How Healthcare Strategies Differ from Other Business Strategies - Research Paper Example

How Healthcare Strategies differ from other Business Strategies Introduction A strategy refers to a plan used by organization such as healthcare facilities and businesses to get from a present point to a future essential point in the face of resistance and uncertainty. Both health care and business organizations have different pathways, which defines the achievement of success in such organizations (Moseley 23). Strategies are similar to the rules the manufacturers and designers in a certain organization can do to ensure effective performance. Healthcare strategies are different from other business strategies. This is because healthcare strategies aim at ensuring excellent treatment services to the patients while business strategies aim at maximizing profits and minimizing losses. The main purpose of this research paper is to outline how health care strategies differ from other business strategies (Moseley 23). In health care, which is different from other business strategies, the business days as usual have ended. Around the globe, almost every healthcare facility is putting efforts to cope with the rising cost and irregular treatment quality in spite of the well-intentioned and trained clinicians’ hard work. Health care facility managers and policy makers have attempted numerous incremental fixes, reducing errors, attacking fraud, trying to make patients better “customers”, establishing electronic medical data records, and enforcing medical practice guidelines but none of these measures have had much effect (Moseley 24). The scope of this paper is the management and planning of strategy in certain industries, those that associates with the financing and delivery of health care services in the United States. The term health care in its broad sense includes managed care organization, small group practices, large group practices, academic physician academic, health maintenance organizations, and independent and solo physician practices among others (Moseley 25). Heath care also involves Health plans, Health insurance companies, Community hospitals, Specialty hospitals, Teaching hospitals, Community Health centers, and Multi-specialty group practices. The companies associated with Health care strategy are pharmaceutical companies, DME manufacturers, regulatory public health agencies, biomedical and biotechnological companies, public health financing agencies (CMS), Veterans Health Administration (VHA), and state public health departments. Heath care takes into account all these industries for disbursements approaching a fifth of the GDP (Gross Domestic Product) of the United States. There are many reasons for devoting a research paper for an explanation of the management and strategic planning by organizations in these health care industries. The strategic challenges faced by these health care industries are extremely different from those faced by other business strategies (Moseley 25). Other business strategies face challenges of market competition to maximize profits while health care strategy faces both competition and improvement of patients’ quality services challenges. The strategic negative challenges that health care industries face and the milieu competition are strikingly different from those faced by other economic sectors. In some other health care services do state, federal, and local administrative agencies play considerable a responsibility through financing, regulation, and delivery of direct services. In some other companies are the choices of which services and products purchase, the products and service payments, and usage of those services and products practiced by various different individuals. Despite in other business strategies, the structures, services and products, health care costs, practices, and biotechnological are the scrutiny subjects and the media constant debates, schools, executives, public members, politicians, and professionals. Even though some of the strategic principles and concepts are generic different from other business strategies, it is more essential to explain these strategies in context and terms familiar to the health care system and executives of biotechnology who must apply them (Moseley 25). Environmental factors affecting health care strategy making in biotechnology and health care industries The environmental factors affecting strategy making in other business strategies are different from those affecting the health care ones. It worth to acknowledge some of the essential forces of the external environment, which influence strategies adopted by the health care organizations or which they are virtually supposed to adopt if they wish to be successful in providing quality services to patients (Moseley 26). These influential forces are present in every external environment of an organization although the health care ones are different from any other business organization. Due to the constant ferment present in health care organizations, some of these environmental forces may disappear or weaken completely within a short duration while others will grow to be more influential and stronger. New environmental forces posing negative impacts to the health care strategy will continue to emerge (Moseley 26). Legislative/political- Legislative or political forces affecting health care strategies differ from any other business organization. This is because the political or legislation forces entails that businesses must employ strategies that ensure profit maximization while on the other hand, politics, or legislation entails that health care organizations must adopt strategies, which ensure quality services to the patients (Moseley 26). At both state levels and federal, legislators are implementing different bills to health care organizations designed to offer various types of universal health care services. It is predominantly not essential that a number of US states have seized the plan to come up with personal statewide universal initiatives. Some of these initiatives have been already approved are being put into practice (Moseley 26). Many of the presidential candidates in the year 2008 primarily were arguing about the need of amending or sweeping away all health care reforms. Regardless of who was to win the presidential seat, proposal for effective transformation of the current financial and health care system structure were already in, the legislative schema of the next government. There will be continued regulations on the health care plan activities, which will focus their concern on the abusive treatment of providers and patients, policy disclosure, publication for costs of common procedures and service, authorization coverage of certain specific services to patients and providers, and privacy protection matters (Moseley 27). This strategy is different from other business strategies whereby customer privacy interests are unprotected and the government does not control their strategies. Government in many countries takes the responsibility of controlling strategies that health care institutions must adopt hence making health care strategies to differ from other business strategies whereby business owners control the strategies used to enable profit maximization and loss minimization. The ongoing legislative controls are expected to make efforts in slowing the national health care budget, which is steadily rising hence affecting the poor citizens who are unable to afford such high hospital bills (Moseley 27). Economic- According to other business strategies, when the rate of economic growth decreases the cost of their goods and services decreases respectively (Moseley 26). Although the rate of economic growth wanes and waxes, the budget of the health care facilities continues with its steady climb. Although large amounts of money available for health care expenditure may seem to be an essential factor for health care departments, this trend however raises the possibility of many limitations on compensations under Medicaid and Medicare due to the health care budget constraints (Moseley 26). Demographic/Social-Unlike the other business strategies, the baby Boomer group continues to pave its way to the current population, raising the number of older people requiring the most expensive medical services that are common with the aging people (Moseley 26). What the baby boomers trend contributes is the steady and slow life expectancy improvement of the Americans. The civilization of the entire population and, therefore, potential patients are starting to be more varied. The population’s educations levels however, are increasing at a higher rate; this has a special positive role in transforming the patients’ roles under “customer-driven health care strategy” (Moseley 26). The income rates within populations are increasing, influencing the willingness and ability of people to afford the expensive health care medical services. This trend leads to a three-tiered health care system of care access: publicly insured patients, privately insured patients, and those who are not insured. Patients frequently experience mandatory mobility from a particular health care strategy to another and from one service provider to another, since managers change their health care plan mix and patients change jobs (Moseley 26). The percentage of the population, which is under-insured or either uninsured, is steadily rising. There are however, a shortage of nurses, doctors, and health care physicians, associated with a surplus with physician in certain specialties and some geographical areas. Technology - Unlike other business strategies whereby technology is aimed in making transactions more accurate, easy to accomplish, and for time management, the introduction of these new clinical technologies in health care strategy has been improving operations of health care activities for at least two decades and continues rapidly in areas such as imaging, drug designing, minimizing surgical procedures, mapping and testing of genetically, gene therapy, and vaccinations. The drive is even high for health care information technologies such as Computerized Physician Order Entry (CPOE), Electronic Medical Record (EMR), integrated cost analysis programs, electronic claims processing and filling, telemedicine, and guideline prompts for automated practice (Moseley 27). For service provider organizations, the access to the new advanced medical technologies provides strategic opportunities for competitive advantage gain though often at a higher cost. For the vendors and developers of these new technologies, their products’ markets seem to be promising in future. Industry (competitive) - New drug development and discovery model have resulted in the new health care industry made up of startup and small biotechnology and biomedical companies researching products that are sold or licensed to key pharmaceutical organizations for the purpose of ultimate market introduction (Moseley 27). The consolidation trend among health care strategies, hospitals, and group practices into systems and networks persists in reaction to unrelenting expense pressures and stiff competitions. The strategies of professional health care management, which applies in other business, are working steadily their way into the daily health care organizations running. Those businesses that apply these strategies rather than resisting them will experience their benefits in the short term and acquire at least impermanent competitive benefits over their rivals (Moseley 27). The strategies are frequently introduced first by entities, which are organized as For-Profit organizations and their managers with earlier experience in predominantly For-Profit organizations. The For-Profit culture is changing organizational cultures and managerial decision making in health care institutions (Moseley 26). It is time for new health care strategy The main goals and objectives of health care strategies are to maximize the value and services to patients: this means achieving the paramount outcomes at a fair cost (Osche 52). This is different from other business organizations, which aim at attracting a large number of customers to maximize profits without caring the quality of the products offered to these customers. Health care facilities must step away from a health care system, which is supply-driven and organized around the responsibilities of physicians and towards the patient-based system, organized around the requirements of the patients (Osche 42). Health care facilities must shift their focus from the profitability and volume of providing services-hospitalizations, procedures, physician visits, and tests towards the patients’ achieved outcomes. They must also replace the current fragment system, whereby almost all local providers give a full service range, with a health care system whereby services for a certain health conditions concentrates on health-delivery institutions and in the best locations to offer high-quality care services (Osche 43). Making such transformations to health care facilities is not a one-step strategy but an overarching one. People refer to this as “value agenda” (Sare and LeAnn 25). It requires restructuring how the health care clinics or hospitals manage, organize, reimburse, and measure their delivery. In the year 2006, Elizabeth Teisberg and Michael Porter introduced the “value agenda” in their editions redefining what health care seems to be. Since then, according to researches and work of millions of health care leaders around the globe, the strategic tools ‘for agenda value implementation have developed, and their