May 25, 2017
Published by HARVARD BUSINESS REVIEW
3 Health Care Trends That Don’t Hinge on the ACA
In early May 2017 Republicans in the U.S. House of Representatives voted to repeal and replace the Affordable Care Act (or Obamacare). Subsequently, Republicans in the U.S. Senate began working on their version of a law to do the same. The House bill is flawed, leaving many uncertainties that the Senate has promised to address. While the fate of the bill is in flux, there are three immutable trends in the U.S. health care system that won’t change. As a result, regardless of how the law evolves, tremendous opportunities will remain for consumers, medical providers, health care payers, and investors to shape and improve the health care system.
The first trend is demographic: The U.S. population is continuing to age. In 1960 the median age for men and women in the U.S. was 29.5; it is now 37.9, and in the next 12 years will exceed 40. Per capita annual health care costs are roughly $4,500 for people age 19 to 44; they double for people age 45 to 64; and they double once again for those 65 and older. Thus, as the population ages, health care services will naturally expand, as will the pressure to find efficient ways to deliver those services.
Second, technology has become a pervasive element across the health care system, with a major impact on diagnosis, treatment, and communications. In 2004 one in 5 practicing physicians used an electronic health record (EHR) in the U.S. Today nearly nine in 10 physicians regularly employ EHRs. There’s a tremendous amount of information and structured data now available to guide treatment, assess outcomes, and measure quality of care. Beyond EHRs, digital health tools — apps, wearable devices, and other hardware and software that measures and monitors health — are becoming common in consumers’ lives. From 2015 to 2016, investors poured more than $8 billion into funding these tools. More than 3,000 apps are now available to help manage diabetes alone. Clearly, most of these tools won’t survive. But technology has become rooted firmly in U.S. health care and, as elsewhere, consumers will choose many of the winners…READ MORE