Jeff Bauer, Ph.D., closed out NACHRI Creating Connections 2009 with a rousing, down-to-earth look at the future of health care. Bauer, a partner in management consulting -- future practice leader, from ACS Healthcare Solutions, started his talk by clarifying the distinction between prediction vs. forecasting.
Prediction is saying what will happen or what is likely to happen. Forecasting on the other hand, looks at the odds and at a variety of variables to see the likely outcomes. Bauer has an academic background in both models -- but he cited his most practical experience for the present as his time as a weatherman, with a background in research meteorology.
Underlying conditions for the future of health care
As the basis for Bauer's forecasting of the future of health care, he noted that the underlying conditions that defined health care in the past are radically different from the underlying conditions that will define health care for the future. Health care will change more between 2006 and 2015 than it did between 1965 and 2005. The medical marketplace will change more in 2009 and 2010 than ever before.
Health care reform will be confined by recession and recovery -- there is no modern precedent for where we are today. Precious radically recession have been more national vs. international -- the current recession is a global connected collapse with massive damage to be undone on the global scale.
At the moment, CHIP has been expanded, universal access has been pushed to the back burner,stem insurance mandates are conflicted, and reforms are trying to get their arms around reducing costs of a bloated system. Bauer expects a rising likelihood in reduced Medicaid and Medicare funding and an increased mandate for demonstrable community benefit. The delay in appointing a secretary of Health and Human Services is a challenge stalling all government leadership on health care issues.
Bauer's bottom line forecast for provider revenues for 2009-2010, is that there is only a 10 percent chance that the government will provide increased funding for health care; a 20 percent chance of constant revenue; and a 70 percent chance of declining revenue for health care -- far and away the most likely scenario.
Options for providers will be centered around entrepreneurial models and collaborative models pursuing new ways of delivering health care.
Three trends to be upbeat about, despite the economy
- Medical Science: New Knowledge -- the biggest single factor that decides failure or success in medicine is the adoption of new technologies and accelerating incorporating of medical advancement. Personalized, predictive medicine will take on new significance and will radically transform models of care and reimbursement. Genetic understanding of disease and genetic treatments are revolutionizing research and medicine; drugs are being matched to genetic markers to improve care. These changes in treatment are necessitating greater involvement and team collaboration for diagnosis and treatment. Team management of chronic diseases is critical.
- Technology: New Tools -- Integrated networks (universal connectivity, multiple platforms, new interfaces, multimedia, telemedicine, social networks, etc.), e-health technologies (hospital at home models and enhanced productivity).
- National Population: (2007 was the highest birth numbers in the U.S. of any year in our country's history). Many more clinical trials are being done abroad, and sharing of information is critical to caring for all the different cultural, ethnic and demographic backgrounds in a way that is appropriate.
Some advice for the present
- Efficiency can be done two ways: Most visits for a fixed cost. vs. Minimum cost for a fixed outcome. Either way, efficiency = no waste. Current estimates of health care waste across research sources shows 20-33 percent waste across hospitals. Find ways to eliminate waste.
- Effectiveness is that there is no unexplained variation -- you deliver what you say you will, the way you say you will. Efficiency and effectiveness are a delicate balancing act. Bauer recommends the following idea should be in ever mission statement: "Doing it right, all the time, as inexpensively as possible."
For a copy of Bauer's slides and numerous recommended readings, he has placed a special page for NACHRI on his Web site where these resources are available.
For more context for Jeff Bauer's presentation, the following handouts are available on the NACHRI Web site:
- Forecasting the Impact - Econ 101 Handout (PDF File)
- Forecasting the Impact - Health Progress Handout (PDF File)
- Forecasting the Impact - Lean Times Handout (PDF File)
- Forecasting the Impact - Make Buy Partner Handout (PDF File)
- Forecasting the Impact - On Future Handout (PDF File)
- Forecasting the Impact - Production Factors Handout (PDF File)
- Forecasting the Impact - Productive Reform Handout (PDF File)