Health and Science

How the health industry is better prepared for GOP reforms

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Call it a case of deja vu.

The health-care industry will once again be caught in the grips of uncertainty over health reform in 2017, but researchers at the PwC Health Research Institute say one thing won't change — the pressure on the industry to provide better value for our health-care dollars.

"We're going to be more focused on cost ... there's public momentum towards understanding better what things cost within health care," said Stacey Empson, PwC partner who specializes in health care. "I think we're going to see it even more with the new administration and changing models."

Controlling health costs is the underlying theme behind many of the issues highlighted in PwC's 11th annual report on upcoming health-care trends, "Top Health Industry Issues of 2017."

Key drivers of health payment reforms include the rise of high-deductible health plans, which are making consumers more price sensitive, and the public backlash over high drug prices, which is pushing drugmakers to try to rein in cost increases to stave off regulation.

The researchers say it is unclear how quickly President-elect Donald Trump's vow to repeal and replace Obamacare will play out. Previous Republican efforts to overturn the Affordable Care Act kept funding provisions for subsidies and Medicaid in place for two years, in order to facilitate a transition to the GOP plan.

"I think the (insurers) will end up ahead in some ways, when you potentially repeal and replace ACA," Empson said. "There is a foundation and a groundwork that's been set."

The large insurers took steps to protect themselves against large losses by pulling back on exposure to the Obamacare exchanges in 2017 and raising premium prices.

Hospitals may have more difficulty weathering the transition if there is an increase in the number of uninsured, and PwC researchers say they should "map out potential gains and losses of insured consumers" as the legislative process unfolds.

From 2009 to 2010, the uncertainty in the lead up to passage of the Obamacare health reform law weighed on insurers and hospitals. Both industries may be better prepared for the new overhaul of health-care regulation in 2017.

"I think that the industry has evolved so much since then. There's much greater proliferation of technology. I think that there's much greater consumer expectation of transparency and accountability," said PwC's Empson.

One big difference, she says, is that the ACA focused on providing greater access to coverage, while the emphasis of the Republican plan is squarely on controlling insurance and health costs.

Can we have both?

"That's the magic eight ball — to find the balance of both," Empson said.