Can Health Tech Reduce US Healthcare Spending?

CMS Office of the Actuary Releases 2022-2031 National Health Expenditure Projections
Projections of National Health Expenditures (NHE) and health insurance enrollment have been released for the years 2022-2031. The report contains expected impacts from the Inflation Reduction Act (IRA), including that people with Medicare prescription drug coverage (Part D) are projected to experience lower out-of-pocket spending on prescription drugs for 2024 and beyond as several provisions from the law begin to take effect. Read the CMS press release.

The Office of the Actuary in the Centers for Medicare & Medicaid Services annually produces projections of health care spending for categories within the National Health Expenditure Accounts, which track health spending by source of funds (for example, private health insurance, Medicare, Medicaid), by type of service (hospital, physician, prescription drugs, etc.), and by sponsor (businesses, households, governments). The latest projections begin after the latest historical year (2021) and go through 2031.

A Health Affairs journal article from CMS’ Office of the Actuary and the Health Affairs’ study on these projections notes health spending over the course of the next ten years is expected to grow more rapidly, on average, than the overall economy.Annual US healthcare spending will reach nearly $7.2 trillion in 2031.

So we wanted to know how health tech, including current and future technologies, can help reduce US healthcare spending and positively impact these forecasts? Here are the answers we received.

Gregg Church, President, 4medica
Twitter: @4medica

Health tech, empowered by master data management, is a game-changer in reducing healthcare spending. By effectively consolidating and managing patient data across various systems, it enhances care coordination, eliminates redundancies, and enables evidence-based clinical decision making. This streamlined approach not only drives costs savings but also improves patient outcomes and operational efficiency, revolutionizing the healthcare landscape.

Colin Banas, MD, MHA, Chief Medical Officer, DrFirst
Twitter: @DrFirst

It’s easy to lose count of all the factors contributing to the nation’s growing health expenditures. Keeping people healthier is one critical strategy, with the benefit of improving lives as well as saving costs. The health technology industry can help by connecting healthcare providers and patients with the information they need to inform care decisions. Information is power when it comes to avoiding preventable adverse events and hospital readmissions that drive up costs. Doctors can help more patients start and stay on therapy when they have insights into individuals’ medication history, prescription benefits and costs, and prior authorization requirements within their prescribing workflow. Reaching out to patients directly helps as well. For example, patients are more likely to pick up their prescriptions when they receive relevant educational information and offers of financial assistance. Technology has an important role to play in reducing healthcare spending; that benefits patients, providers, and the healthcare system at large.

Lyle Berkowitz, MD, CEO, KeyCare
Twitter: @KeyCareInc

As healthcare costs continue to rise, we have the opportunity to reshape the healthcare landscape by more effectively pairing up physicians with virtual care teams in order to expand access to quality care for all. We can start by blowing up the idea that most healthcare must be delivered face-to-face in an office setting. We must embrace innovations that let office-based physicians focus on their complex patients, while significantly increasing the delivery of healthcare by tech-empowered virtual care teams focusing on routine care. This tech-enabled collaborative model would ensure greater convenience, accessibility, quality and cost savings for patients, while helping health systems increase the number of patients they can manage.

Bob Katter, President, FDB (First Databank)
Twitter: @FDB_US

To slow the growth of healthcare costs, we will need to make more efficient use of the resources we’ve already devoted to providing care. Part of the solution needs to include helping physicians, nurses, pharmacists, and other clinicians practice at the top of their license, which will require that we reduce their documentation burden and the time they spend reviewing data to support care decisions. Too much of their time is spent searching through an enormous amount of data to find the right information for a specific patient in a specific situation, and then documenting the actions they’ve taken for that patient. Emerging data analytics technologies can help, with the caveat that any automated analysis must be clinically validated to drive safe, high-quality care. Workflows that deliver relevant, actionable, and verifiable data in less time and at the right moment will help reduce costs and improve patient safety.

