Health care systems and policy

Health Care Management

Obstacles to change in Health Care management.

There are a nearly infinite number of things that can go wrong for a health care manager, and out of the two major problems that can arise, staff relationship problems and stresses over financial constraints, the more trying of the two managing the financial interests of the facility within the constraints from senior staff and management. The health care facility is in place to provide the highest quality care for a patient who is in need. The goal of those in the health care industry is to help the person with the talent, skill, medications and procedures which will aid the persons healing and recovery. When the hospital commander or staff decide that the profit margin is not high enough, the pressure arise at the level of the staff management and staff to find a way to reduce costs, or to be more efficient, or even to reduce the number of patients. Figuring out how to balance the need for a trim budget with the doctors need to feel that they have freedom in their treatment options can pose difficulties.

The priorities from the other side of the equation which create the pressures include the fiscal reality of running a business. If the hospital staff do not run a profitable organization, or at least stay within the budgetary constraints given them, then the facility could, in a worst case scenario, close and leave the entire community without any health care options. The effects on the community from this consequence are worse than wrestling with a budget. While this doomsday scenario creates the desire for staff to apply the budgetary measures to their daily work, it does not reduce the ethical and personal obstacles which must be negotiated.

Raising the profit margin, balancing the books, and assuring that the hospital is a viable business first and foremost must be balanced against the value of the health car provided. The value of the provided service is evaluated against its effectiveness for the patient, which means that ultimately the monetary value for a service must be applied against the value of the individual. How does a health care professional determine that saving $5,000.00 on a procedure that has a low probability to success is a 'good' decision? This is the biggest problem faced by health care managers. Possible solutions may lie in a variety of fund-raising techniques, cutting waste, reducing unnecessary procedures on the under-insured, or trimming personnel expenses. At the same time, assuring quality so that the hospital can best attract patients with the willingness and ability to pay for high quality treatment balances the other end of the teeter totter.

This is the problem I would prefer to investigate further, since it seems to be the most pressing for most health care managers. This pressure lands on the shoulders of the health care administrator. (Shah, Reed, Francis, Ridley, and Schulman, 2003)

Health care premium rose 13.9% this year, according to a recently released survey of more than 2,800 companies by the Kaiser Family Foundation and the Health Research and Educational Trust. (Knight-Ridder, 2003) Beyond the major contributors to health care costs, a recent study by PricewaterhouseCoopers (PwC) found that at least seven separate components are fueling today's double-digit health care cost increases. By understanding these different categories of cost pressures, the staff of a medical facility can proactively take steps to manage costs while doing everything possible to stay away form the patient cost - benefit equation.

According to the Mercer/Foster Higgins 2002 national survey of employer-sponsored health plans, the average cost of healthcare benefits for active employees increased 7.3% in 1999, 8.1% in 2000 and 11.2% in 2001. In 2002, costs were expected to rise an additional 12.7% or more (Becker, 2002).

Data from the American Assoc of Health Plans.

From this chart, the health care manager can see that only a small sector of the cost increase factors can be influenced by the health care manager. The health care manager can positively affect the provider expenses, by making good decisions the medical facilities manager can steer his organization away from litigation, and the medical staff has a direct influence over waste / fraud / and abuse. But these areas only account for 30% of the cost increases. The rest are outside of the control of the facilities management staff.

Everybody looks out into the future and says things can't continue the way they are now. But, they can't see any answers on the horizon," says Robert Reischauer, president of the Urban Institute, Washington, D.C. While most experts agree that the health care systems serious flaws will require serious innovations to correct, "We have a real reluctance to jump off into the unknown," he says. (Haugh, 2002)

Health care reform has been attempted a number of times. The passage of Medicare and Medicaid are the closest the United States has even come to enacting legislation that "reformed" at least a part of the health care system. The attempt at national reform by the Clinton Administration was the fifth such attempt during the 20th century.(Longo, 1993) But now, with the national and international agenda dominated by terrorism and its ongoing threat of biological and chemical warfare, as well as the many ethical issues around cloning and bioengineering, it is likely that health care reform, at least on a grand national scale, will not be realized in at least the next decade.

So, until the public pressure accumulates under the topic of health care reform again, the health care management staff is those who must most aggressively address the crises of rising health care costs. Health care cost inflation and the ranks of the uninsured continue to rise, (Holahan, 2001) and research continues to explore a number of issues that may better inform decision makers as they ponder the future of this fragile commodity called health care. The unknown is exactly what health care faces, says Drew Altman, president of the Kaiser Family Foundation, Menlo Park, Calif. The foundation produced a report documenting various attempts to corral cost pressures. After initial success with each, the upward cost spiral returned.