Impact on Medical Technology Due to the Passage of the Patient Protection and Affordable Care Act

Abstract

The purpose of this paper is to outline the overall impact that the Patient Protection and Affordable Care Act (PPACA), most often referred to as ACA, has had on Medical Technology. This will investigate the perspective of the patient, vendors, and manufacturers as well as the overall health care system in the United States (US). The PPACA was one of the most broadly sweeping legislation that impacted health care in the US since the advent of the Medicare and Medicaid programs in the 1960s. Included in this overview will be the positive impacts and the unintended impacts of this act.

The Intent of the PPACA

The PPCA provided sweeping changes to the health care sector, with the main goal of addressing access to healthcare by expanding provisions for Medicaid expansion and 'near-universal' insurance coverage. The entire Act brought opportunities and barriers for the citizens of the US. That stated, it also provided medical technology advancement opportunities through funding demonstration projects, incentives and expansion of insurance, such as Medicaid and Medicare’s Innovation Center. This Act also cited a movement towards disruption and primed the path for companies such as Amazon, Wal*Mart, Walgreens retail Clinics, mergers and smart devices to force systems of health care to think differently about the standard care delivery settings.

The patient was the intended focus of the PPACA, and their engagement drives the response from the manufacturer and the systems itself. The Government continues to drive change in the healthcare system to reduce cost and improve quality with value-based risk-sharing demonstration projects. The consumerism that is embedded in our US Healthcare system under a free market will continue to be the greatest challenge to bending the cost curve, US citizens demand the newest and best without barriers to access or availability.

Medical Technology

The definition of medical technology is broad. It is defined as 'the practical application of the scientific body of knowledge to improve health and create efficiencies in the delivery of healthcare.' Medical Technology encompasses improvements in medications, imaging services, surgical services, laboratory testing, medical devices, telehealth, research home monitoring as well as electronic medical record systems. As a science medical technology has changed the care delivery settings as well, as technology advancements occur the need for specialized skill sets leading to different educational tracks and specialties has been realized. The growth in Life Science cannot be omitted from these advancements, especially regarding research that helps with understanding and treating diseases.

The Patient Perspective Relating to PPACA and Medical Technology Advancements

The patient is the center of everything we do in healthcare. The relationship between the provider and the patient drives referrals, choice, and utilization. Typically, patients must have access to care and be engaged, different generations access and value healthcare differently. This generational difference has led to market drivers in medical technology, especially around personal and smart diagnostic devices.

Let’s focus on access first, this was one of the core elements of the PPCA; which is accessible as defined by the supply of services and the ability to afford healthcare services. The most impact on the patient was the new supply systems that were now available, whether it be retail clinics, patient portals or telehealth this opened new dimensions for all sectors, especially those within generational sectors that were as interested in developing relationships as having immediate access to care when, where and how they wanted to access care. The 'disrupters' in the market have also provided new platforms for access to care, such as the 'Minute Clinics', Amazon and Wal*Mart. It is important to note that the expansion of these service settings puts immense pressure on an already scarce labor supply to staff. Theses retail clinics can further cause disparity as they do not feed into a complete medical record for patients who are seeking care outside of fully integrated systems of care.

Telehealth services and smart devices have added to access in all settings of the delivery systems and improved care access. The barrier to most in the rural care settings is access to enough broadband internet service for stable platforms and the technology itself. Rural areas have a higher preponderance of older populations who may not adopt such platforms, but when it is available it further allows for care management.

Patients have also benefited from the expanding growth in new technology services, such as 3-D Mammography, open and wide bore MRI's and rapid resulted in laboratory testing. Providers such as Hospital and stand-alone ancillary testing centers were relieved of further governmental burdens under the PPACA regarding proving the need of services through the Certificate of Need (CON) process. The PPACA felt that the CON process was a barrier and conflicted with the concept of improved access by limiting competition and consumer choice. 

Ultimately, patients have benefited from the PPACA by increased access to government-subsidized health insurance plans, more competition in the market, improved access to care and a growing amount of technology. These advanced technologies, such as gene mapping, is not inexpensive and the balance between cost and benefit against human lives will be the ethical dilemma we continue to face.

