On June 28, 2012, the Supreme Court of the United States (SCOTUS) upheld 5 to 4, the constitu-
tionality of the Affordable Care Act (ACA) and/or several of its provisions. The highly anticipated
decision stunned industry leaders and commentators by supporting SCOTUS’s decision through
the federal taxing authority.
The signicance of this decision will reach every area of healthcare as
the changes mandated under the ACA go into effect as planned. The provisions of the ACA, and the
Congressional power codied through the SCOTUS opinion may make the move toward national
risk pools all the more inevitable to accommodate future demands. Given the background of the
delivery of healthcare services in other societies, some type of national health insurance may likely
be the ultimate conclusion to many of the current issues within the U.S. healthcare industry. In that
vein, Affordable Care Organization (ACOs) may well be a necessary step on the path to a National
Single Payor Insurance model.
The future drivers of healthcare delivery are the same as those occurring today: exponential
growth of Medicare enrollees, increasing complexity and associated costs of technology; the per-
sonalization of medicine, and the scal burnout due to slow economic growth, high unemployment,
and record federal decit and debt. The rst baby boomers enrolled in Medicare in 2010. As the rest
of the cohort follows, the impact on the Medicare program will be signicant, with an estimated
92.8 million people enrolled in Medicare by 2050.
The increased demand for healthcare services
caused by this demographic time bomb will likely strain not only budgets, but the already limited
physician supply. Today, Medicare spending accounts for 15% of the federal budget and is expected
to grow at an average annual rate per capita of 3.5% between 2010 and 2019.
This situation is
further complicated as initiatives to limit healthcare spending need to be accomplished within sig-
nicant political pressure not to damage the present level of patient care or place undue nancial
burdens on the elderly.
On its current trajectory, the Medicare program may well become unsus-
tainable, making the Medicare policy debate a main driver of healthcare reform.
Despite current legislative efforts to manage and control the rising cost of healthcare, contin-
ued technological advancements will likely force costs upwards. Correlations between the cost of
medical services and the quality improvements resulting from technology advancements may fur-
ther exacerbate health disparities based on income and class, which runs contrary to the current
aims of healthcare reform. In addition to cost, technology also will drive the approach and pos-
sibilities available during the provision of care and services as the personalization of medicine
(e.g., genomics) continues to develop.
Knowledge concerning the future drivers of healthcare should affect future strategies and orga-
nizational design. Several of the many initiatives set into motion under the healthcare reform legis-
lation will no doubt push forward the ideals set forth within the healthcare reform’s triple aim
(i.e., access, quality, and cost). As the healthcare industry moves forward, policy makers and health-
care administrators should keep in mind that simply lowering the cost of healthcare does not nec-
essarily increase access, nor do increases in quality necessarily require parallel increases in cost.
How the healthcare industry will address future challenges is still uncertain; however, the
question as to whether ACOs are a logical step toward Alain Enthoven’s (American economist and
professor at Stanford Graduate School of Business) concept of managed competition is a dynamic
and volatile topic, involving the economic concerns of almost every stakeholder, each with con-
stituencies, advocacy groups, and lobbyists. Each of these stakeholders currently operates under a
pretense of commercial competitive markets at a time when a majority of those markets are domi-
nated by a single payor, and the consolidation of hospitals and physician providers continues at a