Electronic Health Reporter

This is the reason that the Affordable Care Act is not going away, despite the continuing conversations about its demise: In its first five years, the Affordable Care Act (ACA) has already left an indelible mark on the $2.9 trillion health sector. By energizing five fundamental shifts, the law has accelerated the rise of a new health economy predicated on value, according to a new report from PwC’s Health Research Institute (HRI), “Five Trends to Watch as the Affordable Care Act Turns Five.”

“Although the ACA will continue to face crosswinds, it has already had a profound impact on the healthcare business,” said Kelly Barnes, PwC’s U.S. health industries leader. “The ACA has catalyzed major changes in an industry historically slow to change. Our report provides a roadmap that outlines what industry leaders should be doing as these shifts continue over the next five years.”

“Most striking, the five trends have led to the creation of more than 90 new companies that have entered the sector since 2010,” said Ceci Connolly, managing director of PwC’s Health Research Institute. “The ACA has opened gates for savvy investors and startups to take a piece of the $2.9 trillion industry.”

According to the report, although much groundwork was laid in advance of the law’s enactment, health industry business models and imperatives will likely never be the same post-ACA. These five key trends fueled by the ACA have ignited sector-wide transformation:

1. Risk Shift: Raising the stakes for all healthcare players. The ACA added force to new payment models that reward outcomes and penalize poor performance such as high rates of readmission and hospital-acquired conditions.

2. Primary care: Back to basics. Experimentation in new payment models and expansion of insurance coverage are making primary care once again the critical touch point.

3. New entrants: Innovators in the New Health Economy. New entrants are rushing into the market to meet the demand for lower-cost, consumer-oriented care options in the post-ACA era. More than 90 new companies have been created since 2010, according to HRI analysis.

4. Health insurance: From wholesale to retail. Rapid enrollment in the ACA’s public exchanges has demonstrated the potential of retail-style health insurance and spawned renewed interest in private exchanges.

5. States: Reform’s pivotal stage. States have emerged as key players in the reconfigured healthcare landscape, as the ACA gave states notable discretion in how the law could be implemented.

The report provides an outline as to what industry leaders should consider moving forward, to include:

1. Revisiting strategies to emphasize saving over spending and quality over quantity, to serve more consumers effectively and demonstrate affordability.
2. Watching closely as the reimbursement pendulum swings from fee-for-service to accountable care.
3. Innovating to meet the demands of the new healthcare consumer.
4. Pursuing opportunities to enhance consumer choice and engagement in selecting health benefits.
5. Working with states as they continue to shape the future landscape.

The full report Five Trends to Watch as the Affordable Care Act Turns Five is available at http://www.pwc.com/us/en/health-industries/health-research-institute/aca-health-reform.jhtml.