Health Sector Transformation Requires a Primary Care Makeover, According to PwC's Health Research Institute

Forecasts of physician shortages are based on outdated care models; New delivery models and innovative technologies will close the gap

Nov 18, 2015, 07:00 ET from PwC US

NEW YORK, Nov. 18, 2015 /PRNewswire/ -- In the New Health Economy, primary care is likely to make a comeback -- with a newfangled twist, according to a new report from PwC's Health Research Institute (HRI). Technology, consumer-friendly new entrants and care teams that rely less on a single physician are leading the way to a reimagined primary care system, poised to deliver better value to today's demanding purchasers.

In the report, "Primary Care in the New Health Economy: Time for a Makeover," HRI calls into question forecasts of looming physician shortages – perhaps 90,000 by 2025 – noting that earlier predictions were based on outdated care delivery models. In the New Health Economy, with the emphasis on value and convenience, integrated care teams using virtual tools are poised to close the gap.

"With rising costs and increased demand, primary care practitioners need to rethink their business models to unlock value – and be rewarded for their contributions," said Simon Samaha, MD, a principal in PwC's US Health Industries practice. "We're going to see non-traditional players shake up the industry using new technologies and innovative approaches focused on convenience for patients and value for providers."

HRI identifies seven distinct consumer markets: frail elderly patients, consumers with complex chronic disease, consumers with chronic disease, patients with mental illness, healthy families, healthy adult enthusiasts and healthy adult skeptics. Understanding and serving these distinct markets will be the keys to success in a value-driven world.

HRI interviewed 25 executives from industry, trade associations and academia and surveyed 1,500 clinicians and 1,000 consumers on the future of primary care, other key findings:

  1. Purchasers are banking on primary care to save money – for example, the US government is pumping billions of dollars into primary care improvements. Employers are igniting change by adding lower cost, more convenient primary care benefit plan options such as telehealth services.
  2. Consumers are selecting primary care that fits their lifestyles. HRI found that 82% of consumers would be open to non-traditional ways of getting medical care.
  3. New entrants are disrupting the healthcare industry with innovative primary care models offering convenience and value to consumers and purchasers.
  4. Some primary care traditionalists are adapting to stay relevant. One-third of physicians are altering their business model to adapt to changes in the marketplace.

"Primary care needs to shift from its traditional role of 'gatekeeper' to an array of specialties and instead become a more engaged, central part of the system.  This change is being driven by the demands for greater value, consumer need for convenience, and changing health demographics," said Kelly Barnes, US health industries leader, PwC. 

New entrants are driving change in the primary care market

Five new models have emerged in today's primary care market: convenient care, house calls, at-your-service care, digital health, and nurse-led care. New entrants in the primary care market are accelerating the pace of innovation in these models, and traditional players are noticing. Sixty-nine percent of physicians surveyed by HRI believe that non-traditional care models have increased access to care. Almost half believe that they these types of models have had a positive effect on patient satisfaction. In response, about one-fifth of traditional primary care physicians said they have started providing new services, such as virtual visits.

"Challenging old business model assumptions and leveraging new technologies is going to be key to the transformation of primary care. As patients become more open to novel ways of receiving care, new entrants are taking advantage of this change while traditional practitioners alike must embrace it, or be left behind," said Vaughn Kauffman, PwC Health Industries' principal and leader of PwC's new entrants practice.

HRI's report also includes several case studies, examining how:

  • Massachusetts-based startup Iora Health is putting value back into primary care by focusing on building meaningful doctor-patient relationships.
  • The Hispanic community is rewriting the definition of primary care through a focus on cost, and an openness to mobile health and retail clinics.
  • CVS Health is becoming part of a community-based care model that increases the impact of traditional physicians.

For additional detail on the findings and an interactive tool for exploring where the seven distinct consumer types will go for primary care in the future, click here.

About PwC's Health Research Institute (HRI)

PwC's Health Research Institute (www.pwc.com/hri) provides new intelligence, perspectives, and analysis on trends affecting all health-related industries. The Health Research Institute helps executive decision makers navigate change through primary research and collaborative exchange. Its views are shaped by a network of professionals with executive and day-to-day experience in the health industry. HRI research is independent and not sponsored by businesses, government, or other institutions.

About PwC's Health Industries Group

PwC's Health Industries Group (www.pwc.com/us/healthindustries) is a leading advisor to public and private organizations across the health industries, including healthcare providers, pharmaceuticals, health and life sciences, payers, employers, academic institutions and non-health organizations with significant presence in the health market. Follow PwC Health Industries at @PwCHealth.

About PwC US

At PwC, our purpose is to build trust in society and solve important problems. We're a network of firms in 157 countries with more than 208,000 people who are committed to delivering quality in assurance, advisory and tax services. Find out more and tell us what matters to you by visiting us at www.pwc.com.

PwC refers to the PwC network and/or one or more of its member firms, each of which is a separate legal entity. Please see www.pwc.com/structure for further details.

© 2015 PwC. All rights reserved.

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