How Insurance Changes Have Affected Health Administration

In a 2011 report for the National Institutes of Health, Sara Rosenbaum writes, "The Affordable Care Act is a watershed in U.S. public health policy ... a near-universal guarantee of access to affordable health insurance coverage, from birth through retirement." Along with that guarantee come significant changes in health administrators' responsibilities as they adapt to the new circumstances created by the law. Here are a few of the ways the ACA has impacted the field of health administration.

Increased Demand for Care

How Insurance Changes Have Affected Health Administration_Image via Flickr by Leader Nancy Pelosi

Image via Flickr by Leader Nancy Pelosi

A Gallup poll found that the rate of uninsured Americans fell to 11.9 percent in the first quarter of 2015, down from a high of 18 percent in the fall of 2013, before the ACA took effect. As a result, there are considerably more patients in the United States' healthcare system than there were just a few years ago. This has led to increased demand for doctors, nurses, and medical support staff, and it has put additional pressure on health administrators to stretch existing resources.

Gallup also noted that the greatest increases in coverage are among minority and low-income Americans, who may not be able to pay for the healthcare they need. This presents an even greater challenge to health administrators to find ways to provide patients with high quality care in spite of financial limitations.

Compensating Quality

Health administrators are also participating in a shift in compensation methods for healthcare providers. Traditionally, doctors have been paid on a fee-per-service basis, regardless of outcome. The ACA creates a value-based model in which providers are paid based on the quality of the care they provide. While the fee-based compensation model is still dominant, insurers and employers are increasingly moving to the new system. Despite initial fears that this change would mean a drop in income, Forbes reports that doctors' compensation is on the rise.

Focusing on Technology

The ACA and related healthcare legislation, like the Health Information Technology for Economic and Clinical Health (HITECH) Act, have catalyzed the role of technology in healthcare. To facilitate compliance with new health IT regulations, health administrators may be responsible for the management of electronic health records (EHR) and other digital systems. This means health administrators with an understanding of health IT and experience working with technical staff may be at an advantage as healthcare providers and their professional partners transition from analog to digital systems.

Lower Costs Through Prevention

One of the ACA's objectives is to slow the growth of healthcare costs by focusing on prevention. Health administrators are taking the lead in finding ways to implement this shift in priorities. The Centers for Medicare and Medicaid Services report that this approach is yielding results. The rate of readmission for Medicare beneficiaries has been on a steady decline since the relevant portions of the ACA went into effect in 2012.

Health administrators are at the forefront of the new era in American healthcare brought on by the ACA. The law has unquestionably created challenges, and administrators are responding by learning new skills and finding creative solutions that benefit both patients and providers.

For more information please visit USC's Executive Master of Health Administration Online program. 

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