Affordable Care Act Attracting Entrepreneurs to Health Care Market

While there are many criticisms of the Affordable Care Act (ACA), one benefit is that it seems to be spawning a number of start-up companies designed to help companies and employees make sense of the new health insurance marketplace. Technologically savvy entrepreneurs are also looking at developing new systems to ensure that providers can manage the new value-based payment model required by the ACA.

 

Under the new law, eventually insurers will pay health care providers based on the quality and outcomes of care instead of the volume of care, which requires that insurance claims data be combined with electronic medical records. This need will increase as the number of accountable care organizations (health care providers that work collaboratively and accept collective accountability for the cost and quality of care delivered to a population of patients) continues to grow. Managing populations for health risks will be the future challenge.

 

The fact that providers are now able to receive compensation for working with patients via new video and smartphone technologies has also opened the door to entrepreneurs looking to create a niche for themselves.

 

Start-ups are also taking advantage of the confusion in the health care market as companies try to decide whether to continue to offer traditional group health insurance. If a company chooses to forego offering group health insurance, these start-ups may step in as benefits administrators for the employees. Other start-ups are working on creating incentives that companies and insurers can offer consumers as a way to improve their health and reduce the need for care.

 

On the consumer information side, online communities that focus on particular diseases and their care and treatment are increasing. While mainly designed to provide support for patients suffering from specific conditions, these sites may, in the future, be able to make their shared data available to researchers, physicians and insurance companies, resulting in more start-up opportunities.

 

As the health care market continues to evolve, so will the opportunities for start-up companies, and their investors, to create new products and services.