Inside the healthcare policy changes that affect doctors in 2022

Jonathan Ford Hughes | December 03, 2021

In 2021, physicians saw a sea change in healthcare. They witnessed the rise of a deadly pandemic, the rally of scientists and researchers to develop groundbreaking vaccines and therapeutics in response, and a shift in social consciousness that highlighted inequities within the system itself. 

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The U.S. Capitol at sunset

If it passes the divided Senate, President Biden's Build Back Better bill will affect physicians and medical practice.

Looking ahead to 2022, it appears the theme of sea change is likely to continue.

On a policymaking level, several high-impact forces are in play. CMS continues to roll out its price-transparency initiatives. The Biden administration is pushing its Build Back Better bill. Inflation—and how the Federal Reserve responds to it—may affect healthcare prices. And cybersecurity, one of healthcare’s elephants in the room, continues to loom large and dangerously.

Price transparency

In an effort to end surprise hospital bills, CMS kicks off a new hospital price transparency initiative on January 1, 2022. The new initiative is largely a compliance measure. CMS regulations have required hospitals to enhance price transparency since January 2021, which includes posting all pricing information online, annually, in machine-readable formats.

A July report, however, indicates that hospitals are lagging. PatientRightsAdvocate.org randomly sampled 500 US hospitals and found that 5.6% had complied with the mandate. Among the 471 hospitals that were not compliant, the majority had attempted to post machine-readable data, however, the data were incomplete.

In November, the stakes for getting it right got a bit higher for hospitals. Failure to comply will cost smaller hospitals (those with 30 beds or fewer) $300 per day. Hospitals with bed counts greater than 30 face an additional penalty of $10 per bed, per day, not to exceed a daily limit of $5,500. These fines take effect on January 1.

As a result, doctors may encounter patients who are more educated healthcare consumers. It’s also possible they may encounter some pushback if patients begin price-checking imaging, prescription drugs, and/or procedures. 

Build back better

President Biden’s social policy bill, the Build Back Better Act, passed in the House last month. However, the bill faces an uphill climb in the Senate, which is split evenly between Republicans and Democrats. If the bill manages to pass, it will expand healthcare coverage to an estimated 4 million uninsured people who do not have access to Medicaid. The legislation would also lower premiums for about 9 million Americans via a broadened premium tax credit. Finally, the bill would grant additional access to hearing care via Medicare.

Earlier versions of the legislation had called for aggressive prescription-drug price reform. The bill has since softened a bit. In the current version, the amount of drugs eligible for negotiation is smaller, as are the potential discounts. Additionally, new drugs would not be eligible for negotiation. 

Build Back Better also contains several climate initiatives aimed at lowering greenhouse gas pollution, which would translate to cleaner air and hopefully fewer instances of pollution-related disease. The target is to cut greenhouse gas levels by more than 1 gigaton by 2030. 

Should the bill become law, it’s a safe assumption that physicians who see a great deal of Medicare and Medicaid patients (and let’s be honest, who among you doesn’t?) may begin to see more. While this may be great for patient access to healthcare, as well as your patient volumes, it may also put a strain on a healthcare system that’s contending with a primary care shortage.

Inflation

You see it every time you go to the grocery store: Things cost more than they did a year ago. About 6.2% more, according to the Brookings Institute. Thanks to inflation, your dollar has less buying power than it did in 2020. Interestingly, one of the few areas of the economy where this trend does not apply—at least currently—is healthcare.

According to a recent report from Altarum, a non-profit consultancy, their healthcare price index stayed steady at about 2% in October—that’s year-over-year and month-over-month.

“Healthcare price growth remains lower than expected given continued elevated economy-wide inflation, as measured by both the consumer price index (CPI) and producer price index (PPI), which continued to set records at 6.2% and 8.6% respectively in October,” the Altarum researchers wrote.

Why? Do the laws of economics not apply to healthcare? A recent Vox analysis indicates that it may be only a matter of time before inflation hits healthcare too. The same forces driving inflation in the broader economy are also in effect within healthcare. For example, supply-chain and labor issues. Essential supplies are tougher to obtain, and so is help. A November FitchRatings report warned credit-issuers that the healthcare industry may lose money and/or raise their prices, due to both.

“Healthcare providers across numerous settings are challenged by the scarcity of workers, which is driving wages higher and leading to greater use of more expensive temporary help,” Fitch wrote.

How the Federal Reserve and the Biden administration respond to inflation likely will affect physicians—and not just at the grocery store, the gas pumps, or when trying to get work done on their homes. With profits down, it’s possible physician-employers will push to increase patient volumes, all while levels of support staffing are low, and burnout rates are high. Even the credit-rating folks at Fitch see this.

“Hospitals are experiencing staff burnout and high rates of employee turnover,” they wrote. “Senior housing, skilled nursing and some in-patient behavioral health operators have indicated they do not have sufficient staff to meet demand, resulting in lower new admission rates.”

Cybersecurity

Guess which industry has the highest average cost for cybersecurity breaches for 11 years running? According to a recent IBM cybersecurity report, it’s healthcare. On average, every time a healthcare organization gets hacked in 2021, it costs about $9.2 million to recover—that’s a 29.5% increase over last year.

Ransomware continues to be a thorn in the side of healthcare organizations. For example, in August, the FBI warned the industry about Hive ransomware, which cybercriminals use to attack hospital networks. After gaining a foothold in an organization, cybercriminals will use several tactics to receive ransom payment, including shutting down a healthcare system’s network, threatening to sell or disseminate patient information, or a combination of both. 

Doctors should care about cybersecurity because they are often the first line of defense in attacks such as these, standing between the criminals and their patients. These types of attacks often begin with a phishing email, which prompts the user to click a link or provide valuable information that grants the criminals access to a network. Your IT department probably filters many of these attack attempts out of your email, but every now and then, one slips through. Your ability to spot and report these types of emails could protect your patients from identity theft.

From a policy standpoint, not much has changed since HIPAA passed in 1996. But the internet, and the cybersecurity landscape, definitely have. As the rate and severity of cybercrime in healthcare increase, be on the lookout for additional regulation.

TL;DR

We have our eyes on the following healthcare policy changes in 2022:

  • Price transparency: Will patients become more price-conscious, educated healthcare consumers and push back against healthcare fees?

  • Build Back Better: If the bill passes, and it expands access to healthcare, will that exacerbate the strain on primary care providers?

  • Inflation: Will inflation eventually catch up with healthcare, and if/when it does, how will that affect patient-volume pressures on doctors?

  • Cybersecurity: Will we see additional regulation to curb the effects of cybersecurity attacks on the healthcare industry?

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