Deloitte’s life sciences and health care thought leaders lay out their vision for health in 2040

My Take

Deloitte’s life sciences and health care thought leaders lay out their vision for health in 2040

By Doug Beaudoin, vice chairman, US Life Sciences & Health Care leader, Deloitte LLP

Thought leaders from across our life sciences and health care practice will be in Orlando later this month for our bi-annual Industry Forum. During this two-day event, we provide our leaders and senior professionals with deep insight into industry trends. This year, we will lay out our vision for the future of health and the role that we expect Deloitte to play in guiding and convening our clients—and more broadly the life sciences and health care sectors—through some of the major changes that we expect will unfold over the next 20 years.

Deloitte is uniquely positioned to help make this vision a reality. Our clients run the gamut from health systems and health plans, to biopharmaceutical companies and medical device manufacturers, to sophisticated and emerging technology and consumer-focused companies, to state and federal regulators. We are working to bring all of these groups together to solve complex issues and to redefine the meaning of—and transition to—health and well-being.

The health systems, health plans, and life sciences companies of tomorrow should continue developing and implementing strategies to participate in this new health and wellness-oriented ecosystem. Organizations that don’t prepare for the future now could lose their position to better-prepared competitors or outside companies that are looking to break into this industry.

Why is the health ecosystem changing? The US health care system has served us well for generations. We have made tremendous advancements in our ability to treat illnesses and injuries and to cure diseases. But we are now on the cusp of being able to tap into enormous amounts of patient data that we expect will help to usher in a new era of health that focuses on early detection and prevention. The future of health that we envision will be driven by greater data connectivity, radically interoperable data platforms, and unprecedented levels of consumer engagement.

My colleague David Biel, our consulting leader for health care, says the future of health is almost a misnomer. Calling it “the future of wellness,” he explains, might be more apt as we move from a health economy that revolves around reactive interventions to one that is driven by proactive interventions.

Here’s a look at what some of our leaders are saying about the future of health and the likely impact it will have on our clients, the US health system, themselves, and their families:

• Steve Burrill, vice chairman, US health care leader: The health care industry of today is built around a premise that we will provide high-quality care when you become sick or injured. We know that some illnesses can be prevented, and a focus on wellness and the management of chronic conditions can make a big difference in people’s health and longevity. While people will still get sick 20 years from now, we expect the health system of the future will be able to manage their conditions more effectively and prevent many people from developing diseases. The health of US citizens, and the health of the US economy of the future, will be greatly enhanced once we move away from a system that doesn’t go into effect until there is an illness or injury. The future of health will focus on wellness, prevention, and the active management of chronic conditions.
  
• Mike DeLone, vice chairman, life sciences leader: While we talk about where health might be 20 years from now, I think that the future of health is well underway. We actually might be 10 years into it already. I don’t think we have any clients that aren’t at least thinking about the direction health is taking and figuring out how they want to position themselves. In life sciences, the data platforms are more sophisticated than they’ve ever been, and the clinical breakthroughs are accelerating. Organizations that aren’t working to change their business strategy to keep pace with the future of health probably won’t have a viable organization 10 or 20 years from now.
• David Betts, principal, life sciences and health care: We expect consumers will be at the center of the health universe by 2040. That will likely fundamentally transform the way we think about the supply chain, finance, data, and the tools we use to engage individuals. Our clients should start planning for the future now. The bets they make today will likely have implications 20 years from now and beyond. They will likely need to invest in technologies that help them engage consumers differently and create a frictionless experience.
• Sarah Thomas, director of the Center for Health Solutions: I can imagine coming downstairs in the morning and having a virtual visit with my doctor. But maybe I didn’t set up that appointment. Instead, a sensor in my clothes, or in my bathroom, or even in my bloodstream might have determined a possible issue with one of my biometric measures…and a message was automatically sent to my care team. This sort of proactive health could help identify and treat illnesses before symptoms arise. Imagine being able to prevent someone from developing diabetes or mental illnesses. Most of the chronic conditions that are the major drivers of cost today can be dealt with proactively in the future of health.
• Amy Kroll, principal, health care sector leader for the risk and financial advisory practice: There is a whole set of industry disruptors, especially in the technology sector, and they are looking to solve some of the problems that exist in health care. They recognize the importance of making health care better, and they understand the opportunity. So, there is pressure on the health care ecosystem from the outside. These disruptors want to access and use patient data in ways they've already proven successful in other industries. Technology and consumer-focused companies are positioned to disrupt health care and transform it—along with us or for us—if the current health care ecosystem doesn't transform itself. 

My colleagues and I got involved with the health sector because we wanted to help make it better. We got into consulting to help transform the overall system. What excites me about the future of health is the idea of leaving a legacy to my children and to future generations. I would like to see my kids and other kids grow up in an environment where health and life sciences companies are completely focused on their physical and emotional well-being. My kids are already interacting with technology every day. It seems natural that these interactions will be expanded to help them maintain their well-being as they become adults.

