Report Identifies Top 10 Industry Concerns for 2014

By Mia Burns (mia.burns@ubm.com)

Ten pressing issues are facing the U.S. health sector in 2013, according to an annual report from PwC’s Health Research Institute. The company has released Top Health Industry Issues for 2014 in which executives identify the top concerns, including the need to adjust to empowered consumers, rapid innovation, and increasing competition from non-traditional players. The report includes the results of a survey of 1,000 U.S. consumers and interviews with health industry leaders that provide insights into the emerging new health economy.

The implementation of the Affordable Care Act is only one of the factors forcing a rapid reshaping of the $2.8 trillion U.S. healthcare industry in 2014, according to PwC’s Health Research Institute.  In addition, the report notes that much of the health industry has accepted that reform is here to stay – and forward-looking executives are making decisions based on a post-ACA landscape that has altered the provision of insurance and the delivery of care.

“In putting together our Top Health Industry Issues for 2014, PwC’s Health Research Institute (HRI) relied on input from our consultants across the health sector, as well as industry executives and individual consumers,” says Ceci Connolly, managing director Health Research Institute, PwC. “We polled 1,000 individuals to understand how they interact with the health system and what factors would alter their behavior. HRI also interviewed executives at pharmaceutical and life sciences companies, as well as healthcare providers, insurers and large employers.  With the backdrop of the Affordable Care Act and the rapidly changing healthcare landscape, these 10 issues stood out. Our research is informed by PwC’s industry experts.”

According to HRI, 10 issues stand out as the top focus for the health industry in the year ahead:

  • Price transparency is growing as purchasers – consumers and employers – are demanding and receiving more information on cost and quality
  • Employers are exploring new health insurance options through private exchanges
  • New regulation aims to eliminate counterfeit medications in the drug supply chain
  • States are turning to managed care to help contain Medicaid long-term care costs
  • All healthcare companies need to rethink their roles and business models in the new health economy
  •  Healthcare companies will need to change their rules on innovation — embrace “fail fast” approaches
  • Social, mobile, analytics, and cloud technologies are driving new health industry business models
  • Corporate venture capital is picking up the slack as traditional venture funding slows for pharmaceutical start-ups
  • Technology is redefining the healthcare job market
  • Drug makers must rethink their clinical trial research methods, embracing alternative approaches

“While health insurance exchange implementation is driving headlines today, in reality the next 12 months will be marked by how well the industry addresses a range of core business challenges,” said Kelly Barnes, PwC’s U.S. health industries leader. “Our annual Top Issues report identifies the main concerns facing the health industry in 2014. Businesses must address rapid innovation and competition from non-traditional players, but above all they must respond to empowered consumers as customer-centric transformation sweeps healthcare.”

Regarding examples of non-traditional players, Connolly told Med Ad News Daily, “We’re seeing retailers, electronics companies, and new players competing with traditional healthcare organizations. In fact, HRI’s Top Issues consumer survey found that 23 percent said they have gone to a retail clinic and 73 percent of them said they will go back to one in the future. Additionally, in HRI’s recent report on innovation in the medical technology sector, we highlight 18 companies, primarily from the telecommunications and consumer electronics sectors, that have entered the medtech space. Customer experience in the pharmaceutical sector: Getting closer to the patient, another HRI report includes case studies of three non-healthcare companies that have developed products to address patient needs, including a technology company, a clothing developer and a non-profit organization.”

“These issues don’t just exist for a year – but mature with the industry – and remain important over time,” Connolly says. “Some issues will continue to evolve, including rapid innovation, competition from non-traditional players and most importantly, the customer-centric transformation sweeping healthcare.”

PwC’s Health Research Institute Identifies the Top 10 Health Industry Issues for 2014

Posted: December 2013


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