Industry leaders discussed the challenges and future of health care in the North Houston area during a North Houston Association luncheon on Tuesday. Panelists included State Rep. Tom Oliverson, R-Cypress, Brian Dean, executive vice president and chief financial officer of Memorial Hermann Health System, and Nelson Udstuen, vice president and regional director for CBRE Healthcare Services Group. The panel discussion was moderated by Jason Culpepper, Houston Metro publisher for Community Impact Newspaper. Dean said the health care industry is continuing to become an integral sector of the Greater Houston area’s economy, with the Texas Medical Center in Houston and the rise of health care facilities in The Woodlands—which is quickly becoming known as the ‘Medical Center of the North.’ “There’s not many cities in the country where you have the ability to stay local and receive the best health care you can get,” Dean said. “When you have a world-class center like the Texas Medical Center—or an extension thereof—everything you need is here, and I think that’s a great position to be in.”

Identifying challenges

As the health care industry continues to grow in the North Houston area, industry officials said there are still challenges that need to be addressed. According to Dean, one of the biggest challenges the health care industry is facing is the increasing Medicare population, because it is placing the financial burden more heavily on working families. “There are 10,000 people per day in the U.S. turning 65 and becoming eligible for Medicare,” Dean said. “In 2000, there were four working people in the U.S. for every one Medicare beneficiary; in 2016, that number is down to 2.8 workers per one Medicare beneficiary. So that’s a very fast-growing segment of the industry, and in Houston we’re experiencing a similar growth.” In addition to the growing Medicare population, Texas has the largest uninsured population in the U.S., which Dean said is perpetuating the increasing costs to working families. “In 2002, a working family of four in the U.S. that gained their health insurance from their employer had out-of-pocket expenses of about $9,200,” Dean said. “In 2015, that number is somewhere around $26,000. By 2030, that number is going to be over $50,000 in out-of-pocket expenses for a family of four.” Meanwhile, Oliverson said all the changes made to the Affordable Care Act over the past decade has also caused instability in the health insurance market. Oliverson said the health insurance market, as well as the lack of transparency across the industry, both need to be addressed in the next legislative session. “One thing we know about health care costs in this country is that they keep going up and up and up. And we’ve been talking for the last 30 years about doing something about that, and we haven’t done it yet,” Oliverson said. "Even the Affordable Care Act really did nothing to bend the cost curve down or really even level it off, so we’ve got to come up with some solutions.” Oliverson said one solution would be expanding health savings accounts, which he feels would empower patients to become consumers. Additionally, Oliverson said there needs to be transparency across the board when it comes to medical pricing. “Health care has gotten much more technologically advanced, and our costs have accelerated at unsustainable rates,” Dean said. “We’re the only industry that hasn’t gone through a significant transformation of disruption, and I think that time is now.”

Future outlook

As the baby boomers continue to age, so do the millennials, which Udstuen said means changing the way people receive health care. “None of the younger generation has a primary care physician,” Udstuen said “They go to an urgent care or they stop in a Walgreens or a CVS [Pharmacy] instead. It’s all about convenience.” With regard to convenience, Oliverson said technology has also become a game-changer for the health care industry. “One of the things we’ve been working on for the last 10 years—that’s really caught on over the last five years in Texas—has been telemedicine and telehealth and the idea that you can expand health care’s reach beyond the physical and into the virtual,” Oliverson said. Memorial Hermann has also recently entered the world of virtual medicine with the hope of catering to younger patients, Dean said. “Traditionally, health care has been a destination, and I think we have a very large brick-and-mortar footprint in the Houston and Woodlands areas,” Dean said. “At Memorial Hermann, we started a process about six months ago of doing virtual visits… because we wanted to bring something to the market that’s a differentiator that actually provides access to health care in other ways.”