The Manufacturer’s Perspective Relating to PPACA and Medical Technology Advancements

PPACA's cornerstone themes are access, efficiency, accountability, and quality. Manufacturers' will need to be aligned in meeting these themes. PPACA is a major influencer in the growth of consumerism in the healthcare sector. The PPACA will increase the demand for healthcare services and with that will come the need for advancement in medical technology as well as increased equipment needs. Manufacturers' that focus on medication, smart or personal devices, home monitoring diagnostics, and efficient high-end therapeutic devices will lead the market.

As payment structures invoke a quality component and steer patients to higher-quality providers, efficient and effective care settings will drive market competition. This has led to the growth in outpatient care settings such as ambulatory surgical centers, mobile imaging services, and retail care clinics.

The disrupters such as Amazon have let to smart speakers that monitor patients’ activities and medication compliance and will send prescriptions refills through “Pill Pack”. Smart devices that measure insulin, or blood pressure, such as those with Apple technology have brought healthcare personal diagnostics to a new level and the consumers’ expectation of care delivery to an expeditious rate

The one sector which has both benefited but also been in the crosshairs of most discussion is the Pharmaceutical sector. This advancing technology saves lives, however, the cost of developing rapid cures is immense and the ability to pay for these life-saving medications is often the burden of insurance companies or providers through free or charitable care. The vast amount of specialty drugs and the increased prices will not be sustainable and the need for regulation will be required.. This sector is by far the single most contributor to the increase of healthcare than any other and continues to grow exponentially. It is important to note that the US consumer drives the demand for new technology and innovation to meet this demand the associated cost is high.

The US Healthcare Perspective Relating to PPACA and Medical Technology Advancements

The PPACA provided the basic protections for citizens regarding the access to health care, just shy of the bill of rights, this legislation laid the groundwork for coverage. “This Act’s main aim was for 'near-universal coverage' through shared responsibility by government, individuals and employers.' This also meant solidifying that there was equity in the quality and affordability of health insurance for all citizens. Last, the Act was to look for efficiency, improve quality and reduce wasteful spending. 

The growth in medical technology has moved most procedures to a more efficient outpatient setting, however, that was also driven by payment reforms that incentivized providers through DRG's aligned with lowering the average length of stays and bundled payments. The innovation necessary to move to these outpatient models of care has led to improvements and has removed some of the overhead burden resulting in lower cost.

The growth in biomedical advances has added to the improved quality of life but has come at a high price of time, resources and cost. The value of innovation must not be dampened by reimbursement models that look at cost and quality without promoting innovation and new technology. It was noted that “payers are making the determination of what is “experimental vs. medically necessary” and this will harm innovation and improved technology and silence the patient”. 

The US Healthcare System's impact from advances in medical technology is ever-changing, the dynamic amount of research, development, innovation, and consumerism will determine its' trajectory. The PPACA has allowed for more access to care by providing a platform for 'near-universal' healthcare insurance coverage, paved the way for Medicaid expansion in most states and provided minimal essential service requirements within all insurance plans. The requirement of the PPACA that insurance coverage must have minimal essential service benefits which are preventative in nature, such as screenings and annual physicals. Covering these services will lead to better health outcomes and reduced costs over the lifetime of the patient and ultimately to the US Healthcare System. This improved availability of expanded healthcare coverage means medical technology will play a greater role in meeting the demands, understanding the needs of those needing services and be primary in Population Health Management.

Conclusion

The PPACA was groundbreaking and revolutionary its' impact will be felt for generations to come. The major themes of the Act outlined the provision of improved and greater access to care for all citizens, higher quality and better outcomes of care while holding providers, payers and individuals accountable will continue to drive the role of medical technology. The US Healthcare System has globalized healthcare and improvements, it has done so by being a leader in medical technology and sciences that promote curative responses.

The impact on the patient, manufacturer, and system itself is underscored by one theme and that is an improvement. The improved patient experience and accessibility to care, the improvement in technology and advancements in health outcomes and improvement are systems of coordinated care for all. This, however, is not without ongoing needs for adjustments and regulatory refinements, such as pharmaceutical cost control, as well as provider payer oversight. Medical technology will be impactful on every sector of the healthcare system and will be necessary for the ongoing provision of care and innovation to cure disease and extend life-saving advancements.

References

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