more important than each service’s effectiveness.

In a value-based care model, the emphasis shifts to quality and efficiency via coordinated efforts. Providers are rewarded for efficient processes and positive results.

Healthcare providers can adjust to a value-based format by executing contracts that focus on reducing costs, improving the patient experience, and enhancing the quality of patient care. Further, it would be prudent to maintain open channels of communication with patients – in order to increase price transparency.

Using big data effectively

The rise of “big data” has raised the ceiling of the healthcare industry by revealing patterns and trends that can be studied and manipulated to improve costs, efficiencies, and quality of care.

But – that’s only if healthcare providers have the infrastructure and operational support to even take advantage of big data.

One of the culprits that’s limiting healthcare companies is legacy technology that lacks the functionality and scalability required to reach big data’s potential. Further, the disconnect is amplified when healthcare providers lack data management capabilities, controls, and staffing. In addition, there’s a knowledge gap between healthcare professionals and information technology experts. In many cases, neither side understands the other’s profession and needs.

Big data’s value can only be leveraged once these discrepancies are accounted for. To bridge this gap, healthcare executives and their IT counterparts must commit to aligning their efforts in order to improve workflows and patient care.

The advantages and uses of big data can also be interpreted differently – depending on the perspective. Healthcare providers may focus their sights on care delivery, while payers may place more emphasis on costs. However, both parties can benefit from sharing data to better shape the other’s perspective.

Interested in learning how Sepire can help you bridge the gap when it comes to data, communications and upcoming regulations? Reach out to us.