The future of health is going to have a profound impact on the health and life sciences sectors. While 2040 might seem like a far-off vision, it’s not. I’ve been outlining our vision for the future of health in My Takes since the beginning of the year. We are urging our clients to start planning now. They should consider investing in technologies that will help eliminate friction in the health system and allow them to engage more effectively with consumers.

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In the News

CMS finalizes policy to reduce costs, paperwork

The US Centers for Medicare and Medicaid Services (CMS) has issued a final rule to reduce regulatory burdens on clinicians and facilities that serve Medicare and Medicaid beneficiaries. The rule, called the Omnibus Burden Reduction Final Rule, “strengthens patient safety by removing unnecessary, obsolete, or excessively burdensome health regulations on hospitals and other health care providers,” the agency explained in a September 26 prepared statement. CMS expects the rule will save providers 4.4 million hours a year in paperwork. For every hour a typical physician spends providing direct care to a patient, two additional hours are spent on administrative tasks, according to a 2016 report published in The Annals of Internal Medicine. CMS predicts the changes could save $843 million in its first year and more than $8 billion over the next decade.

The final rule contains several policy and procedure changes, including:

• Allowing multiple hospitals within a health system to create unified Quality Assessment and Performance Improvement (QAPI) and infection-control programs. Existing rules require every Medicare-certified hospital within a system to have a separate staff for such programs.
• Reducing the frequency of policy reviews and program evaluations—from annually to once every two years—that rural health clinics and federally qualified health centers are required to conduct.
• Reducing required hospital emergency preparedness reviews from annually to every other year.
• Allowing clinicians to transmit orders for X-rays electronically, via telephone, or in writing. Existing rules require all orders to be written and signed.

The final rule was published in the Federal Register on September 30.

(Source: CMS, Omnibus Burden Reduction [Conditions of Participation] Final Rule CMS-3346-F, September 26, 2019)

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CMS releases 2020 Medicare Advantage and Part D plan details, expects lower premiums

On September 24, CMS said it expects premiums for Medicare Advantage (MA) coverage to decline in 2020. CMS predicts average monthly MA premiums in 2020 will be at their lowest level in 13 years.

CMS also outlined 2020 benefit and cost-sharing information for MA and Part D plans, including:

• Of the 60 million Americans enrolled in Medicare, 24 million are expected to enroll in an MA plan in 2020—up 30.6 percent from 2017
• The average monthly premium for an MA plan is expected to fall 14 percent—from an average of just over $26 in 2019 to an estimated $23 in 2020
• CMS estimates 1,200 more MA plans (benefit offerings within a geographic area) will be available in 2020 than in 2018
• Among counties, the number of available MA plans is expected to increase from 33 in 2019 to 39 in 2020—an overall increase of 49 percent since 2017
• In 2020, the average monthly premium for a basic Part D plan is expected to be $30, which is the lowest since 2013

The agency also expects that 250 plans will offer access to new supplemental benefits such as home-care services, meal delivery, and transportation to an estimated 1.2 million enrollees who have chronic conditions. Plans can offer these newly approved services in addition to the primarily health-focused supplemental benefits offered by most plans.

(Source: CMS, Trump Administration Drives Down Medicare Advantage and Part D Premiums for Seniors, September 24, 2019)

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CMS releases final method for calculating Medicaid DSH cuts

On September 23, CMS released its final method for calculating annual Medicaid Disproportionate Share Hospital (DHS) pay cuts. The cuts, which will impact federal payments to states from 2020 through 2025, are expected to go into effect in mid-November. The Affordable Care Act (ACA) included Medicaid DSH cuts with the rationale that increased Medicaid coverage through state-expansion efforts would reduce uncompensated care for hospitals (see the February 26, 2019 Health Care Current).

This final rule builds on the agency’s 2017 proposed rule, which seeks to “account for relevant data that was unavailable to CMS during prior rulemaking for DSH allotment reductions.” Under this calculation, the federal DSH allotments are expected to decrease by $4 billion in 2020 (see the June 11, 2019 Health Care Current). In each subsequent year through 2025, DSH reductions are expected to be $8 billion.

(Source: CMS, Medicaid Program; State Disproportionate Share Hospital Allotment Reductions, final rule published September 25, 2019)

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House surprise-billing proposal would save $21.9B in 10 years, CBO says

The House Energy & Commerce Committee’s surprise-billing fix, called the No Surprises Act, would save $21.9 billion over 10 years (see the June 4, 2019 Health Care Current), according to a September 18 report from the Congressional Budget Office (CBO). The estimate includes both a projected $20.9 billion revenue increase and a $1 billion reduction in direct spending. CBO also projects lower payments to facilities where surprise medical bills are common, lower in-network costs for consumers who use in-network care, and a 1 percent drop in premiums. CBO expects this legislation, if enacted, would help reduce premiums because charges for out-of-network services would be based on median in-network rates, which are generally less expensive.

