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Managed care: competitive strategies for academic medical centers.

For academic medical centers to get from where they are to where they need to be, their traditional clinical services paradigm must change in a frame-breaking, re-engineered, revolutionary way. The change must be real, as the market place will recognize impostors, and it must be led by a strongly committed executive leadership team. This professional paper will show that once accomplished, academic medical centers will most likely acquire the "competitive advantage" needed to win their rightful position in the future health care marketplace.

Academic Medical Centers↗

Customer service: the key to remaining competitive in managed care.

The health care industry is undergoing a rapid transformation to meet the ever-increasing needs and demands of its patient population. Employers and managed care organizations are demanding better service and higher quality care, while providers are trying to tackle reimbursement cutbacks, streamlining of services, and serving a diverse population. Providers have begun to realize that to overcome these obstacles and meet the needs of their health plans and consumers, they must focus on the demands of their customers. Health care organizations have found they can meet the demands of both the consumer and the managed care industry through initiating and maintaining a customer service program. This essay explains the importance of customer service and its link to success in the managed care environment.

Consumer Behavior↗

The health system: what should our priorities be?

ISSUE ADDRESSED: The way the health system is organised is a critically important social determinant of health. Australia's current health system funding arrangements contain serious barriers to effective health promotion and chronic disease management. The consequences are most evident among disadvantaged people. Major health system reform is needed in Australia to rectify this problem. METHODS: This paper describes current mechanisms for funding health care in Australia and examines a recent reform experiment, the Co-ordinated Care Trials. It discusses why the trials were unsuccessful and identifies key criteria for future success. Three existing proposals for health system reform are assessed against these criteria - managed competition, a Commonwealth takeover of health and medical saving accounts. RESULTS: Successful reform of Australia's health system will need to ensure that more flexible services are delivered, changes are made on a large scale to affect demand and strong incentives to use cost-effective services are put in place. Of the models considered, managed competition best meets these criteria and is most likely to reduce health disparities and improve health promotion and disease prevention. A Commonwealth takeover of health funding is a less ambitious alternative but because of this, it is also likely to have less impact. It is doubtful whether medical savings accounts meet any of the criteria for success and they would also require a fundamental change in the values that underpin the Austrlian health system. CONCLUSION: Recent reforms of Australia's health system have been too small and have had little impact. Although radical reform of the health system is politically unpalatable and extremely rare, it may be the only way Australia will be able to meet the health challenges of the 21st Century.

Australia↗

Rationing health care: what it is, what it is not, and why we cannot avoid it.

The word "rationing" has come to play a central role in the national health policy debate. Alas, it is also one of the most misunderstood of words. Its injection into the debate has generated far more heat than light. This chapter reviews the definition of "rationing" preferred by the profession that takes as its task the study of how individuals and society respond to and deal with scarcity, namely, the economics profession. It will be shown that economists usually consider all limits on the distribution of a scarce good or services to be "rationing," whether that limit takes the form of a price barrier or some method of non-price allocation--for example, queues or allocation by lottery. To make a distinction between allocation through freely competitive markets and other forms of resource allocation, economists distinguish between "price rationing" and "non-price rationing." This is a meaningful distinction. Adoption of the economist's definition of "rationing" would greatly clarify the national health policy debate. Next, the discussion turns to the controversial proposition, commonly made by most economists and a handful of their allies in the medical profession, that an economically efficient health care system will inevitably engage in the pervasive withholding of services that may be sought by patients and their physicians, and that it will do so to enhance the quality and efficiency of the health care system overall. If managed competition lives up to its current billing, it will entail rationing of precisely that sort. Unfortunately, the individualist tradition of the United States, as it expresses itself in the tort system, may seriously hinder managed competition from achieving its stated goal. Finally, this chapter offers some conjectures on the approach to rationing likely to be taken by the United States health care system in the twenty-first century. It is argued that, far from having been inconclusive, the most recent congressional debate on health care reform actually gave official sanction to a three-tiered health system, with fairly severe rationing in the bottom tier and virtually none in the top tier. While such tiering has always been present in the U.S. health care system, the phenomenon has hitherto been treated as a blemish to be removed by government--now it will probably remain a permanent fixture.

Delivery of Health Care↗

Living with capitation. Experts look at challenges of setting a prepaid rate.

A major goal of managed competition--changing incentives to encourage better delivery--will rely heavily on capitated payment, experts agree. But can capitation be applied correctly under managed competition? Achieving savings without suffocating healthy competition will be a challenge, say observers.

