We launched into the year by inviting some of our favorite thought leaders to share their predictions for 2019. Now as the year draws to a close, it’s time to take a retrospective look at how our forecasters’ insight has played out in the healthcare market since.

Our experts included:

PREDICTION 1: WASTE WILL CONTINUE

Fact Check: True

All of our experts pointed to waste as an ongoing challenge in 2019, and they were 100% on target with that assessment. The system is still slugging along in the well-worn fee-for-service tracks because the value-based incentives aren’t quite attractive enough to fundamentally realign the business model toward outcomes.

Yes, there are pockets of innovation. The trouble is, the innovation hasn’t reached scale. Why not? Cutting waste is hard. Really hard.

Nash identified operational, clinical, and individual waste as overarching issues. “Focusing on cost alone is not the way to fix the cost problem,” he said in his 2019 prediction.

“Anybody can cut costs — that’s easy. The only way to fix the cost problem is by reducing waste, which is a far more complicated problem.”

David Nash, MD, MBA, Dean, Jefferson College of Population Health

In fact, a study published in October in JAMA suggested that waste in the U.S. health system accounts for 25% of spending — somewhere between $760 billion and $935 billion annually. Authors noted that different types of waste will require unique approaches, not the least of which is cross-channel collaboration among payers, providers, and even the new disrupters arriving on the healthcare scene.

Waste has indeed continued. Its solutions are slow-moving and exceptionally hard to pin down.

PREDICTION 2: COMMUNITY- AND HOME-BASED CARE WILL PICK UP SPEED

Fact Check: True

In 2019, new guidance from CMS took effect, allowing Medicare Advantage (MA) plans to deliver non-skilled, in-home care services as a supplemental benefit. MA plans started forming strategic partnerships with home-care providers throughout the year, anticipating greater use of those services in 2020.

And MA itself is growing, climbing at a rate of about 8% per year for the past several years. In 2019, enrollment hit 22 million beneficiaries, representing 34% of Medicare overall.

Leff noted in his 2019 prediction that Hospital at Home programs continue to be a model for lower costs and better outcomes. Extending that model to also include community-based services only makes sense. “Now you’re seeing innovations where you can use your phone to order one hour of personal care the way you might order a ride from Uber,” Leff said.

“As more care moves toward the community, those services will connect with one another, supply chains will develop, and payment models will develop.”

Bruce Leff, MD, Director, The Center for Transformative Geriatric Research at Johns Hopkins University

Research is proving that the advantages gained through home-based care can be attributed to shorter lengths of stay, reduced readmissions, and better patient satisfaction. The potential for home-based care to disrupt other types of care delivery — and even put some inpatient units on notice — is vast, according to Leff. He often notes the return on investment for Hospital at Home programs exceed those of other common therapies by comparison.

[Related reading: Market Innovations: Reviving the House Call]

Home health spending was forecasted to hit $108.8 billion in 2019, according to CMS, with steady growth over the next several years, reaching $186.8 billion by 2027.

McDaniel also noted in his prediction that technology is enabling providers to deliver care almost anywhere. “One of the biggest benefits of digitization is the ‘untethering’ of patients from hospitals and other bricks and mortar settings,” he said. And health systems are embracing the opportunity.

In October, the Cleveland Clinic announced a broad initiative to further advance its telehealth capabilities. The Clinic believes that 50% of its outpatient visits will be delivered virtually within five years.

Opportunities for care delivery outside of the hospital/office setting are clearly growing. Meanwhile, technological tools and payment models have begun to catch up.

[Related reading: Consumers Say “Yes” to Three Convenient Distributed Care Models]

PREDICTION 3: PHYSICIANS WILL WRESTLE WITH RISK AND BURNOUT

Fact Check: True

Burnout among physicians has become plainly evident. It’s not just watercooler talk. By spring, even the federal government acknowledged the challenge of cumbersome administrative tasks — most of them related to quality reporting and practice re-engineering to shift toward value-based arrangements.

Kuerbitz said in his prediction that physicians realize they’re at an inflection point where the system must be transformed into a market that provides value. However, the system must better align finance models with the provision of care in order to achieve that.

