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Is Healthcare Regulatory Relief on the Way or a Continuing Provider Fantasy?

April 1, 2021
April 1, 2021

Let’s start with the common ground: Governmental agencies tasked with regulating healthcare providers, and the providers themselves, speak with one voice when it comes to patient care. They all want the best care and optimal outcomes for the taxpayers/patients they serve.

And now, to the differences. The federal government (and often its state and local counterparts) continue to produce myriad complex, interconnected, and often conflicting regulations around patient care, patient data security, and everything else healthcare-related. The American Hospital Association (AHA) put out a report, “Regulatory Overload: Assessing the Regulatory Burden of Health Systems, Hospitals and Post-acute Care Providers,” in late 2017 that highlighted the costs to healthcare entities of meeting mandated oversight:

  • Health systems, hospitals, and post-acute providers collectively spend nearly $39 billion a year on the administrative activities related to regulatory compliance.
  • The regulatory burden equates to an average cost of $1,200 per patient admitted, or $47,000 per hospital bed, per year. 
  • On an individual hospital basis, hospitals that are part of larger systems incurred a total of $5.1 million in costs per hospital, compared to $8 million for individual hospitals that were not part of a system.
  • Health systems, hospitals, and post-acute providers must comply with more than 600 discrete regulatory requirements with the greatest number found in the areas of Conditions of Participation, Privacy and Security Rules, and Quality Reporting. 
  • An average size hospital dedicates 59 employees to regulatory compliance. 
  • Fraud and abuse requirements are outdated and have not evolved to support new models of care.

In its research, the AHA explores the tension between providing high-quality care and the need for governmental oversight, and how those two goals often collide rather than work in tandem.

“Federal regulation is largely intended to ensure that health care patients receive safe, high-quality care. In recent years, however, clinical staff — doctors, nurses and caregivers — find themselves devoting more time to regulatory compliance, taking them away from patient care. Some of these rules do not improve care, and all of them raise costs,” the AHA stated in its summary of the report. “Patients also are affected through less time with their caregivers, unnecessary hurdles to receiving care and a growing regulatory morass that fuels higher health care costs.”

But what would change look like? For providers, the answer would seem to be fewer, and more streamlined, regulations. Regulatory agencies might be on board with that as well, but in an industry where rapid change has become the norm, and advances in technology, particularly around data collection, storage and security, that’s easier said than done

And for its part, the AHA (as well as the broader healthcare community which reported on its findings) does not have a clear answer. All anyone knows for sure is that regulation has become a costly, time-consuming, and increasingly harder to bear burden, but a way to reduce it while also ensuring quality patient care remains elusive.

Download the article on which this post is based.