PwC’s 2019 trend to watch: Healthcare’s becoming more like the broader economy

PwC has issued its latest report on healthcare industry trends to watch in 2019, and the overarching theme is the “new health economy.” (Getty/utah778)

Healthcare was long considered an outlier compared to the rest of the economy, but it’s now behaving more in line with other industries—and that’s driving the trends to watch in 2019, according to a new report.

PricewaterhouseCoopers released its annual list of industry issues to track in the coming year, and the overarching theme is that the “new health economy” is finally beginning to take flight.

Ben Isgur, leader of PwC’s Health Research Institute, told FierceHealthcare that there are several factors driving healthcare’s burgeoning economic transformation. For one, most major corporations have a healthcare presence, especially as technology and digital platforms take on an even greater role in care delivery.

Free Daily Newsletter

Like this story? Subscribe to FierceHealthcare!

The healthcare sector remains in flux as policy, regulation, technology and trends shape the market. FierceHealthcare subscribers rely on our suite of newsletters as their must-read source for the latest news, analysis and data impacting their world. Sign up today to get healthcare news and updates delivered to your inbox and read on the go.

In addition, patients are starting to expect the same kind of consumer experience in healthcare that they receive elsewhere—quick, convenient and digitally enabled.

Consumers have “been saying all these things and they’ve been voting with their feet, so we’re starting to see the actual structure of the health system change,” Isgur said.

RELATED: Consolidation, convenience care major drivers behind increased healthcare costs in 2019, PwC projects

Healthcare accounts for a fifth of the U.S. economy, and that also makes it a very attractive target for investors. Private equity’s interest in the industry is another piece of this transformation to watch moving forward, Isgur said.

This is especially true, he said, as more digital therapeutics begin to proliferate. Investors also see potential in smaller, cottage industries, such as private dermatological or ophthalmological practices, which can attract investment.

“What is happening and I think what investors see are opportunities,” he said. “They’ve seen kind of this systemization of the larger, more formal parts of the health system.”

The challenge in tech remains, though, that providers still don’t have the workforce and privacy capabilities to really go all-in. Some, Isgur said, are pursuing an upscale of their own employees to put them in tech-facing positions.

And because the system is becoming a bit more stable and aligning better with the economy, Isgur said that trends indicate providers with high Medicaid or uninsured populations can perform better.

RELATED: 5 ways hospitals can mitigate risk from a growing uncompensated care burden

These providers took to the demand for convenience care and low-cost options more immediately, and are better off now in the market for it, he said.

"Traditional Medicaid providers have learned to survive on that,” he said.

Despite all of the change in the U.S. healthcare system, Moody’s Investors Service projects a stable outlook for the global health economy next year, and in particular a positive outlook for medical devices.

“Rising healthcare spending will continue globally in 2019, as aging populations in mature markets increase demand, access to care in emerging markets improves, and technology and innovation drive new product launches,” Jessica Gladstone, a Moody’s associate managing director for its healthcare team, said in a statement.

“However, political risks will also increase as governments and other payers face increasing pressure to contain costs.”

Suggested Articles

Blue Cross and Blue Shield of North Carolina and Cambia Health Solutions have jointly decided to end their talks to enter a "strategic affiliation."

The Trump administration's new rules to overhaul the Stark Law have some areas that could create major regulatory headaches.

Medicare Part D beneficiaries could see their out-of-pocket costs go up next year before they reach catastrophic coverage, a new analysis shows.