By Steven G. Ullmann, PhD
So let us look into the crystal ball. Let’s see what the crystal ball divulges concerning health care in 2026. What will provision of health care look like? What of access and affordability? What of AI and medical/technological advances? Let’s see what the crystal ball divulges.
Affordability? Really? Has health care in the United States ever been affordable? Personal health care costs are the greatest reason for bankruptcy in the United States. This includes people who have health insurance. Why?
Insurance policies, whether employer based or purchased through the Federal Exchange, have been structured increasingly with higher and higher deductibles and movements from dollar copays to percentage coinsurance rates once deductibles have been met. The underlying concept is a good one, with higher deductibles and a coinsurance methodology that relates out-of-pocket expenses to the cost of service or diagnostic procedure, the concept is to provide an incentive to be conscious of whether a medical service is truly necessary and for the patient consumer to shop around.
The reality is that for those with modest income and given the fact of continued limited transparency of price and quality information, the ability to make appropriate decisions is limited. The result? Putting off important diagnostics, delaying seeking of care until issues become more significant, or surprising out-of-pocket costs. The realization is that these high deductible, coinsurance plans which are related to lower health insurance premiums have been established as inducements to enroll in such plans.
It wasn’t too long ago when our uninsured rate was approaching 50 million people in the U.S. Today it sits at approximately half of that number. But this is also partially a result of the enhanced subsidies available to purchase health insurance policies through the Federal Exchange that were provided during and after the COVID pandemic, subsidies which at the time of this writing may end.
One further policy affecting the number of uninsured in the country is an aspect of the so-called “Big Beautiful Bill” which eliminates of the federal funding of Medicaid expansion.
Forty states have expanded their Medicaid programs with 90 percent of the cost of expansion covered by the federal government as a result of one of the elements of the PPACA. That subsidy will now have to be absorbed by the states and, if states are unable to fully fund or if they limit funding, we can anticipate individuals will fall off the Medicaid rolls. Given that Florida was one of the ten states that did not expand Medicaid, the impact of this latter policy change will not be as great. But changes in eligibility requirements will impact Medicaid enrollment. The bottom line is that the numbers of uninsured will increase. Those with insurance but with high deductibles and coinsurance will have limitations in financial access and will not be able to pay their bills. Bad debt incurred by hospitals and physicians can be anticipated to increase. Financial bottom lines for health care systems and private clinicians will be impacted negatively.
Another hit to the finances of hospital systems, physicians and other clinicians is the impending insolvency of Medicare. According to the Trustees of the Medicare system, Medicare becomes insolvent in the year 2034. That is two years earlier than what was anticipated a year ago.
Medicare cuts are forthcoming but cutting Medicare benefits to recipients over the age of 65 is the “third rail” as far as Congressional members are concerned if they wish to be reelected.
So what is left? Increases in Medicare taxes (also unpopular) or cutbacks to providers. We have seen significant cutbacks in reimbursements to date that impact providers. For example, for physician providers, for any given medical procedure, a physician’s reimbursement will not have increased to keep up with inflation nor has it stayed constant. In reality, over the last fifteen years reimbursement to physicians for any given procedure has actually dropped by over fifteen percent and reimbursements per procedure continues to drop every year. Further, private insurance tends to follow federal trends. Given the highly competitive nature of the health sector, it is not surprising that the life of hospital and health care system administrators and clinical providers has proven to be very stressful and frustrating and burnout is so high.
And what about Artificial Intelligence and technology? The question has been asked, “Will AI replace clinicians?” The response is “AI will replace clinicians who do not adopt AI.” Artificial Intelligence has taken on a large role in the backroom of health care business operations. In the clinical realm, AI indeed has taken on a much larger role, this is no doubt. However, AI must be used carefully. The old saying of “garbage in… garbage out” is an aspect of AI that one must be aware of. There are implicit biases in the use of AI. Artificial Intelligence in clinical diagnoses is a bit like case law. If an inappropriate judgement occurs in one case, it will lead to inappropriate judgements in future cases. Given that historically racial and ethnic minorities and women have not been a significant part of research studies or historical diagnostic data, medical decisions drawn on data based on Artificial Intelligence may well lead to biased or incorrect results. Take for instance, dermatological assessment. AI is relatively successful when diagnosing skin cancer on light skinned individuals but fails in catching serious skin cancers for people of darker skin. In studies looking at AI assisted radiological diagnostics, whereas Artificial Intelligence is perceived as potentially replacing radiologists, currently it is found that there is significant variation in assessments and accuracy across physicians within the radiological specialty as well as across different AI platforms.
These examples reflect the fact that there are still significant unknowns regarding the efficacy of AI and the ability to rely on AI in the clinical arena. One additional interesting development worth mentioning is the globalization of surgery. In an FDA approved clinical trial, a physician in Orlando, Florida performed a cancer removal surgery through robotic telesurgery on a patient 7,000 miles away in Angola. There have been several other cross country robotic telesurgery procedures accomplished around the world in the last year. With the growing potential globalization of surgery, on the one hand, surgeries can be performed in areas in need, but also it means that there may be global price and quality competitiveness in surgical procedures going forward. It will be interesting to see.
So let me put the crystal ball away for a while. Let us see how accurate it has been as we enter our new year of health care.
Dr. Steven Ullmann is Director of the Center for Health Management and Policy; Director, Health Executive MBA Program and MD/MBA Program; Professor in the Miami Herbert Business School Health Management and Policy Department, and Special Assistant to the Provost. He can be reached at (305) 284-9920 or sullmann@miami.edu.
