What is the growth/decline in Long-Term Health Care Industry?
Last year we saw health technology develop at a tremendous pace. In 2014 alone, investment in health technology topped $5 million; more than double the investment of the previous year.
However, rapidly escalating costs, fast reducing budgets and more stringent regulations are putting the industry under more pressure than ever before, and the strain is starting to show. Cost cutting while improving treatment outcomes and complying with HIPAA, HITECH and Meaningful Use creates the biggest challenge for the healthcare industry in 2015.
The use of big data, powerful analytics, predictive technologies, the Internet of Things and 3D printing are all expected to have a major impact in 2015; however, predicting the trends that will have the most significant impact on the healthcare industry – in light of the daily technological advances – is a tall order.
Some of the major issues, innovative technologies and HIT trends to impact the healthcare industry over the course of the next 12 months – and beyond – have been listed below:
Preparations to Start for ICD-10 Compliance
In 1978 the final draft of the International Classification of Diseases (ICD) was accepted by the International Conference for the Ninth Revision of the International Classification of Diseases and became the new standard for monitoring progress, assessing disease control and evaluating medical care. It did not take long for the limitations of the classification system to be realized and five years later in 1983, work commenced on the new ICD-10 classification.
The limitation of just 17,000 codes demanded a rethink; with an expansion necessary to take into account a myriad of new procedures and diagnoses; with ICD-10 expanding the codes to 155,000. The new codes have now been adopted in numerous countries around the world, but the U.S has been slow to make the changeover. The problem now is that there are simply not enough codes and many of the ICD-9 categories are now full. The changeover to ICD-10 is overdue and now essential.
The U.S Centers for Medicare and Medicaid Services started using the new codes from April 1, 2010, although the deadline for compliance was set for October 1, 2013. Congress has not been keen to make the changeover and delayed mandatory use of ICD-10 for 12 months in 2013. Last year, with the deadline looming, congress again postponed its introduction. ICD-10 now scheduled to come into force on October 1, 2015 and a further delay, while possible, looks unlikely.
This year, all healthcare providers covered by the Health Insurance Portability and Accountability Act (HIPAA) will be required to adopt the new system and use ICD-10 diagnosis codes for all healthcare services provided in the U.S, while new procedure codes are also required for hospital inpatient procedures. Medicaid and Medicare claims for services will not be paid after the Oct 1 2015 deadline if the old codes are used.
The change to ICD-10-CM diagnosis codes is more straightforward as the codes are similar to the previous standard; however for medical procedures the change to ICD-10-PCS presents more of a challenge since the coding is substantially different.
The American Medical Association has pushed for full end to end testing which will be run between January 26-30, 2015, with a second sample to be assessed between April 26, 2015 and May 1, 2015 and further testing scheduled for July 20-24, 2015. The aim is to ensure claims can be submitted to Medicare under the new ICD-10 codes, that they can be properly adjudicated and also to ensure accurate remittance advices can be created.
With just over 9 months to go until the changeover, healthcare providers, clearing houses, payers and billing services will need to start testing ICD-10 products, an ICD-10 implementation plan will need to be developed – if it has not been already – costs will need to be assessed, budgets set and the plan put into action. This is sure to be a major challenge for HIPAA-covered entities in 2015, and one which can no longer be put off.
The Difficulties of Cost Alignment Will Grow
The healthcare industry has faced a continued struggle to provide affordable healthcare for as long as modern medicine has existed; however treatment costs have dramatically spiraled in recent years. Healthcare providers must now cover the cost of implementing new technology, health records need to be converted to digital formats and the industry is facing even tougher regulations.
Any healthcare providers that have struggled to stay profitable in 2014 are going to find the next 12 months extremely difficult financially. 2015 is only likely to see finances strained even more with budgets needing to be stretched further still.
Provided the cost of implementation can be covered, new technologies can be leveraged to improve patient care and can dramatically reduce costs. However, many physicians and hospital administrators have struggled to see the benefit from digitalization and changing over to EHR’s. The transition may be problematic, difficult and costly in the short term, but the long term advantages cannot be disputed. The move to EHRs facilitates more accurate reporting and the analysis of electronic data makes decision making easier.
As healthcare organizations develop their systems to provide clean and consistent data – which can be accessed through all systems – it should translate into much greater efficiency and allow for significant cost reductions to be made. This will of course be a major challenge for providers over the course of the next 12 months.
2015 is also likely to see increased collaboration between healthcare centers and greater use of electronic data to forecast expenditure, drive down costs, enhance revenues and improve patient outcomes.
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