Without much ado, technology companies try to adapt to change, usually more quickly than anyone else can think. In fact, after the change is proposed or enacted as a law, the initial news are about the implementation done by some big company or firm, and how others are following the suit.
Earlier this year, a very big change was proposed and enacted in the insurance industry. Healthcare reforms were implemented and brought tremendous amount of change in the healthcare sector. The main motive was to make sure that healthcare services are available to one and all within the range of affordable prices. Sure, a lot of entities had to face the brunt but the benefits of this change outweigh all the negativity that surrounds it.
Healthcare providers, health insurance companies, employers who provide healthcare benefits to their employees are some of the main entities that are affected positively or negatively by these reforms. At the same time, agents, brokers and smaller units facilitating the process of health insurance are also affected.
On the other hand, there are lots of opportunities and ideas that other firms can bank upon and create business. Software companies and service providing companies are vying hard to win customers-mostly on the B2B front of business.
Healthcare reforms poses real challenge and a test to the healthcare IT companies as whether they can adapt to the change within the given time-period or not. The methodology could be simple:
- Companies should know what type of change is required
- Companies should understand the change and ways to address it
- Companies should implement ways to adapt to change
- Companies should make sure the compliance to change is monitored and audited
It is not easy to adapt to change quickly but survival in the market demands swift action when a change is imposed on the business. Healthcare companies have been opposing the implementation of healthcare reforms, but there are many benefits that healthcare companies can accrue from these reforms.
It goes without saying that the short-term changes will have a negative impact on insurer profits. The requirements of the healthcare reforms demand that health insurance companies cannot sell policies with lifetime caps. At the same time, there will be reduction in government payments to Medicare Advantage plans.
The insurance costs are the main target that the healthcare reforms are trying to bring down. It is expected that if the insurance costs could decrease, more of the 23 million people who remain uninsured will be able to afford coverage. This would mean that the people will not buy health insurance only after they get sick.
The mandatory benefit package can cost more than the catastrophic plans, which will ensure that the insurance companies are not in loss. The healthcare reforms require that insurers provide a certain minimum level of benefits in the health insurance exchanges that individuals and small firms must use to buy coverage.
On the downside of these healthcare reforms, it is expected that the law will reduce about $200 billion in government payments to Medicare Advantage plans. Healthcare IT companies that are heavily involved in that market will have to bear the major brunt.
The challenge for healthcare IT companies is to analyze the situation and key areas where they need to change in order to make sure that their business does not suffer too much. Administrative costs need to be driven down in order to save on the profits, for, the premiums are going to slide down and reduce as the implementation goes in full-swing. With the creation of State insurance exchanges, the prices of health plans would become competitive. At the same time, technology compliance and implementation would require great amount of money to be spent.