By Jonathan Papp on 12/31/18 10:00 AM
It’s been a great year for Circulation and we wanted to take a minute to thank everyone for the support — our clients, our partners, our blog readers, and our employees. We’re on a mission to fundamentally change the way healthcare is consumed and your support is critical to making it happen.
With 2018 now in the books, we’re looking ahead to 2019! To kick it off, we came up with 5 of our top projections for the healthcare industry in the coming year.
1) Efforts to improve social determinants of health will strengthen as a result of CMS imposed penalties on hospitals for high readmission rates.
According to recent CMS data, 2,599 hospitals will receive reduced reimbursements due to having higher than expected rates of 30 day readmissions — that’s 82% of the eligible hospital participants in the program. As a result, these hospitals will face a 3% reduction in their Medicare reimbursement in 2019. To turn around higher rates of readmissions, many providers are renewing efforts to address health factors outside of the home that can be responsible for adverse outcomes like readmissions.
Like food insecurity. Recent studies have shown that malnourished patients cost nearly twice as much as well-nourished patients because they experience prolonged hospitalizations and higher rates of readmission.
Or access to a ride. One provider organization that works with Circulation has been able to decrease their readmission rates by removing barriers patients face that can prevent them from attending follow up appointments immediately after a hospital stay. By offering a free ride through Circulation, however, more patients have been able to attend these crucial follow-up appointments and as a result, patient readmission rates have decreased over time for the organization.
Based on the prevalence of CMS penalties, we expect that more organizations will attempt to reduce patient readmissions through new initiatives that address social determinants of health.
2. Investment in digital health technologies will increasingly focus on delivering better care in the home
Forbes is projecting a 30% growth in digital health investment towards care in the home by the end of 2019. One driving force behind this prediction is the future makeup of the U.S. population. With baby boomers fast hitting the 65 and over age group, the percentage of the population that’s eligible for Medicare is expected to grow from 13% of the total population in 2010 to 19% of the total population by 2030. This demographic trend, as well as the preference of a majority within this age group to age in the home for as long as possible, is leading the way for investment and new innovations. New technology such as voice enabled assistants, Telehealth video consultations and remote patient monitoring are fast gaining traction and investment. And Forbes is projecting home care digital technology to become a $25 Billion global market by the end of 2019.
3. Medicare Advantage plans will become even more appealing
In 2018, nearly half of new Medicare beneficiaries opted for Medicare Advantage Plans over traditional Medicare coverage. And with several favorable CMS rulings, Medicare Advantage Plans have been empowered to provide more supplemental benefits that aim to improve the quality of their beneficiaries’ lives. These benefits include non-traditional services to prevent negative health outcomes associated with socioeconomic factors. For instance, plans can offer benefits that address food insecurity, transportation access issues, and even connect members to community events or institutions. However, the CMS ruling was announced too late for most plans to incorporate these new supplemental benefits in their FY19 plans. Just 7% of Medicare Advantage beneficiaries belong to 2019 plans that offer these benefits. Despite the late announcement, in 2019, we can expect most MA plans to announce plans that cover these innovative supplemental benefits with roll out planned for FY20.
4. AI healthcare applications will become more commonplace, less of an enigma
Not long ago, the promise of using AI technology to solve healthcare challenges seemed like a far-off idea. But thanks to advancements, investments and new companies, the promise of AI is already being used by healthcare organizations today. We expect these innovations will be more widely adopted in 2019 — innovations such as AI-based technology that can improve the accuracy of medical imaging diagnosis, innovations that can reduce documentation and hospital errors, even AI-enabled robotics that can deliver medical services. Especially in the area of medical imaging diagnosis, we expect to see the AI promise further come to fruition in 2019. And these ideas are getting the green light from regulators. For example, earlier this year, the FDA approved the marketing of an artificial AI-based device that detects certain diabetes-related eye conditions.
5. Medicaid is ripe for innovation and new technologies will move in to fill the gap
Today, 1 in 5 Americans are covered under Medicaid, with the Medicaid population projected to swell even more over the next ten years at least. Medicaid beneficiaries tend to be lower income and less educated, and are more likely to have societal needs related to unstable housing, employment and food security. Despite these trends, according to a recent study by Deloitte, when it comes to accessing digital technologies, Medicaid enrollees own smartphones and tablets at the same rate as the general adult U.S. population. And with access to smartphones, tablets and app-technology comes the opportunity for innovators to build platforms that can help drive down costs and improve outcomes. Upwards of 30% of non elderly Medicaid enrollees report having a disability of some sort and could benefit from new healthcare app-based technology that can improve their quality of life. For instance, new technology can improve the way mandatory NEMT rides are delivered to Medicaid enrollees. We’ll write more about this shortly.
Happy New Year to everyone and thanks again for reading!
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