Maulik Majmudar, MD, Co-founder & Chief Medical Officer, Biofourmis
Twitter: @biofourmis

While the government’s estimate that the U.S. will hit $7 trillion in healthcare spending by 2031 is staggering, it is based on the assumption of status quo care delivery approaches. Fortunately, care delivery models have evolved rapidly over the past several years, especially when it comes to home-based care. This approach has enhanced patient satisfaction while also improving clinical and financial ROI for a growing number of conditions across the care continuum. By 2031, we can expect many more patients to be admitted to their homes for hospital-level care or discharged to the home instead of an admission to a skilled nursing facility and managed with a combination of tech-enabled and in-home care delivery and support services. We will also have greater adoption of sophisticated digital disease management models for chronic conditions that help prevent exacerbations and promote greater patient engagement. Given the major workforce and aging population challenges over the next several years, healthcare spending is certainly at risk. Home-based care models that leverage technology, however, will likely have a significant cost-controlling impact that is not accounted for in the recent projections.

Calum Yacoubian, MD, Director of Healthcare Strategy, Linguamatics, an IQVIA company
Twitter: @Linguamatics

We will see a continued increase towards value-based care with better risk stratification and preventative measures made possible by AI. AI that can make an impact outside the four walls of the hospital will have a significant role to play, as social determinants of health are estimated to be responsible for most of our health outcomes. With the most unwell 5% of a population accounting for 50% of healthcare costs, the ability of more nuanced risk stratification and prevention can significantly reduce healthcare spending. There is also the potential for generative AI applications to come into their own – reducing burdensome administrative tasks, freeing up clinician time, and reducing burnout. By reducing these administrative tasks, clinicians can put the focus back on the patient and patients will have less costly outcomes and complications.

John Welch, SVP of Product, Sphere
Twitter: @SphereCommerce

Healthcare providers can help control costs by utilizing card-on-file tokenization capabilities. Tokens enable healthcare providers to store sensitive payment data against a non-sensitive value which can be used to process subsequent transactions and perform additional tasks. Further, tokens can help healthcare providers improve collections by reducing friction throughout the patient experience, simplifying the payment process and thereby reducing the time and effort healthcare providers traditionally have needed to spend supporting collection, reporting, and reconciliation activities.

Bronwyn Spira, CEO and Founder, Force Therapeutics
Twitter: @FORCETherEx

Given that 50% of US adults suffer from an orthopedic condition, musculoskeletal (MSK) care drives around $600 billion in spending a year in the US. Digital remote care management technology significantly reduces costs for patients, providers, and payers alike. This approach enables more patients to opt for outpatient surgery, saves patients time, co-pays, and lost wages while enabling more equitable access to care. Providers and payers reduce costs, increase efficiency, and better scale their workforce. The virtual care approach has been proven in multiple studies to achieve similar – or better – care outcomes, while dramatically reducing costs, such as avoidable readmissions and ED visits.

Mary Russell, MJ, BS, RN, Sr. Director, Clinical Implementation, CliniComp
Twitter: @CliniCompIntl

The projected rise in healthcare costs amplifies the need for safe, reliable and effective electronic health record systems. Clinical surveillance and population health tools are critical in reducing hospital readmissions and costly penalties. It is imperative that clinicians have access to longitudinal data for every patient to improve outcomes and decrease overall health care expense burdens on patients and hospital systems.

Kathy Dalton Ford, Chief Product & Strategy Officer, Project Ronin
Twitter: @project_ronin

Many technologies already available today can potentially reduce the nation’s overall healthcare spending. It’s now a matter of policymakers, healthcare professionals, and technologists collaborating to ensure that adopting new tech maximizes benefits and minimizes unintended consequences. Telemedicine, artificial intelligence, wearables, remote patient monitoring, precision medicine, and EHR-adjacent solutions all present numerous opportunities for cost reduction. Implementing these technologies thoughtfully and safely is critical to ensure cost savings reach patients.