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FDA releases new patient materials on biosimilars

On September 23, the US Food and Drug Administration (FDA) released Biosimilar Basics for Patients, a new set of resources that gives patients an overview of biosimilars and their use. These resources were developed to help consumers understand biosimilars and determine how they compare to biologic medications in terms of cost and effectiveness. FDA developed this resource as part of a commitment to the Biosimilar Action Plan to improve communications around biosimilar use among patients and providers.

(Sources: FDA, Biosimilar Basics for Patients, September 23, 2019; The Center for Biosimilars, FDA Releases Biosimilar Educational Materials for Patients, September 23, 2019)

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AMA survey reveals higher physician participation in ACOs and medical homes

More physicians are participating in Accountable Care Organizations (ACO) and medical homes, according to the American Medical Association (AMA) Physician Practice Benchmark Survey. Of all physicians surveyed, 53.8 percent participated in at least one type of ACO in 2018, up from 44 percent in 2016. Increased participation rates were seen in all types of ACOs. Physicians reported belonging to the following ACOs:

• 38.2 percent belonged to a Medicare ACO
• 26.3 percent belonged to a Medicaid ACO
• 39 percent belonged to a commercial ACO

The survey also reported a 32 percent increase in physician participation in medical homes in 2018, up from 25.7 percent in 2016. Other trends highlighted in the survey include:

• Multi-specialty practice physicians were more likely to participate in an ACO or medical home than solo practitioners
• Physicians in hospital-owned practices had higher participation rates in Medicare ACOs and medical homes (20 percent), Medicaid ACOs (18 percent), and commercial ACOs (11 percent) compared to those in physician-owned practices
• Practices with primary-care physicians had higher physician-participation rates in medical homes and each type of ACO compared to practices without primary-care physicians

(Source: American Medical Association, Physician Practice Benchmark Survey, 2018)

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Older adults say they are ready to age well, but are concerned about navigating care

Many older Americans have concerns about their ability to navigate the health care system despite saying they feel prepared to age well, according to a recent poll from Anthem, Inc. and the advocacy group National Association of Area Agencies on Aging (n4a). Of the adults surveyed, 79 percent said they felt prepared to age well. Despite this response, participants said they worried about their health progression and their understanding of insurance benefits.

More than half of older adults surveyed (59 percent) said they had trouble navigating at least one aspect of the health care system, such as understanding treatment options or knowing how to effectively communicate with their providers. Further, this trend is more prevalent among women (65 percent) than men (52 percent). Overall, older adults did express confidence in navigating some areas of the health care system, such as understanding available insurance coverage plan options (84 percent) and identifying in-network providers (88 percent).

The survey also revealed the following trends:

• 42 percent of older Americans said they would feel more confident about managing their health if they had a better grasp of their insurance benefits
• 77 percent of women and 84 percent of men said they have been provided with the relevant information needed to make decisions about their health insurance
• To navigate their care effectively, many older adults rely on resources such as conversations with their providers (43 percent) or patient navigators (23 percent).

(Source: Anthem, Inc., 8 in 10 Older Americans Believe They Are Prepared to Age Well, But Need Help Understanding Their Benefits and Navigating the Health Care System, September 25, 2019)

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Breaking Boundaries

Could a combination of growth hormones and diabetes drugs slow the aging process

Spoiler alert: The answer to the headline is “maybe someday.” After decades of research into slowing or reversing the aging process, a team of scientists published a study detailing some promising evidence. They discovered a combination of three drugs that might have some effect in reversing the epigenetic clock—a measure of someone’s biological age and health. The team did not set out to halt or reverse aging. They initially wanted to evaluate the human growth hormone’s effects on the thymus (the gland behind the sternum that produces a hormone that stimulates the development of disease-fighting T-cells). The thymus is only active until puberty, then it starts to shrink as we age.

The researchers set out to determine if growth hormones could stimulate thymus function in middle-aged men. To combat the side-effects of growth hormone, which includes dangerously increasing blood-sugar levels, the team added two diabetes drugs. One drug was DHEA, a hormone secreted by the adrenal gland, and the other was metformin, which reduces blood-sugar levels. The study showed that taking this mix of drugs for one year decreased the chronological age of participants by 2.5 years, as measured by distinctive DNA markers. In addition, the team saw some signs of an improved immune system. Metabolites in the participants’ blood suggested that the kidneys had begun filtering toxins from the blood more efficiently.

The sample size of this study was small—just nine males participated. But the team, along with other scientists who are researching the effects of aging—appear optimistic about the results. More studies will need to be done to build the evidence, and researchers will want to learn how the drugs are working. One pharmaceutical company is planning a larger trial based on the results.

In the meantime, those of us who want to live longer and stay healthier should follow the same advice we’ve known for years: don’t smoke, eat a healthy diet full of whole, unprocessed foods, get enough sleep and physical activity, and build a strong social network.

(Source: George M. Fahy et al, Reversal of epigenetic aging and immunosenescent trends in humans, Aging Cell, September 8, 2019)

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