ACA Pay-For-Performance Model Highlights Need for Medical Innovation

The Affordable Care Act went into effect on January 1. The new law has changed the medical industry in many significant ways. One of the biggest changes is a new pay-for-performance model, which forces medical providers to adapt to more efficient models and improve patient outcomes. These changes force them to embrace medical innovation.

Background of Pay-for-Performance Model

Prior to the ACA, physicians were paid standard fees for Medicare patients. The new laws stipulate that Medicare payments will be higher to physicians that have better patient outcomes. This gives providers an incentive to offer high quality care upfront and minimize the need for patients to come back for further treatment (other than standard follow-ups).

Medical companies recognize that these changes are the beginning of a new movement to focus on improved patient outcomes. They have started changing their service models to place greater emphasis on improved outcomes.

The free market is also placing more pressure on healthcare providers. Health insurers are offering much narrower networks to their customers. They have left many healthcare providers that offer high fees out of the market altogether. In their quest to keep healthcare costs low, they are also expected to abandon providers that don’t adequately treat the patient properly the first time around.


ACA Drives Need for Medical Innovation

The Affordable Care Act is clearly making the healthcare industry far more competitive. Many providers are creating internal policies to emphasize the need for better outcomes. In order to achieve these goals, they will need to focus largely on medical innovation. Here are some of the ways that innovation will change the landscape of the healthcare industry:

  • Many medical errors are caused because medical professionals confuse patients or have incomplete medical histories. Providers will need to maintain highly accurate patient records to minimize these risks.
  • There will be higher demand for technology that focuses on identifying medical problems. Medical imaging software has significantly improved medical care, but still can be vastly improved. Medical software companies will continue to provide these solutions to meet the needs of medical providers.
  • New software will be used to improve communication between medical providers. This will significantly reduce the risk of misunderstandings that often lead to medical errors.

The Affordable Care Act has already significantly changed the medical industry in many ways. The demand for more innovative solutions will probably drive providers to demand more innovative solutions in the years to come.


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Priya is a technology blogger. She loves to blog about blogging, business, gadgets, social media, latest tech news and wordpress.


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