Policy Updates to Create a 21st Century Health System

October 13, 2016

Takeaways

If health care is to become better and cheaper, companies must be bold and innovative.
Regulations must be updated to reflect the current health care environment.

In 2010, we established a new national imperative—we must improve the patient experience, improve population health and reduce costs. The passage of the Affordable Care Act set in motion the most significant upheaval we have ever seen in the health care industry by linking patient outcomes to hospital/provider revenue. Today, new quality of care measures are being put in place, payments are tied to performance on these measures and hospitals are now accepting some of the risk in patient care. All of this is taking place with a rapidly growing aging population that needs care, while millions of Americans are receiving health coverage and visiting doctors for the first time. However, a growing portion of the newly insured are also struggling to afford the premiums and the co-payments that their policies require.

Complicating matters, payments from insurance companies and reimbursements from Medicare and Medicaid are stagnant or declining, at the same time the payment structure is gradually changing from volume-based to value-based. This complicated transition presents a real challenge for all of us in the health care delivery business. The rules and regulations that we operate under today were largely written more than 20 years ago. I, along with others from the hospital sector, believe the federal and state anti-trust and anti-kickback laws should be updated and modernized to reflect the current health care environment.

For example, I believe federal and state anti-trust laws should be revised to allow for limited collaboration among competitors, particularly in back office functions such as in IT systems, electronic medical records and human resources operations. By sharing in the investment in these solutions, we can lower the cost of doing business and free up resources to bring value to patients, and improve population and public health. Policy changes are needed in order to allow hospitals, health systems, physicians and other providers to work collaboratively for the benefit of patients and to reduce overall system costs; and I believe this can be done while still maintaining the benefits of competition in the market.

Second, there are a number of anti-kickback and safe harbor regulations in effect that restrict our ability to provide more efficient, coordinated care, as intended by the ACA.  The existing rules and regulations are a bureaucratic nightmare that, in some cases, are contrary to what the ACA requires of us. These policies should be reformed to be consistent with current law so that we can move ahead on providing the most efficient, coordinated care possible.

This is an exciting and extraordinarily challenging time for the health care industry.  If we’re going to achieve the national imperative — improving quality, reducing inefficiencies and bending the cost curve — we have to be bold and innovate in new ways to deliver care with policies that allow for this innovation to take place. These policy changes would impact health systems across the country, allowing us to better serve our patients and our communities.

Despite these policy hurdles and a changing landscape, the future of health care is bright. Because of the Affordable Care Act, 20 million adults now have health care coverage. With several important policy changes, we will make certain that the care we deliver will be efficient, cost-effective and the high-quality our patients expect—and deserve.

Carl Armato is the President and CEO of Novant Health. He will speak on October 18, 2016 at HEALTH FORWARD hosted by the U.S. Chamber of Commerce and U.S. Chamber of Commerce Foundation.