Prior to the holidays, we highlighted the stories and trends that dominated the headlines in FierceHealthcare and other media outlets in 2013. Looking ahead, here are four trends we believe will impact the healthcare industry in 2014:
1. Evolution of Pioneer ACOs
Although industry watchers wondered if the fact that nine Pioneer ACOs dropped out of the program last summer signaled the demise of the government program, it's clear that the Centers for Medicare & Medicaid Services has no intention of ending the project. Earlier this month, CMS announced that 123 new affordable care organizations have joined its alternative program, the Medicare Shared Savings Program, bringing the total MSSP ACOs to 360.
Furthermore, CMS is asking for hospital input on its second round of applications for the current Pioneer ACO model and other models that may encourage greater care integration and financial accountability. So expect the government to announce changes to the current Pioneer model based on the feedback–but not plans to abandon it.
2. Impact of ICD-10 transition
Providers have been slow to move forward with the conversion of ICD-9 to ICD-10, according to a recent survey, but the Oct. 1 deadline is fast-approaching. Although CMS delayed the ICD-10 implementation date once before, there are no indications that it will push back the deadline again. If you are among the 74 percent of providers who haven't made plans for end-to-end testing with external entities or the 50 percent of organizations who have yet to estimate the impact the coding switch will have on you cash flow, you may be in for an unpleasant surprise this year.
"With estimates by those who did measure the impact tallying anywhere from $1 million to more than $15 million, healthcare organizations are in for a rude awakening when they finally realize what [impact] the new standards will have on their bottom lines," said Wayne Cafran, an advisory principal with KPMG, in a statement announcing the survey results.
3. Turnover of hospital CEOs
Latest statistics show that healthcare experiences higher CEO turnover than any other industry. And while industry watchers attributed the departures to the roll out of the Affordable Care Act, there is no indication that the rising turnover rate will slow in the upcoming year.
And new hospital CEOs won't necessarily have a background in healthcare. Although some hospitals have put doctors, nurses and other healthcare professionals in key leadership positions, a recent Black Book Rankings poll of human resource professionals at healthcare organizations found that two-thirds of hospital CEOs hired in 2014 will have a finance and non-healthcare background.
But rather than look outside the organization, hospitals may want to address leadership turnover by building a strong talent pipeline in-house. It costs hospitals four times more to hire and train new management than it does to develop and retain internal leaders, according to an April healthcare management survey.
4. More hospitals become insurers
Population health management and Medicaid expansion have pushed some providers to expand their healthcare services and start offering insurance plans. Many non-profit community health centers have entered the market as more people become eligible for Medicaid and states move enrollees into managed care plans.
But it's not just non-profits joining the competition. MedStar Health, the largest health system in the Baltimore and Washington, D.C., area, began offering employee health plan coverage in 2013 and in October told FierceHealthPayer that 11 percent of its 30,000 employees have signed up for it. And the CEO of Mount Sinai Health Systems in New York City told CNBC earlier this year that he believes that due to the Affordable Care Act and state exchanges, more hospitals will take on the risk.
We'll check back at the end of the year to see if our predictions were correct. Meanwhile, the FierceHealthcare team looks forward to bringing you even more news and best practices in the coming year. - Ilene (@FierceHealth)