Jay Ackerman, CEO & President, Reveleer
Twitter: @reveleer

With all the recent buzz and concern around generative Artificial Intelligence (AI) related to ChatGPT, it’s reasonable to have mixed reactions to such emerging technologies. Many AI and enabling technologies, however, including Optical Character Recognition (OCR), Natural Language Processing (NLP), and Machine Learning (ML), are widely established and have proven highly dependable in driving healthcare innovation. For payers seeking to transition more business to value-based care (VBC) models, AI has enormous potential to accelerate that process. The recipe for complying with industry regulations, mitigating audits and fines, better forecasting reimbursement for member populations, and accelerating the transition to value-based care in 2023 and beyond is to shift the paradigm on AI – making it the main ingredient for reducing healthcare costs, increasing productivity while improving quality care outcomes.

Dr. Jay Anders, Chief Medical Officer, Medicomp Systems
Twitter: @MedicompSys
Twitter: @medicompdoc
Host of Tell Me Where IT Hurts – #TellMeWhereITHurts

One of the ways health IT can reduce healthcare spending is by truly implementing interoperable health records. Being able to see the entire health history of a patient will streamline care, increase safety, and reduce duplicate testing and work by the providers. Technologies are now available to connect patients, homecare providers, and supervising clinicians to better manage chronic conditions at home through the use of home monitoring, clinically connected mobile devices, and point-of-care decision support capabilities. With the advent of TEFCA, QHINs, and judicious and appropriate uses of artificial intelligence, we now also have opportunities for healthcare technology to address chronic conditions and the costs and complications associated with an aging population.

Dr. Bob Booth, Chief Care Officer, TimelyCare
Twitter: @timely_care

Costs will continue to compound if we treat our healthcare like a ‘sick-care’ system, punctuating the need to get medical and mental health resources to patients early and often to prevent more costly care in the future. Improving access to medical and mental health resources while eliminating barriers to care can result in fewer, avoidable emergency department visits and hospitalizations when much less costly therapies such as outpatient care and medication would have been far more effective.

Patty Hayward, General Manager of Healthcare and Life Sciences, Talkdesk
Twitter: @Talkdesk

It can be very challenging to reduce costs in care delivery, but there are opportunities in several key support areas like patient access and revenue cycle. Better omni-channel, self-service and patient outreach, powered by AI, can make navigation easier and improve metrics like appointment no-show rates without requiring additional staff resources.

Cheryl Cheng, CEO, Vive Collective
Twitter: @vivecollective

You don’t improve what you don’t measure: To curtail healthcare spending, we must align incentives, provide proper attribution, and scaffold our fee-for-service system towards value-based care. Health tech improves monitoring and measurement capabilities for payers and providers to enable sustainable and profitable value-based care, reducing clinical costs. Health tech solutions also create persistent and scaled data feeds, which are the foundation for AI/ML tools that offload administrative and clinical workflow burden and costs.

Pawan Jindal, Founder & CEO, Darena Solutions
Twitter: @DarenaSolutions

Unlocking of healthcare data from Electronic Health Record (EHR) silos promises revolutionary strides for healthcare. While government mandates have ignited this change by endorsing secure, contemporary APIs, the actual transformation lies in our ability to enforce and harness these cutting-edge technologies. By eliminating repeated tests and unwarranted costs, we not only streamline operations but also place crucial information in the hands of providers. This, in turn, enables them to make well-informed decisions, significantly cuts down redundancies, and concurrently drives down costs. Ultimately, it’s about delivering unrivaled patient care at an optimized cost – that’s the true potential of this digital disruption in healthcare.

Brandon Clark, Executive Vice President Growth & Strategy, Equality Health
Twitter: @EqualityHealth

As the cost of U.S. healthcare continues to accelerate at a concerning rate, we are once again reminded of the unsustainability of the status quo. Fee-for-service medicine continues to represent a race to the bottom for all healthcare stakeholders. After talking in theory about value-based care for more than a decade, it’s time to finally commit to payment system reform at scale. As the quarterbacks of patient care, primary care physicians play a uniquely important role in shifting the focus of the broader delivery system from volume to value. We must equip them with the resources and support needed to transform their fee-for-service practices into hubs of value-based transformation. Technology can be a key enabler of this shift by organizing the mountains of fragmented data that PCPs face daily into prioritized workflows and cleanly organized task lists that can be managed by the entire practice team, reducing the risk management burden on the provider in the process.