Insights on Today's Healthcare Consumer

Health Care Marketing Gears Up for a Bumpy Ride in 2014

Posted by Brent Walker on Mon, Jun 09, 2014

rollercoaster ride2014 has already been a bumpy ride for health care thanks to the Affordable Care Act, and the future doesn't look to be any smoother.

Weathering the ups and downs to come is going to take a solid health care marketing plan that’s flexible and ready to address changes to health law and government programs as they occur. Here’s a look at four of the major stumbling blocks we’ve seen so far in the first half of 2014:

“Insurance Company Bailout”

In the most recent dust-up, the Obama Administration stands accused of trying to slip through regulatory changes that would make billions of dollars available to health care insurers to prevent dramatic premium increases.

When the Affordable Care Act was first enacted, its proponents anticipated that premiums would remain within a reason range of rates already paid most Americans, as the payments of newly insured younger health care consumers, who use less medical services, could go toward offsetting expenditures for older enrollees. This didn't happen during the first, now closed, enrollment period.

In response to public outcry to in what the Los Angeles Times called “a firestorm of cancellations” early in the year, the Obama administration was forced to reneged on certain policies in order to honor promises made to American consumers. This effectively allowed many young people to stay in low-cost, individual health plans that would have otherwise been on the chopping block—satisfying outrage, but doing nothing to offset the cost of older health care consumers.

As premiums are now being set for next year, the government has once again stepped in, assuring the insurance industry that a multibillion dollar federal lifeline is available to them over the next few years should rates become untenable.

The Accountable Care Quagmire

The Accountable Care Organizations Initiative offers another example of a well-intentioned health care initiative where certain aspects have gone awry.

In an effort to encourage care providers to come together to improve overall health care and increase service efficiency, the initiative implemented new Medicare payment schedules. The emerging reality is quite different and has, in fact, adversely affected the ability of private practice physicians who rely on these payments to compete with hospitals.

As the New York Times reported, MedPac, the federal agency responsible for overseeing Medicare fees, discovered that hospital physicians can now charge Medicare more for the same services than can private practice doctors billing Medicare directly. It's created an environment in which it is easier, some might say inevitable, for hospitals to buyout physicians' practices, turning doctors into hospital employees and leading to greater cost to insurers and higher co pays for plan subscribers. MedPac has recommended changes to correct these disparities which have not, to date, been implemented.

On top of these new rules on how physicians receive Medicare payments, Medicare provider reimbursement rates have dropped across the board in 2014. The cuts, which are designed to save Medicare about $196 billion over the next decade, mean that physicians will see a 24% drop in reimbursement.

The ICD-10 Non-Rollout

If you’re a medical services provider, Congress's extending the ICD-10 medical billing code claims implementation until October 2015 may be a relief. If you're not a medical services provider, a little background:

The International Classification of Diseases, Tenth Revision, Clinical Modification (ICD-10-CM) replaces the ICD-9-CM used by the World Health Organization for coding diseases, symptoms, abnormalities and allows for the use of over 14,400 different codes. The revision of has over 68,000 diagnostic codes— five times more than the ICD-CM-9— and twice as many categories.

Before the reprieve, care providers were mandated to have the codes in place for all medical billings effective October 2014 (which had already been delayed from October of 2013). As of the switch over date, practices still billing using the ICD-9 codes wouldn't be paid.

Although millions have been spent on conversions, often based on a careful health care marketing plan from accomplished systems providers, not all hospitals were out of the development stage. And at the last moment, Congress delayed implementation of the ICD-10 changeover for another year at the behest of the AMA whose members pleaded lack of readiness and great potential harm from unpaid claims.

Will 2015 be any smoother than 2014 for the health care industry?

Probably not, given the continuing rollout of the ACA and all the issues that tend to spring up around it. If you’re going to see any success in the coming year, you’re going to need a health care marketing plan that’s poised to deal with emerging issues.

Where there are challenges, there is opportunity.  As confusing as these changes may be for the healthcare professionals and organizations who live day-by-day in this environment, imagine what the average consumer – who may only be a patient for a limited time out of the year – must be feeling.  A healthcare provider who can help consumers navigate this environment, and instill confidence that they will receive the best possible care, will rise above these challenges. 

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Brent Walker

Written by: Brent Walker

As Chief Marketing Officer, Brent's primary responsibilities include leading marketing strategy and execution for c2b solutions, development of c2b solutions' proprietary consumer segmentation model and insights products, research on healthcare consumers’ motivations and behaviors, and providing marketing guidance to c2b solutions clients.

Tags: Healthcare Innovation

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