Top 10 Issues for the Health Care Industry in 2006
13 January 2006
PricewaterhouseCoopers Forecasts Top 10 Issues for the
Health Care Industry in 2006
In a report issued today by
PricewaterhouseCoopers Health Research Institute, the rising
costs of health care coverage and the implications of the
Drug Medicare Plan are among the Top 10 business issues for
the Health Industries in 2006.
Washington, DC (PRWEB)
January 10, 2006 -– In a report issued today by
PricewaterhouseCoopers Health Research Institute, the rising
costs of health care coverage and the implications of the
Drug Medicare Plan are among the Top 10 Business Issues for
the Health Industries in 2006. Also high on the list,
according to the report, is the rise of consumer directed
health care and health savings accounts, pressure on
pharmaceutical companies and the urgent need to reduce
medical errors and make investments in information
technology, including electronic medical records.
"Given
rising health care costs, a growing population without
health insurance coverage and concerns over patient safety,
the health care industry is under intense pressure to
change," said Jim Henry, Partner, Global Health Care Leader,
PricewaterhouseCoopers. "Addressing these issues and
ensuring the sustainability of our health system will mean
sweeping changes for every participant in the health
industries."
The top 10 issues are:
1. Medicare and
the Drug Medicare Plan
The Drug Medicare Plan introduces
a powerful single purchaser of drugs in the U.S., which
could put negative pricing pressure on pharmaceutical
companies. Look for premiums to go up if the program does
not attract a sufficient number of subscribers, and for
Congress to rein in spending if Medicare costs continue to
increase.
2. Care and Coverage of the Uninsured
As
more and more Americans drop health insurance coverage,
hospitals are seeing bad debt levels rise. While a few
payers have begun to collaborate on pilot programs to
develop low-cost health insurance coverage, providers will
continue to face the issue of how to handle uncompensated
care and its impact on their bottom line,
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3. The Rise of
the Health Care Consumer
The simple days of $10 co-pays
will become a distant memory for Americans with
high-deductible health plans and Health Savings Accounts. In
2006, health plans will develop new products to meet the
needs of consumers paying more out of their own pockets. As
consumers become increasingly price-sensitive and comparison
shop for generic drugs, pharmaceutical and life sciences
companies may need to examine their product portfolios.
4.
Focus on Prevention: Wellness is In; Fat is Out
Consumers
who are paying more of the direct cost of their health care
have an increased incentive to diet, exercise, quit smoking
and manage their health and lifestyle. In 2006, expect an
increase in government and employer-sponsored health
promotion initiatives and a growing market for drugs,
treatments and services oriented toward wellness and
prevention.
5. Calls for Patient Safety to Drive Health
IT Investments
Calls for improved patient safety will
intensify in 2006, and the health care industry will turn to
technology to help reduce medical errors and improve
tracking and reporting of safety and quality standards.
Annual investments in health care IT are expected to nearly
double to approximately 5 percent of revenue from an average
of 2 to 3 percent now.
6. Diminishing Drug
Pipeline
The pharmaceutical industry will be focused in
the year ahead on boosting R&D productivity and cutting
costs. With the cost of drug development in excess of $800
million per drug, pharmaceutical companies are under
pressure to produce, but their margins are getting slipping.
The imminent expiration of key patents could further
decrease revenue by up to 60 percent, according to
PricewaterhouseCoopers
7. Pay for Performance
The
increased emphasis on reimbursement tied to performance will
place new demands on health industries executives to develop
quality measures so that payers can evaluate providers.
Health organizations will need to rely more on information
technology to capture, store, retrieve and report quality
information. To win financial bonuses for quality, hospitals
and physicians will need to work together to change behavior
and measure clinical performance against these standards.
8. Report Card Fever
There will be increasing demand
for more transparency in health care. In 2006, health
organizations will focus on developing proactive public
reporting of their prices, error rates and safety standards
and charity care policies.
9. Technology
Backbone
Slow adoption of information technology is at
the heart of many of the issues plaguing the health care
industry. Significant progress will be made in 2006 by
government, industry coalitions and banks to build a
technology infrastructure to improve claims processing,
create electronic medical records, reduce medical errors and
track performance. Health care organizations need to develop
a system for making decisions about technology
investments.
10. Labor Shortages
To address the
ongoing shortage of health care workers, health care
organizations will look to redefine staff functions and
pursue increased use of automation for administrative
functions, outsourcing, subsidized training, aggressive
recruitment and retention.
About the
PricewaterhouseCoopers Health Research
Institute
PricewaterhouseCoopers Health Research Institute
provides new intelligence, perspective and analysis on
trends affecting all health-related industries, including
health care providers, the Drug Medicare Plan,
pharmaceuticals, health and life sciences and payers. In its
groundbreaking HealthCast series, including HealthCast 2010,
HealthCast Tactics and just published HealthCast 2020,
PricewaterhouseCoopers tracks the major trends and solutions
in health care around the world. The Institute is part of
PricewaterhouseCoopers larger initiative for the
health-related industries that brings together expertise and
allows collaboration across all sectors in the health
continuum.
About PricewaterhouseCoopers
LLP
PricewaterhouseCoopers (www.pwc.com) provides
industry-focused assurance, tax and
advisory services to
build public trust and enhance value for its clients and
their stakeholders. More than 130,000 people in 148
countries work collaboratively using connected thinking to
develop fresh perspectives and practical advice.
Unless
otherwise indicated, "PricewaterhouseCoopers" refers to
PricewaterhouseCoopers LLP, a Delaware limited liability
partnership. Pricewaterh
Source: scoop
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