Healthcare the Day After Tomorrow: What Will it Take?

When it comes to healthcare, America is No. 1, but not always in the ways people might hope. The United States has ranked high in healthcare spending and obesity, while health outcomes have often lagged behind other developed nations.

In 2015, healthcare analyst and futurist Joe Flower argued that the future of American healthcare could look very different: more personal, accessible, effective and affordable. The question was how the industry would move from a provider-centered system toward one focused on value for patients.

Flower, author of Healthcare Beyond Reform: Doing It Right for Half the Cost and How to Get What We Pay For: A Handbook for Healthcare Revolutionaries, shared his outlook with healthcare providers and industry consultants at Kraus-Anderson’s fifth annual healthcare event on Nov. 5, 2015, at Midland Hills Country Club in Roseville, Minnesota.

How Did U.S. Healthcare Spending Reach Its Current Level?

Flower noted that healthcare spending in the United States began rising significantly in the 1980s, when the federal government adopted Diagnosis Related Groups, or DRGs, which established designated reimbursement amounts for hospital treatments.

The intent was to help control costs. Flower argued that the structure instead contributed to rising costs as new procedures and treatment methods increased service volume.

By 2012, U.S. healthcare spending reached 16.9 percent of gross domestic product, almost 50 percent higher than the next-highest spending level among Organisation for Economic Co-operation and Development countries, according to the Organisation for Economic Co-operation and Development’s United States briefing note.

Flower also argued that fee-for-service reimbursement can contribute to waste. He cited studies suggesting that a substantial share of healthcare spending goes toward unnecessary procedures. The New York Times reported on the relationship between medical procedures and U.S. healthcare spending.

What Does Patient-Centered Healthcare Value Look Like?

Flower said that changing course would require a different business model, one that focuses on creating value for patients rather than primarily increasing provider revenue.

The traditional model can be expressed as:

coded reimbursements × volume = value to the provider

Flower proposed a patient-centered model:

health outcomes that matter to the patient ÷ cost = value to the patient

This shift toward patient needs, care access and long-term outcomes continues to inform conversations about healthcare construction, strategic facility planning and the evolving role of healthcare environments.

What Trends Were Shaping the Future of Healthcare?

Beyond the Affordable Care Act, Flower identified seven “levers of change” that he believed were guiding the industry toward a more consumer-driven healthcare future.

• Shopping: The growth of retail care, medical tourism, direct-pay primary care and cost-plus groups gives consumers more control over healthcare costs and choices.
• Transparency: Consumers have greater access to healthcare cost information, treatment options and provider-performance information.
• Results: Rather than focusing only on procedures completed, healthcare organizations increasingly ask whether patients are healthier. Payment structures tied to quality, improvement and outcomes can strengthen the benefit side of the cost-benefit equation.
• Prevention: Wellness programs and health-risk assessments do not always reach the people who could benefit most. Flower noted that employers and healthcare organizations were exploring new ways to improve engagement, manage chronic disease and move from volume to value.
• Targeting: Flower noted that a small share of the population accounts for a significant portion of healthcare costs. Identifying people with complex needs and providing preventive support may reduce the need for costly acute care.
• Technology: Virtual visits, remote monitoring and other technologies can help reduce costs and improve quality. Flower said hospitals would need more effective, connected healthcare information technology systems to realize that potential.
• Trust: Flower described trust as healthcare’s greatest efficiency opportunity. “None of your other strategies will work if they don’t trust you,” he said.

For current perspectives on healthcare delivery and facilities, explore healthcare industry trends, healthcare facility planning and healthcare construction trends.

How Can Healthcare Organizations Serve Patients More Effectively?

Healthcare is in transition. Flower described a shift from a traditional model of delivering value primarily to providers toward a model that creates meaningful value for healthcare consumers.

Every American has a role in moving toward a healthier healthcare system, Flower said.

“It boils down to, who are you going to serve?”

In this article, Joe Flower discussed the future of healthcare delivery, including healthcare spending, patient-centered value, transparency, prevention, targeted care, virtual-care technology and trust. Learn more about healthcare construction, accessible healthcare and rural healthcare trends.