Nine For ’19: The Advis Group Predicts…​

2019 will be focused on reimbursement, access to care, patient safety, and provider quality.  Indeed, 2018 has triggered a greater focus on patient protections and patient safety, a no-brainer must-do after the rash of recent problems and bad publicity for hospitals. Strains on revenue aren’t helping. Less revenue is likely the #1 driver behind the strain.

Look to 2019 as a year for new thinking, new ideas, and incremental changes. Big changes don’t come without a big crisis to drive them, and we’re not there yet.

1.  Big Pharma in the Barber Chair: A Haircut That’s Way Overdue! 
President Trump will seek bi-partisan success against Big Pharma as a way to distract from his political problems. Beating up publicly on an industry sector Americans love to hate is a lot easier (and cheaper) than tackling the nation’s critical issues. And everyone agrees.

Many of Trump’s current proposals are good, but Dems will push harder. Trump wants price disclosures, the removal of gag clauses that keep consumers in the dark, and changes in how prices and co-pays are calculated, along with increased negotiating power for insurers to drive down prices. Dems want Medicare to negotiate prices, caps on out-of-pocket drug costs, a ban on delaying tactics that keep cheaper alternatives from market, and more.

Look for the two parties to find common ground for selfish reasons to the benefit of consumers trimming Big Pharma. See…the system is working!

2. Hospitals Aim High in 2019
With medical marijuana approved for use in 38 states, 2019 could be the year marijuana dispensaries start showing up in hospital affiliated organizations. That’s right: somebody is going to roll the dice, assuming that the Feds will continue to turn a blind eye toward commercializing marijuana. Better still, if the Feds decriminalize medical marijuana altogether, hospital dispensaries may well appear overnight. The need for new revenue is that dire.
State governments could boost hospitals struggling against tight margins by approving tax breaks to the industry and dispensaries alike for locating new business where a social good might blossom.

3. With micro-hospitals on the rise, it’s a beautiful day in the neighborhood!
Watch for micro-hospitals to increase in popularity. Providers will step up efforts to address the rise of consumerism in healthcare by expanding “neighborhood medicine” locations.  Despite a Whitehouse call to eliminate the certificate-of-need (CON) process, 2019 will see states with CON look for ways to limit organizations not already established in their markets from developing micros. Keeping chains and new start-ups out, or forcing new comers to JV with established providers, will be the order of the day.  You can also bet that as these mini- facilities pop up on local street corners across America, CMS will make certain that they are “primarily engaged” in acute care medicine.

4.  Hospital Incubators given a Whole New Meaning
As hospitals work to right-size scope and services to improve revenues, what will become of these hollowed-out edifices with empty beds? Beyond a thriving outpatient business, what’s to be done with all that space? If hospitals are smart, they will take a page from the airport play book and become retail site destinations for local shoppers and ancillary providers.

Who’d take up residence in a hospital?  Merchants that like customers with time on their hands:  booksellers, optical stores, restaurants, farmer’s markets, massage and nail salons, hairdressers, jewelry shops, and more.  Hospitals with large empty spaces might even offer shared space arrangements to community organizations and start-ups. Like experimental green spaces, hospitals might become incubators for entrepreneurship. Or people can just mall walk.

And speaking of entrepreneurship, don’t be surprised to see your neighborhood hospital on Grub Hub. Who better to serve up healthy nutrition delivered to your door than your local hospital?  Such a service would be a boon to those with chronic conditions dependant upon healthy eating, and to hospitals, too, looking to make an extra buck.

5.  From Safety Net to Social Net
With CMS finally realizing that good health is inextricably linked to housing and food security, look for mission-driven providers to follow reimbursement opportunities. Hospitals will re-purpose vacant patient rooms and cafeteria facilities into supportive housing developments, cafeterias, or even soup kitchens.

6. Medicaid Work Requirements Will Expand 
Within months of adopting work requirements, Arkansas shed nearly 4,000 individuals from its Medicaid rolls.  That kind of cost savings could be tough for even blue states to ignore.  But whether work requirements lead to enhanced socioeconomic status, maintenance of health insurance coverage and improved health, or just needy individuals losing health coverage, remains to be seen. As more states pursue Medicaid work requirements, watch for more court battles and rigorous evaluation of the policy.

7. Hacked!
Healthcare was a lucrative target for hackers in 2018, with ransomware, misconfigured cloud storage buckets, and phishing emails dominating the security breaches. Despite better awareness among healthcare organizations that greater funding is needed to protect themselves, cybercriminals will likely get more creative in 2019 and the security breaches will continue.

8. Competition Heats Up for the Medicare Advantage Patient
New Medicare Advantage plans, many born of innovative partnerships between payers and providers, are creating more options for beneficiaries to supplement their existing coverage with high-value offerings. The University of Chicago Medicine and Humana recently agreed to allow MA health plan members to utilize services at their outpatient facilities, clinics, and group practices at no additional charge.  Plan beneficiaries also gain access to personalized care, proactive health screenings, and enhanced chronic disease management.

With the popularity of Medicare Advantage plans ever increasing, MA will become the gold standard for reimbursement. Providers will want to aggressively compete for MA enrollees; and they’ll meet those enrollees wherever they can find them.  Don’t be surprised if at your next visit to a black jack table you encounter a primary care clinic geared toward the MA enrollee.

9.  ABC Targets Healthcare Acquisitions 
As Amazon, Berkshire-Hathaway and JP Morgan Chase look to piece together a cheaper, better
quality, more accessible health system for their employees, they’re stuck between the cost efficiencies of a universal system and the urge to acquire everything from hospitals and physician groups to outpatient facilities and insurers. Don’t be surprised if ABC punts. Following their initial attempt to carry the ball, don’t be surprised if ABC appeals to CMS and Congress for more bi-partisan initiatives and a greater effort to level the playing field for everyone involved. If the government would first tend to the sloppy field conditions it would be easier (and less risky) for ABC to carry the ball.

For more information on how The Advis Group can help you navigate 2019, please contact us.