“I consistently see practices and health systems struggle to operationalize a gradual glide path to risk. I don’t think that’s possible,” Kuerbitz said.

“Practices must be positioned to make significant upfront investments in infrastructure and physician incentives, and without that, are likely to experience a growing sense of burnout and frustration in managing risk.”

Ron Kuerbitz, CEO, agilon health

In June, a study estimated the financial cost of physician burnout at $4.6 billion per year, attributed to turnover and reduced clinical hours. Additionally, a survey released in October by the Medical Group Management Association revealed that 86% of medical practices said regulatory burdens have increased in the past year, with pretty much all of them agreeing that reducing the burden would allow them to deliver more patient care.

Patients want more time with their doctors, not less. Payers want measurable improvements. The burden of both continues to fall on the providers’ shoulders.

PREDICTION 4: MORE NON-TRADITIONAL COLLABORATIONS WILL KEEP SHAKING THINGS UP

Fact Check: True

Few are surprised by the galvanization seen among healthcare players in 2019. The cost curve has inspired unique partnerships and out-of-the-box innovations aimed at economies of scale as well as winning in the Smart Health Market.

“Look at the behemoths: Amazon, Walmart, and Google. They have a tremendous number of employees. Why would they need an insurance company?”

Jon Zimmerman, President, Virence Health Technologies

Not only are those big B2C brands looking at direct contracting for their employee healthcare programs, many are also getting into the provider market to serve their customers, too. For example, in September, Walmart opened its first 10,000 square-foot health center, complete with primary care, imaging, dental, and behavioral health services.

“There are many players in the ecosystem, but if we work together, we can create a smart health market,” Zimmerman said.

Uber is another example of a non-traditional player entering the healthcare space and making impact. More than 1,000 partners are using Uber Health’s HIPAA-compliant platform to schedule and track rides for patients who need transportation to medical appointments. The service has ramped up considerably in 2019, with large health systems and payers of all types signing on. Stakeholders believe the $15 or $20 spent on a ride to the doctor is a good investment to reduce the more costly no-show situations and the downstream negative health effects associated with missed appointments.

[Related reading: In Pursuit of Smart Health: Lyft’s Focus on Medicare Advantage Plans]

With household names turning an eye toward the healthcare business, traditional players are looking at a new competitive landscape. It’s healthcare like we’ve never seen it before.

PREDICTION 5: CHANGING THE PREVAILING MINDSET IS THE KEY TO REAL SUCCESS

Fact Check: True

Of all our predictions, this one rings true with the loudest resonance. It’s not just the fee-for-service mechanisms that need to change, but the overall attitude about what healthcare delivery really is today. Because of technology, medical advancements, and rising consumerism, the emerging system is starting to function more like a market and less like a collection of businesses all operating independently of buyer influence.

Consumers are increasingly deciding healthcare’s path forward thanks to their practical market behaviors in 2019. For example, drop-in clinics and telehealth services continue to grow because consumers like the convenience. Therefore, payment models have to catch up.

“There are still many incumbents trying to protect the status quo,” McDaniel said. “Those groups coming together and getting bigger could hinder industry progress. Or, those groups could end up getting blindsided by not being able to compete in a market-driven economy.”

McDaniel warned that none of today’s stakeholders are too big to fail, and all must make the effort to understand their consumer base as well as their competitors. The Smart Health Market is separating winners and losers.

“If your consumers had the same kind of transparency into your business as they do other retail businesses, like pricing exposure, etc., would they use your services?”

Don McDaniel, CEO, Canton & Company

[Related reading: Providers Still Falling Short of Consumer Demands]

That question has become even more relevant in 2019 as lawmakers wrestle with the best way to approach costs from the constituent’s perspective, specifically, surprise billing and rising drug prices. In July, the Trump administration announced an initiative to require payers and providers to offer consumers access to real-world cost estimates for their health services — based on negotiated prices in the context of the individual’s benefit plan. All of the initiatives are poised to be major game-changers.

Those who previously held onto the status quo are now understanding a continuation of the past is simply not an option. Change is happening faster than most even thought possible.

Download the original 2019 Healthcare Predictions report here.