Competition in Healthcare Hca421 Essay examples

The next factor to consider is competitive position and healthcare firms can substantially ensure higher quality of care when pricing there products and services at an increased level. Aside from pricing, cost is another major aspect since it can drastically affect a company’s competitive position. A hard investment would involve a MRI device that insurance companies or healthcare organizations could reimburse the office at a higher rate for providing the patients of improved cost-efficient results. As a result, such benefits accrue primarily from savings in drug expenditures, improved utilization of radiology tests, better capture of charges, and decreased billing errors, (Wang et al., 2003). Physician providers are always in competition with the latest and greatest technology, EMR system, and most effective medication for patients.

Throughout the history of the United States, the economics of the health care system has experienced many changes. There are many factors to consider that has been the drive behind many of the changes within the health care system. Medical and surgical technologies are some factors that relate to the changes in health care. Besides these factors, allocating sources to fund health care services has always been the most critical factor. One might consider the economic term supply and demand when looking at the history of health care economics and the primary funding source. Health care funding

Cost has different perspectives depending on whom we are speaking about. Consumers refer to cost in reference to the price of healthcare, bills to insurance or payments to doctors directly. Nationally we refer to healthcare spending as a reflection of all healthcare spending that occurs in the nation and is normally measured in a percentage of the Gross domestic product or GDP. Provider costs are seen as the cost to pay staff, buying medical equipment and capital costs for buildings and the maintenance of the buildings infrastructure (Shi & Singh, 2005).

One of the goals of the Affordable Care Act (ACA) was to reduce healthcare spending in the US (DeMichele, 2015). However, the passage of the ACA has spurred activity that is counter to this goal of decreased spending in the form of increased hospital consolidation which many studies show has led to higher prices. While, there are many other effects of hospital consolidation such as the impact on quality of care or innovation, these topics are beyond the scope of this paper.

One area that has contributed to the rise of healthcare costs are the varieties of healthcare services offered to the patient. Competition between providers has caused physicians and hospitals to offer the most current healthcare technologies and modern, eye-catching settings in order to attract and retain clients (Shi & Singh, 2015). Reimbursements for costly procedures and hospital services have been compensated at a higher rate which has also supported the expansion of hospital and specialty procedure settings (Schroeder & Frist, 2013). Renovations of the physical settings and the acquisition of expensive technologies have elevated healthcare services prices to encompass the additional costs of providing high technical services and attracting clients and cause the over-utilization of expensive treatments.

Competition between providers has caused physicians and hospitals to offer the most current healthcare technologies and modern, eye-catching settings has contributed to increasing healthcare costs, as well as providing unwarranted highly technical services (Shi & Singh, 2015). Renovations of the physical settings and the acquisition of expensive technologies elevated healthcare services prices to cover the additional costs of providing high technical services and attracting clients.

With the continued transformation of the healthcare system, an increased emphasis on consumerism and quality-based reimbursement will be observed. This could lead to challenges for all managed care stakeholders. One example of an industry change that might occur is that patients’ out-of-pocket costs could increase. The cost of healthcare continues to rise faster than inflation, generating increased incentives for insurance companies to offer plans with high deductibles and small networks. In the article “The Top Changes MCOs Should Expect in 2016” Joel Brill (2015) states that:

There are so many different health care providers and types of health care services that we as consumers can receive. All those different services or facilities are going to have competitive prices for our medical care. I think a patient as a consumers are going to benefit from this. Not only do medical facilities have competitive prices but also insurance

Hospitals are viewed unfavorably by most patients for the elevated (and often surprise) costs, care quality, and their lack of follow up to the provided care. “Who could feel sympathy for a billion-dollar corporation?” (Gunderman, 2013). Our payor-driven (as opposed to consumer-driven) health system has resulted in inflated costs, increased waste, and a race where executives continuously search for ways to increase their revenue share to stay relevant in market size, instead of improving patient care quality. Unfortunately, the increased level utilization linked payment system discourages investment in the most basic mantra: health quality.

Chapter one in our textbook briefly discusses health care data sets for benchmarking. One of the categories it mentions is patient satisfaction. Patient Satisfaction has always been a priority for healthcare facilities in providing quality care to patients. However, it now plays an integral role in the financial aspect of healthcare. According to our textbook, “CMS partnered with the Agency for Healthcare Research and Quality (AHRQ) to develop the Hospital Consumer Assessment of Healthcare Providers and Systems (HCAHPS), ‘the first national, standardized, publicly reported survey of patient’s perspectives of hospital care’ (CMS, 2012). Since 2005, the government has created several financial incentives for hospitals to participate in HCAHPS

price, quality, convenience, and superior products or services); however, competition can also be based on new technology and innovation. A key role of competition in health care is the potential to provide a mechanism for reducing health care costs. Competition generally eliminates inefficiencies that would otherwise yield high production costs, which are ultimately transferred to patients via high health service and delivery costs. With so much competition going on in the healthcare field and around the healthcare organization of my choosing, reducing cost for the patients will keep my organization in the competition for more patients to come

Another group often blocked is complementary or alternative health care practitioners. These restrictions and the insurance industry unwillingness to pay for these services, gives the physicians an almost monopolist control over health care. Providers must be able to enter the market for competition to work and there must be many providers vying for the patient. To get the most out of health insurance plans Consolidation of hospitals and multispecialty group practices increases the negotiating leverage of the group but in certain areas of the US a single large medical system has become the sole provider of major health service thereby restricting competition (Shi & Singh, 2008). This consolidation while giving the hospitals and group practice leverage when negotiating prices of supplies and services tends to increase the price of health care to the patient because there is no longer any competition (Shi & Singh, 2008). For these reason “competition will remain less effective in most health care markets, because the prerequisite for fully competitive markets are not fully met” (Federal Trade, 2004, p. 20).

There are many different forms of competition among health care organizations. Some of them are the prices of services, different co-pays someone will have to pay out of pocket, lower premiums, they have to be competitive in the quality of the service in which they perform daily. The health care competition is being advertised every day. The competitive nature of business cause them to reach out to the community. The health care industry has to fight for the approval of the community, the government, the insurance companies, the pharmaceutical companies and of course the stake holders as well as future investors.

Hospitals and health systems in the U.S. are experiencing a remarkable transformation in their business models directed from numerous influences that are projected to ultimately turn the industry around. Pressures include providers troubled with the quantity of services they are responsible for, to providers who concentrate on presenting high-cost services that give emphasis to sustaining healthy populations (Dunn & Becker, 2013).

Modern age is the age of competition. Competition factor has entered in every field of life. The healthcare industry is no exception to it. To keep pace with changing time, the hospital needs to welcome innovation and use modern technology. Hospitals have to struggle for their existence in today’s competitive world. Competition may be of two kinds, pricing and servicing competitions. Service competition is much more important than pricing competition. Management in health-care services: In comparison to developed nations, India, though one of the most