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Where Were You When Healthcare Reform Became Reality?

February 15

There are those things which, when they become reality, change your life forever. Computers, World Wars, the Internet, even the iPhone. It's not possible to go back. Healthcare Reform-or the Patient Protection and Affordable Healthcare Act-will change all our lives, but those of us who seek to hire the right employees to deliver this nation's healthcare will be among the most affected.

The many heated discussions around the reform centered mostly on how we would pay for it-not how it would fundamentally change healthcare as we know it. Few mentioned that healthcare accounts for 18.9% of the US Gross Domestic Product (GDP) and that the current way we provide healthcare was not sustainable. As a note of comparison, the World Health Organization (WHO) ranks France as the world's best healthcare delivery system and healthcare accounts for less than 5% of their GDP.

We needed healthcare reform. I don't look at it as an entitlement program, but rather something we needed to do for society as a whole. I also feel strongly that tackling the emotional and convoluted aspects of how healthcare is actually administered here in the US is the smartest thing we can do to ensure our economic viability as a nation.

I believe the bill that finally managed to become law is a mess, but it is a start in an impossibly messy quasi business. I say quasi because healthcare has never been able to pull away from its charity roots and into what must become a business.

We have attempted to sustain a business model that provides just about every type of service, from more locations than necessary, and providing those services to almost anyone with little regard as to ability to pay. Apply this faulty methodology to the fact we only provide these services to some, when a situation becomes so bad, and costly, that as a quasi charity, we can no longer avert our eyes.

Healthcare reform will hit hard the bottom line of most acute care facilities. Since 63% of every budget dollar within those facilities is attached to salary, wage and benefits, it is inevitable that the focus of reform will stop at the door of human resources. Healthcare reform is going to also mean a business boom to many other providers, and that is going to cause opportunities of growth and the creation of additional healthcare jobs and competition among those hiring.

In a modest attempt to over simplify this unwieldy subject, let me just say, the bill is designed to provide avenues for individuals to attain insurance for more (almost all) people, including those who cannot afford coverage and those with pre-existing conditions. It also stops insurance carriers from dropping coverage for individuals who become ill. That sounds simple and reasonable, but when the lawmakers met behind closed doors, everything was anything but simple. Insurance companies, pharmaceutical giants, the American Medical Association, long-term care providers and the American Hospital Association may not have been in the room physically, but they were certainly in the room.

Avoiding crippling any one industry and their billions of dollars in profits became as much of the goal as actually providing universal coverage. And that will result in healthcare providers having to squarely face the difference between charity and business and everything will be scrutinized for the tiniest portion of fat.

It is impossible for anyone to know exactly how all this will change the way we recruit and retain but my best guess includes:

  • Healthcare reform will provide Medicare benefits to 25% more people and Medicaid will add 15 million more recipients by 2014. The balance will be able to acquire insurance from "exchanges". Just the fact that so many more Americans will be able to afford to actually attend to their health, will result in people buying more healthcare services, driving higher census' and more tests. But at what price? Acute care systems are already struggling financially, but now more people will be paying prices for services that often times will be lower than what the service actually costs. These payment schedules will have been negotiated at the lowest common denominator and facilities that run efficiently will make money and those that don't will lose money. With employee salary, wage and benefits the largest line item in a healthcare system's budget, an emphasis will be on the millions of dollars associated with recruitment and retention. Get ready- human resources just became the hottest area for efficiency.
  • Because it is not feasible to provide all services to all people from all locations, hospitals will be forced to choose what they will offer and what ones are not a good fit financially with the population they serve. This will mean some facilities will quietly begin to close areas such as obstetrics, pediatrics and emergency rooms, while others will be expanding them in parts of the city where they will be consumed at a profit. Layoffs and realignments of individuals will be inevitable. That will change which healthcare delivery professionals we recruit for at each location, which ones keep their jobs and who will receive pink slips.
  • One of the nicest parts of this new reform is that much of it is aimed at preventative care. Obviously a healthy American is a cheaper one to insure. With this new legislation, insurers must provide services such as immunizations, cancer screenings including colonoscopies and mammograms, as well as routine check-ups. You don't have to think hard to figure how this will impact recruitment, but the question becomes where to find enough mammographers and lab professionals and what other providers will wade into this profitable field.
  • In the small print, the reform act allows employers to rebate up to 30% of an employee's total insurance plan if they embrace wellness initiatives such as smoking cessation, losing weight and seeing a health coach. Whether it is healthcare delivery systems who will offer these preventive programs or someone new who comes into the space, the focus is monumental in how we view healthcare. We have gone from just treating disease to preventing it and become a healthier nation. This is true reform and it will affect not only who we hire but the types of benefits we provide our employees.
  • Home Health will have more business than they will be able to serve. As part of the Patient Protection and Affordable Healthcare Act, a relatively unnoticed section, the Community Living Assisted Services Support Act (CLASS), will provide payments to individuals who previously depended on unpaid care givers. These payments will be on a per diem basis and will not be enough to provide daily nursing care, but will provide enough for some home health care. This will be in addition to the millions more Americans who will be covered by Medicaid and Medicare. Health Systems will scramble to augment their homecare agencies, and competition for these dollars-and the people who provide the services-will be great.
  • Long term care is expensive and this new offering of a basic insurance plan will not cover individuals who seek long term care that must be augmented above Medicaid and Medicare standards. Still, there will be millions of individuals seeking "Medicare Beds". Long term care continues to be the fastest growing segment of healthcare and as the Baby Boomers, of all financial means, continue to retire in ever increasing numbers, the fight for talent at the long-term bedside will be great.
  • All this reform will create paperwork that won't really be paperwork. The new reform bill, seeking billions in savings to help pay for all this, has mandated that all medical records be digitalized by 2015. This is a huge undertaking and one that is going to be supplemented financially by the government, so the push to do it quickly and efficiently will be paramount among healthcare leadership. Exacerbating the hiring challenges will be the fact there are few schools graduating the professionals needed to complete this task.
  • Paperwork and hiring doesn't stop there. In addition to the actual records going digital, there will need to be thousands of people hired to simply do the insurance "paperwork". The State of Florida announced recently they will need to hire an additional 1,000 workers to process all the newly insured. Multiply that times fifty.

President Obama told the American Medical Association that "to say it as plainly as I can, health care reform is the single most important thing we can do for America's long-term fiscal health. That is a fact." This reform act will stimulate the economy along the lines of Franklin Roosevelt's New Deal. Almost immediately, it is expected some 400,000 jobs will be created by small companies who will be able to expand because they will not be paying as much for healthcare insurance for employees.

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