Without much fuss, technology companies try to adapt to change, usually faster than anyone can think. After a change is proposed or enacted as law, the first news reports are about how one major company or business is implementing it, and how others are following suit.
Earlier this year, a very big change was proposed and enacted in the insurance industry. Healthcare reforms were implemented and brought huge changes to the healthcare sector. The main motive was to ensure that healthcare services were available to all at affordable prices. Certainly, many facilities struggled with this, but the benefits of this change outweigh any negative aspects associated with it.
Health care providers, health insurers, and employers who offer health benefits to their employees are some of the key players who have been affected, positively or negatively, by these reforms. At the same time, agents, brokers and smaller entities that facilitate the purchase of health insurance are also affected.
On the other hand, there are many opportunities and ideas that other companies can tap into and do business. Software and services caring companies bloom44 are competing hard to win customers – especially in B2B.
Healthcare reform is a real challenge and a test for healthcare IT companies to see whether or not they can adapt to the changes within the given timeframe. The methodology could be simple:
Companies should know what kind of change is required.
Organizations should understand the change and how to address it.
Companies should put in place ways to adapt to change
Companies should ensure that compliance with change is monitored and audited.
It is not easy to adapt quickly to change, but survival in the marketplace requires quick action when change is imposed on the organization. Healthcare companies have resisted the implementation of healthcare reforms, but there are many benefits that healthcare companies can derive from these reforms.
It goes without saying that the short-term changes will have a negative impact on insurer profits. Health care reform requirements dictate that health insurers cannot sell policies with lifetime caps. At the same time, government payments to Medicare Advantage plans will be cut.
Insurance costs are the main target that health care reforms seek to lower. It is expected that if insurance costs can be lowered, more of the 23 million people who are uninsured will be able to afford coverage. This would mean that people would not buy health insurance only when they get sick.
The mandatory benefits package may cost more than the catastrophic plans, ensuring that insurance companies don’t lose money. The health reforms require insurers to offer a certain minimum level of benefits in the health insurance exchanges that individuals and small businesses must use to purchase insurance.
The downside of these healthcare reforms is that the law is expected to cut government payments to Medicare Advantage plans by about $200 billion. Healthcare IT companies, which are heavily involved in this market, will bear the brunt.
The challenge for healthcare IT companies is to analyze the situation and identify the key areas where they need to make changes to ensure their business doesn’t suffer too much. Administrative costs must be reduced to protect profits, as premiums will decrease and decline with the rollout. With the establishment of state insurance exchanges, prices for health plans would become competitive. At the same time, compliance and technology implementation would require a lot of money.
