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Early Harbingers of the Reform Era

By Michael Sachs, Chairman/CEO, Sg2, July 15, 2010

We are scarcely 3 months into the reform era of health care, but already there are early signs of how the reform decade of the 2010s will play out. This will be a replay to a certain extent of the 1990s, for those that remember that era. Quick fact—the era of PPOs and negotiated discounts was set off by changes to the Medicaid program in 1983 that brought about competitive Medicaid provider contracts. We remember what ensued, from the dramatic decline in Medicaid payments to the growth of the managed care industry. The consolidation of providers, formation of physician networks and IPAs, development of disruptive delivery approaches, from ambulatory surgery centers to specialty hospitals, can all be traced to legislative changes. Will we look back at this decade and make the same comments about US health care? The answer is, unequivocally, yes! We can already see the signs of dramatic changes in rhetoric and actions of physicians, hospitals and government. And the regulations supporting the Patient Protection and Affordable Care Act have not yet begun to be adopted.