reimbursement Archives - Business Intelligence

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ACA vs. AHCA and its Impact on the Medical Device Industry

Thanks to the ongoing healthcare bill debate between the Affordable Care Act (ACA) and the American Health Care Act (AHCA), the market space for health care in the US has been the center of attention across the globe. In the year 2010, a new healthcare bill named the affordable care act, more commonly known as the Obamacare, was brought into effect by the president of the US. The affordable care act was introduced with the objective to improve health care in the US by making health insurance coverage accessible and affordable to all. Through the affordable care act, the United States was one of the few developed countries to offer universal health care to its residents.

However, when the political reign shifted to president Trump’s administration, the Republican party introduced a legislation to repeal the affordable care act and replace it with the American health care act, with certain reforms. While the AHCA plan looms under the clouds of uncertainty, groups of doctors, nurses, hospitals, and patients have contested against the GOP’s health care plan to repeal Obamacare with the AHCA. One group missing from the opposition against the new health care bill are the medical device manufacturers organization.

What is the difference between the Affordable Care Act and the American Health Care Act

The American health care act, the GOP alternative health care bill that aims to repeal Obamacare (ACA), has been introduced with certain amendments to the latter. There are certain similarities and differences between the affordable care act and the AHCA; let’s have brief look at each. The similarities between the ACA and the AHCA are as follows,

  • The pre-existing medical conditions such as pregnancy or cancer will still be covered under the new coverage options, and insurancea2 companies cannot refuse the coverage for the same
  • Both the legislative pieces, the affordable care act and the American health care act, offer coverage to young Americans under their parent’s insurance till the age of 26
  • The affordable care act and the AHCA still prohibit the insurance plans from setting a lifetime limit and also offer tax credits to the citizens who buy insurance coverage

 

While a few aspects have been retained, there are few amendments made by the Republican party in their quest to repeal Obamacare through the GOP health care bill, replacing it with president Trump’s proposed health care reforms. The differences between the two are as follows,

  • AHCA eliminates the individual and employer mandate and the resulting penalties by making health insurance coverage optional for both the parties
  • Under the GOP alternative, Medicaid expansion is brought to a halt and restricts federal funding to facilities that offer abortions and planned parenthood
  • The proposed bill intends to repeal the taxes on health care and related services such as the over-the-counter medications, prescription drugs, health insurance and the medical device manufacturing industry, which was used by the affordable care act to pay for their plans

AHCA and Its Impact on Medical Device Manufacturers

Under the AHCA, the medical device manufacturers are set to witness sustainable growth that was capped by the excise tax of up to 2.3 per cent on the annual sales to help fund Obamacare. Under the affordable care act, this tax amount would be used to extend coverage to millions of American citizens without a health insurance coverage. The medical device manufacturing industry in the US develops, produces, and sells medical devices and surgical equipment such as high tech devices such as pacemakers and hearing aids across the globe. However, with the introduction of the affordable care act, the medical device manufacturing industry saw a significant loss of American jobs within a span of two years and scaled back their investment in research and development, and other related capital spends.

The drug, biotech, and medical device makers are set to benefit under the new reformed health care bill proposed by President Trump’s administration as it eliminates taxes worth billions of dollars on the industry. The medical device manufacturers have deemed the health care bill by the Republican party as a positive step towards eliminating medical device tax completely.

Want to know more about what’s trending in the medical devices industry?

Market segmentation

Medical Reimbursement, Health Economics, and Market Access Mapping for Wound Care Dressings

Limitations of the Fee-for-Service (FFS) medical reimbursement model and arrival of Value-based Purchasing (VBP) pose a significant challenge for medical device manufacturers and service providers looking to enter the medical reimbursement market space.

 

Despite being an integral part of every nation’s well-being, rising costs are putting a strain on the healthcare system and threaten to restrict doctors from providing their patients with the best care possible. With high levels of national debt and rising geriatric population, governments from across the globe are well aware of the steps that have to be taken to reduce the rising cost of healthcare expenses while retaining and ameliorating the quality of patients’ care. Medical reimbursement is a big part of this picture and continues to alter the methods of care. Limitations of the FFS medical reimbursement model and the arrival of VBP medical reimbursement are some of the key challenges faced by professionals looking to enter the reimbursement market space. Furthermore, with the growing preference for Value-based Care among payers and providers, they will continue to navigate between new and old ways of providing high-quality patient care, while keeping an eye on cost.