Capitation Fee↗

Aggressive regulator or passive price-taker: what role should HIPCs (health insurance purchasing cooperatives) play?

Despite extensive variations on the theme, managed competition continues to be the favored model of federal and state governments in crafting health reform. A critical element in managed competition is the establishment of health insurance purchasing cooperatives (HIPCs), which band together the collective buying power of individuals or employers to give them market "clout". Policymakers must decide whether they want a HIPC to be an aggressive regulator--using its power to force changes among health plans--or a passive price-taker that contracts with plans meeting key criteria.

Competitive Medical Plans↗

[The US Health Care and the reform].

Securing access to medical services, controlling costs and improving quality are goals of health care system. Although they are all the same all over the country, each country has its own culture, health care system and health care problems. In the United States, employer-based and individual purchases of private health insurance coverage play a major role, although governmental programs such as Medicaid and Medicare exist for the poor and the elderly. Private health insurance had traditionally secured patients' freedom of choice of health care providers and physicians' professional freedom and had paid providers on a fee-for-service basis. Now, the U.S. has 40 million uninsured persons who do not have access to medical services, although it spends as much as its 14% of GNP on health care. In the early 1990s, this became a major political problem. President Clinton proposed the 'Health Security Act' which would enable any American to have access to comprehensive health care with managed competition to activate the health care market, but it was not enacted. Nevertheless, it is clear that managed care and managed competition will dominate and that traditional fee-for-service plan will be eroded in the health care market. Japan has a universal health care system. We do not have any uninsured or high medical costs. However, it is difficult to improve the quality of health care services within the present system. Japan can learn the system about disclosure of health care information from the managed care in the U.S.

Adolescent↗

Paying for efficiency: what price the quality of hospital care?

Economic recession prompts governments and health service ministers to seek increased efficiency in the production of hospital services in order to reconcile increasing demands with scarce resources. As one approach to the problem, the National Health Strategy is recommending pilot schemes, similar to those which have been introduced in both the United Kingdom and the Netherlands, which involve the separation of purchaser from the provider of hospital services. It is argued that such separation, with the introduction of competition between providers of hospital services for contracts placed by publicly funded Area Health Boards, will increase efficiency and accountability in the use of resources. However, this argument ignores the hospital management's ability to keep costs down by altering the quality of hospital care in ways which are difficult to monitor by purchasing agencies. The article considers the effects the introduction of managed competition is likely to have on the quality of hospital services. The outcome is uncertain and competition may improve some dimensions of quality while jeopardizing others. If managed competition is tried in Australia, the opportunity should also be taken to examine its impact on the quality and outcomes of hospital care.

Australia↗

Multiple choice health insurance: the lessons and challenge to employers.

This paper offers a second opinion on the issues discussed by Stanley B. Jones in his paper, "Multiple Choice Health Insurance: The Lessons and Challenge to Private Insurers" in the Summer 1990 issue of Inquiry. Multiple choice of health plans is not containing costs of health care or insurance premiums because employers have not yet tried price competition with cost-conscious consumer choice. HMOs in multiple choice arrangements have not saved employers money because of the way employers manage competition. Effective management of competition must be an active process employing an array of tools to create incentives that reward production of high quality economical care.

Community Participation↗

Competitive health plans and alternative payment arrangements for physicians in the United States: public sector examples.

The Medicaid program in the United States is moving to a competitive managed care system whereby patients no longer have freedom of choice of physicians and physicians are given incentives to provide care cost effectively. The wide variety of competitive managed care programs represents attempts to introduce rationality into the relationship between consumers and providers in a community. Early evidence, based largely on preliminary data analysis indicates that competing plans which place physicians at some financial risk and also employ administrative mechanisms, are more likely to show cost savings than health plans that do not employ these methods.

Cost Control↗

20 strategies for marketing your managed care plan.

In today's fiercely competitive managed care marketplace, healthcare executives must find a way to set their plans apart from the competition and build a sufficient customer base. At the same time, they must confront a growing anti-managed care backlash among a wary and confused public. Healthcare executive magazine talked with managed care experts to gather their views on key strategies to help executives meet both of these challenges. Here's what they suggest.

Advertising↗

Health care reform: separate and unequal?

The author discusses the current and evolving forces which are operating to prevent the establishment of a universal, comprehensive, equitable, cost-effective health care system for all Americans. It is the contention of the author that managed competition, the most popular of the plans being discussed by the Clinton administration, will perpetuate the separate and unequal health care system which currently exists. The author supports this conclusion through a detailed critique of the proposed managed competition system.

Ethics, Medical↗