Before the Affordable Care Act went into effect, the health care industry was in the midst of a significant change in the way it treated patients. Health care organizations were trying to take a more preventive approach to care rather than treating ailments after they had already appeared. This was particularly true in patients who were uninsured or underinsured.
Now that the signature piece of legislation for the Obama administration is nearing full implementation, the law may not only reinforce that change in its approach toward treatment, it may be accelerating its evolution.
Population Health Management
Because of mergers and acquisitions, and the general evolution of health care, hospitals are no longer stand alone institutions that provide inpatient care only. They are more likely to be part of a larger health care network that provides inpatient and outpatient care.
Also part of health care’s general evolution is to take a more proactive approach rather than a reactive one. This concept is called population health management.
“Hospitals are no longer stand-alone institutions that provide inpatient care only.”
As Forbes contributors Robert Lenzner and Dr. Kenneth L. Davis wrote, nowadays emergency rooms are often used as a place for primary care, rather than for true emergencies. Patients who lack health insurance often wait to treat maladies until they become emergencies, then go to ERs for treatment because they know they will not be turned away because they are uninsured.
That is the hospital of today. Davis and Lenzner wrote in Forbes that the hospital of tomorrow is:
“Proactive, devoted to disease prevention. It has a large network of medical professionals reaching into the community, working in outpatient clinics as well as urgent care centers, devoted to maintaining a population’s health and managing diseases. This approach will result in a significant reduction in emergency room visits, an important step to lowering the cost of medical care.”
Such an approach would not only benefit patients, it would also be an important factor in keeping costs down where possible. With today’s system, doctors are rewarded financially for treating ailments. This is called a fee-for-service system.
A component of the Affordable Care Act is the Accountable Care Organization, which is the opposite of a fee-for-service system. Davis and Lenzner wrote that under this provision of the law, hospitals or health care organizations are contracted to oversee Medicare patients’ health. The incentive for reimbursement is to prevent illness rather than treat it after it has appeared. And, by focusing on prevention, organizations can save more money.
Now that the federal health insurance exchanges are operational and Medicaid has expanded, the effect is dovetailing with the trend toward preventive care to create a more profound effect, particularly in areas with a significant low-income populations.
A University of Michigan study revealed that just six months after health insurance was made available to low-income patients (in states that allowed Medicaid expansion), hospitals saw a significant reduction in the number of visits to the emergency room by uninsured patients.
Medicaid expansion provides health care for anyone under the age of 65 whose family income is at or below 133 percent of the federal poverty line. However, states can choose not to take part in Medicaid expansion.
Allowing hospitals to recoup more of its costs rather than having to adjust its fees so that it can absorb those costs incurred by treating those who couldn’t pay was one of the primary goals of the ACA. And it appears to be working.
The study further reinforced the role of Medicaid expansion on hospital costs. In states that chose not to expand Medicaid, hospitals continued to experience the same or even increased demand for care in ERs from those who are uninsured.
Where the Savings Are Going
With the provision in the ACA that rewards health care organizations for prevention, and savings from fewer ER visits, organizations are now expanding their services out into communities and providing a broader spectrum of care.
The goal is to continue keeping patients out of the hospital whenever possible. Doctors are looking at more data, more comprehensive health histories and using that information to establish long term care. With a focus on preventive care, health care providers are also minimizing the time patients spend in the hospital, thereby reducing costs even further. With patients getting their primary care in clinics rather than hospitals, the focus of operations for health care organizations is changing.
This is fueling mergers and acquisitions, as well as expansion throughout the industry. Health care organizations are partnering to extend their reach further into communities. As health care providers continue to see positive change brought on by the population health management, we may see even more change in the industry in the near future.
The Role of Storage
Whether a health care organization is merging with another or expanding its services, storage for equipment or documents promises to be an essential part of the change. Health care organizations may find that they need to build facilities, or in the case of a merger, may need to re-allocate resources to different locations and renovate others.
Mobile Mini has portable storage solutions for a variety of needs. If a clinic is being renovated, Mobile Mini’s steel storage containers are ideal for storing documents, furniture or equipment until renovations are done. Also available are portable office solutions, in the event that renovations to offices are necessary. A health care organization can continue operations during construction and renovation, ensuring that patients continue to receive the care and service they have come to expect.