Focus on state capitals
State lawmakers and policymakers likely will make critical decisions if many health reforms are enacted. This conforms with a broader trend toward state autonomy in healthcare policy that has gained momentum over the last year. Health organizations, particularly those doing business in multiple states or with customers in multiple states, should consider beefing up compliance and local advocacy efforts.
In an unsettled policy environment, health organizations should focus on understanding how potential policies would specifically affect their business projections, and construct volatility ranges for those policies. They should work to understand fixed costs and federal and state policy decisions’ impact on margin.
Slim down costs
Health organizations should work to understand their costs, determining what it truly costs to achieve a particular health outcome. Many health organizations struggle with allocating overheads; the more progressive ones have moved to activity-based costing. Another benefit of understanding the cost is more precise and defensible pricing in the era of increased scrutiny.
Health organizations also should attempt to standardize costs by studying the variability in the cost of delivering a health outcome and then seeking to eliminate it through evidence-based medicine, standardization and automation. Finally, health organizations should consider examining their fundamental cost structure and optimizing their portfolios to free up or fill up stranded capacity” and become more fit for growth.
Health organizations should revisit or consider businesses that are tightly tied to the ACA repeal/replace debate. For example, for payers, this might mean considering avenues such as workers’ compensation, voluntary insurance, or provider enablement or group member advocacy.