Over the years, reimbursement for medical device segment has utilized a variety of payment mechanisms withcapture varying degrees of effectiveness. However, whether these mechanisms are used individually or in combination, it is crucial that the resulting systems remunerate on the basis of complexity, quantity, and quality of care provided. Consequently, it becomes crucial for a medical device company to obtain coverage and attract risk-averse investors. Also, factors like whether a device is reimbursable or not and costs associated with reimbursement are key factors that determine a product’s demand and its commercial success.

At Infiniti, our “Healthcare Practice” team understands that reimbursement is an integral part of developing and marketing a medical device and is a key enabler for strategies adopted by companies looking to derive maximum returns from the success of their products in the market. Key components which our “healthcare analysts” cover include coverage, coding, and payment as those are considered pertinent for obtaining adequate reimbursement in today’s competitive healthcare market space.

The Business Challenge

To assess the dynamic medical reimbursement landscape and understand the costs associated with healthcare reimbursement, a world leading manufacturer of wound care and single-use surgical products engaged Infiniti for a study focused on understanding the wound care dressings reimbursement market in China and Japan.

The primary goal of this market opportunity assessment was to develop a comprehensive understanding of thecapture2 wound care dressing reimbursement market structure, price caps, regulatory compliances, the impact of the regulatory compliances on product prices, and medical reimbursement figures for wound care dressing products across the target countries. Additionally, this client also wanted to obtain critical insights into medical device funding and reimbursement pathways for wound care dressings product in China and Japan.

Infiniti’s healthcare practice team tracked recent developments and innovations in the market through secondary journals and reached out to relevant stakeholders, including industry experts, KOLs, product users, and procurement experts, to understand their views on the market. Our healthcare research team also spoke to stakeholders responsible for the sales and distribution of these products to understand how the market would grow in short and long term and also to validate the market size and opportunity model developed for this segment.

Why Infiniti Research is the preferred partner for more than 55 Fortune 500 Companies

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Solution Offered and Business Impact

By evaluating a wide array of published literature to develop an initial hypothesis, Infiniti’s healthcare intelligence team offered the client insights into the medical reimbursement market for their product, recent changes in reimbursement policies, and an analysis of regulations specific to the product’s reimbursement. The market opportunity assessment also helped the business understand the market structure, price caps, regulatory compliances, impact of the regulatory compliances on product prices, and reimbursement figures for its products across target regions.

In just nine weeks, our healthcare industry intelligence team helped the client understand reimbursement pathways for wound care dressings products and gain strategic insights for its wound care dressing products in China and Japan.

To assess the challenges specific to the medical reimbursement sector, Infiniti’s healthcare analysts have developed an extensive proprietary database consisting of information on more than two million industry experts, doctors, physicians, key opinion leaders, medical technicians, payers, end-users, and patients.

What do the clients appreciate about our approach?

In a relatively short period of time, just nine weeks, the client saw clear benefits from our relationship. The benefit was not only in terms of revenue impact or analytics turnaround time but also in terms of the experience we were staging for them by exposing them to a new way of problem-solving.

Here are some of the key points appreciated by our clients:

 

  • Dedicated Market Intelligence Portal. A centralized platform for the collection, storing, processing, reporting, and dissemination of information with the specific purpose of assisting the decision-making process and developing actionable insights. This portal includes comprehensive information on quantitative and qualitative aspects on target markets, competitors and end-users.
  • Collaborative learning. We leveraged experience of our healthcare team and our technical capabilities to enable report-sharing and other collaborative features appreciated by client teams.
  • Database Access. Access to a patient database containing information about 60+ medical diseases and conditions, such as patient undergoing treatment, untreated patients, and patients with chronic conditions.
  • Interactive Dashboard. Using our Portal based solution for healthcare professionals, we took a design-first approach to problem solving and helped break through previously held assertions.
  • Value for Money. Infiniti’s dedicated client management team customizes reports to suit business requirements and offers the best insights for every dollar spent.

 

A must-read case study for strategy experts and decision makers looking for effective market opportunity assessment for the healthcare reimbursement landscape.

 

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