2014: The Health Care Year in Review
ICYMI, 2014 was not just any old year in health care. The problem isn’t finding historic events to note, it’s pruning the list. Here’s a crack at some things that we at The Commonwealth Fund thought worth calling out before the ball drops in Times Square.
- Uninsured rate drops: For the first time in modern U.S. history, the uninsurance rate fell precipitously—from 20 percent to 15 percent among adults ages 19 to 64 by the end of the first open enrollment period for the Affordable Care Act’s health insurance marketplaces. An estimated 10 million fewer Americans were uninsured. The appetite for affordable health insurance was strong enough to get past the flawed rollout of the federal marketplace website. And, based on preliminary figures for the still-open second enrollment period, the uninsured rate seems likely to plunge even further before 2014 recedes into memory.
- Spending slowdown continues: We learned more in 2014 about a no-less-historic event unfolding on the spending side of the health ledger: expenditures grew more slowly than at any time since Medicare was passed 50 years ago. Medicare spending alone is $1,200 less per beneficiary per year than predicted just four years ago. While economists scratch their heads over the “why,” some Americans (but not yet all) are seeing the benefits through lower premiums and substantially lower government deficits. The challenge now is how to ensure the slowdown continues.
- Republicans gain control of the U.S. Congress and more: The election results are in: Republicans will begin 2015 with firm control over both houses of Congress, 31 governorships, and an advantage of more than 800 members in state legislatures around the country. Whether divided government at the federal level will lead to an armistice over health reform, or intensified trench warfare, is anyone’s guess. Full repeal of the Affordable Care Act (ACA) is unlikely as long as President Obama remains in the White House, but look for more targeted attacks—possibly through the budget reconciliation process—to gain some traction. At the state level, Republican control will likely mean slower-than-expected expansion of Medicaid eligibility.
- Supreme Court takes up an ACA challenge: In November, the Supreme Court took up a case winding its way through the lower courts that asserts the ACA restricted insurance subsidies only to those states that establish their own marketplaces. The potential ramifications of King v. Burwell, likely to be ruled on next June, are enormous, as a decision for the plaintiffs would have profound effects on the affordability and availability of individual insurance coverage and the functioning of insurance markets. In any 2015 round-up, the Supreme Court’s decision will either be a footnote or the lead.
- Sovaldi draws attention to specialty drug prices: For more than a decade, spending on pharmaceuticals has been slowing, but a narrow slice of the market known as “specialty” drugs threatens to reverse that trend. In 2014, this phenomenon found its poster compound: Sovaldi, touted as a miracle cure for hepatitis C, and priced at $84,000 per course. While many patients will benefit, payers and the public are starting to balk. The question: how many more “miracle cures” can our health system afford?
- Ebola is a wake-up call on global health security: Despite the media frenzy, the experts seem to have been right about Ebola. With a little remedial work, the U.S. health system is capable of swiftly managing an Ebola outbreak. However, the outbreak has served the useful purpose of drawing attention to world health security. One looming threat is Chikungunya—a mosquito-borne disease that, thanks to climate change and increased global travel, has made its way to the U.S. from more tropical climes. Extraordinarily painful, Chikungunya may pose a greater threat to Americans’ well-being than Ebola, and is emblematic of new disease threats the U.S. will face in the 21st century.
- Delivery system reform gathers steam: More than 600 public and private accountable care organizations (ACOs) dot the landscape, covering an estimated 20 million Americans. The percent of private health insurance payments that are “value-based” jumped from 11 percent to 40 percent in the past year, according to one study. (Both ACOs and value-based payments are part of an effort to encourage higher-quality care and lower costs through increased provider accountability for cost and quality.) Efforts to reduce hospital-acquired conditions saved 50,000 lives and $12 billion since 2010. These individual events don’t remake the health system, but could be leading indicators of major structural reform in cost and quality management.
- Wiring of the health system continues: Five years after the passage of the HITECH Act, $25.4 billion in incentive payments have forever changed the world of health IT. Eighty percent of eligible professionals and 98 percent of eligible hospitals have qualified for these payments by adopting electronic health records. While some providers continue to struggle with the transition and interoperability remains a challenge, an infusion of investment capital in health IT innovations and consumer interest suggest that a potentially transformative digital revolution is now under way in the health care system.
Don’t expect 2015 to be any more tranquil than 2014. For health care reformers, the old adage of “be careful what you wish for” comes to mind. Hang on to your hat, happy holidays, and have a great new year.