Medical Influences In Purchasing Decisions

The change to value based purchasing has bought many challenges to the healthcare industry. With the change to value-based purchasing for payments, it has changed how healthcare organization receive payment and delivery care. The advantage of have value based purchasing is that it improves the quality of care while reducing cost in an effort of aligning patient’s with the right provider and treatment plan (Minemyer, Jun 29, 2016). However, there are many disadvantages, such as it increases the patient volume as counteracting the reduction of procedure volume (Brown, B. & Crapo, 2016). Also it makes providers more responsible for care that is beyond the expected treatment of care needed (Minemyer, Jun 29, 2016). With quality measures tied

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.

On the same level from a patient’s perspective, providers are even challenged with increased costs. Even though insurance is becoming more affordable the money, unfortunately has to be recovered utilizing other

HMOs are not the only answers to cost control. Most physicians practicing in the United States consider their profession to be very much a form of art (Kleinke). The definition of art infers that within its sphere there are many variations and preferences. After all, one should not ask Picasso to carve like Michelangelo. Physicians too differ in their methods of treating patients. However when needless tests and procedures are done the treatment will cost more. This is waste. Many suggest that cutting waste will lead to a cut in quality. This is not necessarily true. Consider the following: an otherwise healthy forty-year-old male

In healthcare system the highest quality medical care means” the greatest benefit to patients at the lowest possible cost” (Burke & Ryan, 2014, p. 3). “The Agency for Healthcare Research and Quality (AHRQ) defines quality health care as doing the right thing for the right patient, at the right time, in the right way to achieve the best possible results” (NCQA, p. 3) According to American college of physicians, the single most reason for the health care cost is higher healthcare spending. There are several factors involved in the high health care cost such as inappropriate use of technologies, lack of patient centered care, overuse of the reimbursement, excessive price for health care facilities, increased organizational cost, and health accountability are some of the reasons for increased health care cost. In order to decrease the cost, the available health resources be used judiciously and equitably. Understanding these factors and identifying the potential factors of health care costs assists in providing quality and effective services and thus improves the health outcomes (ACP, 2009).

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.

Anyone who has purchased prescription medications has probably wondered why they cost so much, and rightfully so. Medication prices in the United States have been on a steady increase for decades, however, prices have been drastically increasing as of recent. Pharmaceutical companies have tried to justify these price increases due to the demand, the high cost of research, and the high costs of development and approval. Notwithstanding, the extent to which the prices have increased is not justifiable. Americans should be against these high medication prices and take action because pharmaceutical companies are taking advantage of our healthcare system in order to capitalize from the sick. In order shed some light on this issue, the magnitude, scope, and consequences of these prices must be examined.

Between 2001 and 2011, the average patient’s out-of-pocket (OOP) cost for brand-name prescriptions rose by more than 80% (Tungol, et al., 2012, p. 691). The increasing OOP costs have contributed to a decrease

The first effort that will help with cost containment is monitoring the decisions of physicians. It is thought to be that physicians “determine who comes into our facilities, how long they stay, and what gets done to care for them along the way” (Rich Daly, 2013) If physicians really do determine all of that stated, then the efforts for cost containment need them to be the leaders. The article “Putting Physicians in the Lead for Cost Containment” also states that there are many factors that physicians can go through with such as improving daily care while keeping costs low, change procedures to “yield savings”, and it also states that they should be on top of things to notice progress. All of those factors stated in the article can contribute to cost containment in a way that also improves the quality of care. The ideas given will help patients by giving them a higher quality of care and it will also help physicians by giving them a

The real problem as pertains to the reimbursement of managed care organizations is that these managed care has had an effect on slowing the rates of growth concerning the costs of hospitals and specialist physicians. For both the hospitals and practitioners, the sources of revenue have been shifted with over 20 percent of the charges being paid from the pocket, others coming from third parties who demand for complex accounting of the charges, lack a pre-authorization process and they can review in a retrospective manner and deny the reimbursement (Furrow et al., 2013). The

This fundamental transformation of the healthcare industry is led by the Affordable Care Act (ACA). One of the impacts of this legislation was significantly reducing the rate of uninsured – from over 16% at the end of 2013 to under 11% at the start of 2015 (Source: Kaiser Family Foundation) – which has expanded procedure volume, creating a corresponding revenue tailwind for medical devices and Medtronic. To address the increasing costs and inefficiencies, the ACA shifts risk and accountability from payers to providers and other healthcare stakeholders. However, additional policies have also been shifting the way the healthcare industry thinks about reimbursement and cost.

This statistic brings focus to a trend that is seen over and over again throughout the country. Medical practices are seeking ways to upgrade and outsource in order to reduce expenses, enable them to bring in more revenue, and remain independent in what have become some tough times in the healthcare industry.

As it relates to the textbook, this describes some of the scope of the hospitals; which refers to the range of activities which the firm performs internally, the breadth of its product and service offerings, the extent of its geographic market and its mix of businesses. But unlike with the electric company, no regulator caps hospital profits. To the extent that author Steven Brill found any consistency among hospital charge-master practices, this is one of them: hospitals routinely seem to charge 2V2 times what expensive implantable devices cost them, which produces that 150% profit margin.

Furthermore, the rising demand by health care consumers to receive technological services spurred the need for medical facilities to band together to provide the widest array of services and the lowest possible cost. Over time, these groups of medical facilities became known as integrated delivery systems (IDSs) and there are various forms of IDSs today (Kongstvedt, 2012). Of note, one key feature that is consistent between all IDSs is provider involvement. Moreover, a key component to establishing IDS is the integration process (Shi & Singh, 2013). “Horizontal integration” focuses on expansion of the same or similar services while “vertical integration” focuses on acquiring new and different services (Shi & Singh, 2013, p. 233). An example of horizontal integration may be the opening of a satellite clinic across town, while vertical integration would purchase a new facility for dialysis services not previously provided by the