Rx for Transformation

Focusing on value-based healthcare

Prasanthi Potluri

Prasanthi Potluri

Editor Asian Hospital & Healthcare Management


Factors such as ageing populations, rise in spending by organisations and healthcare delivery centres, rise in income levels, ups and downs of countries' per-capita GDP, etc. are driving healthcare costs.


According to the Centers for Medicare & Medicaid Services (CMS), total US healthcare costs are projected to reach nearly US$4.8 trillion by 2021. According to SwissRe's projections, Asia-Pacific's healthcare costs are expected to reach US$2.7 trillion by 2020.

In the US the Patient Protection and Affordable Care Act (PPACA) passed on March 23, 2010 to directly regulate healthcare providers, insurance companies, individuals and employers. The PPACA will guide 34 million more non-elderly Americans obtaining health insurance by 2021.

In cooperation with the Centers for Medicare & Medicaid Services (CMS), the Act aims to reduce payments for hospitals by increasing the list of applicable conditions for fiscal year 2015. These trends have increased the pressure on all healthcare industry participants to move on to customer-centric, connected and valuebased healthcare.

New strategies are already emerging for a change in the healthcare delivery system and trying new approaches by introducing and implementing new digital technologies would reduce cost and expand the reach of healthcare services. Blue Shield, in California, for example, has tried to improve outcomes for knee and hip replacement surgeries for California Public Employee Retirement System (CalPERS) retirees by identifying 16 facilities and covering all the procedures.

To succeed in this new era, organisations need to bring fundamental changes to their ways of working and focus on improving processes that have a bearing on the outcomes for a patient. Healthcare players will need to enhance competencies, incorporate technologies that enable connected care and drive a culture of evidence-based decision making across the spectrum in order to transition from a fee-forservice to fee-for-outcomes health delivery systems.

The cover story in this issue by Phillip Polakoff, Senior Managing Director and Chief Medical Executive, Health Solutions Practice, FTI Consulting, US, elaborates on the need for a balanced healthcare transformation. Furthermore, the story analyses how the US and Asian healthcare sectors are facing problems of unsustainable costs and explains strategies that could possibly address these challenges.