consumption by health care service providers and other organizations is fast spreading (Sare and LeAnn 45). The changes to health care facilities, which are value-based, are well under way. A number of medical institutions are still at the pilots and the initiatives stage in personal practice areas. Other institutions such as Germany’s Schon Clinic and Cleveland Clinic have gone through several transformations including multiple value agenda components. However, there is no doubt on how to improve the value of care services. The key question is; which health care institution will adopt the way for others to follow at a faster rate? The confront of transforming to a value-based health care organization should not at any given time be underestimated, given the well-established practices and interests for over many decades (Sare and LeAnn 108). This transformation should definitely originate from within the organization. Only provider and physician organizations can allocate the interdependent set of steps required for value improvement, since the ultimate value depends on how the health care practices medical services. So far, every other stakeholder available in the health care system has a responsibility to undertake. Employees, patients, health plans, and suppliers can hurry the transformation, and the entire health care system will benefit from taking such actions (Sare and LeAnn 85). Quality improvement strategies Despite business strategy, which aims at quantity improvement, health care management involves quality improvement strategies. In health care, regular Continuous Quality Improvement (CQI) is practiced interchangeably with the Total Quality Management (TQM). Continuous Quality Improvement (CQI) has been in use as a way of developing health care practices, and focuses on the principle that there is an improvement opportunity in every occasion and on every process (Ginter, Duncan, & Linda 327). Many health care Quality Assurance (QA) programs mainly focus on matters identified by accreditation or regulatory organizations, such as reviewing the oversight committees’ actions, checking documentation, and studying the processes of credentialing. Managers propose other many strategies for improvement of health care services to patients. For instance, many scientists claim that Clinical Practice Improvement (CPI) is a “multidimensional outcomes methodology that has direct application to the clinical management of individual patients” (Ginter, Duncan & Linda 328). Clinical Practice Improvement is an approach used by clinicians that try to come up with a comprehensive understanding of health care complexity delivery , collects data, determines a purpose, uses a team, assesses findings, and then translates this collected data into practice change. From this management, model, and involvement and commitment of clinicians have been believed to be vital for successful change implementation (Ginter, Duncan, & Linda 330). From other strategies of quality improvement, there is a certain prominence in the management need to communicate the purpose, empower staff, and have faith in the project. However, there is no doubt on how to improve the value of care services (Hillestad and Eric 171). The key question is; which health care institution will adopt the way for others to follow at a faster rate? The confront of transforming to a value-based health care organization should not at any given time be underestimated, given the well-established practices and interests for over many decades. This transformation should definitely originate from within the organization. Only provider and physician organizations can allocate the interdependent set of steps required for value improvement, since the ultimate value depends on how the health care practices medical services (Hillestad and Eric 178). So far, every other stakeholder available in the health care system has a responsibility to undertake. Employees, patients, health plans, and suppliers can hurry the transformation, and the entire health care system will benefit from taking such actions (Hillestad and Eric 205). In health care system strategies, which are dissimilar from other business strategies, the business days as usual have ended. In the entire world, almost every healthcare organization is trying to come up with essential strategies, which will fight the irregular treatment services and increasing health care cost despite the availability of well-trained nurses, clinicians, and doctors (Ginter, Duncan, & Linda 76). Health care organization instead of finding ways to maximize profits are putting efforts to cope with the rising cost and irregular treatment quality in spite of the well-intentioned and trained clinicians’ hard work. Health care facility managers and policy makers have attempted numerous incremental fixes, reducing errors, attacking fraud, trying to make patients better “customers”, establishing electronic medical data records, and enforcing medical practice guidelines but none of these measures have had much effect (Ginter, Duncan & Linda 87). The government is however ensuring that health care organization incorporates health care strategies, which will ensure that patients receive high quality medical services at a low cost. This makes health care strategies differ from other business strategies since they incorporate strategies, which sometimes increase the cost of their services and products with the aim of maximizing their revenues (Ginter, Duncan, & Linda 215). Conclusion In conclusion, health care strategies are extremely different from other business strategies. Both health care and business organizations have different pathways and different strategies, which define the achievement of success in such organizations. Strategies are similar to the rules the manufacturers and designers in a certain organization can do to ensure effective performance. Healthcare strategies are different from other business strategies because health care strategies aim at ensuring excellent treatment services to the patients while other business strategies aim at maximizing profits and minimizing losses. The entire content of this research paper was to outline how health care strategies differ from other business strategies. Work cited Ginter, Peter M, W J. Duncan, and Linda E. Swayne. Strategic Management of Health Care Organizations. San Francisco, CA: Jossey-Bass, 2013. Print. Hillestad, Steven G, and Eric N. Berkowitz. Health Care Market Strategy: From Planning to Action. Burlington, Mass: Jones & Bartlett Learning, 2013. Print. Moseley, George B. Managing Health Care Business Strategy. Sudbury, Mass: Jones and Bartlett, 2009. Print. Osche, Thomas. Communication Strategies for Product Recalls in the Health Care Business. München: GRIN Verlag GmbH, 2010. Internet resource. Sare, Michele V, and LeAnn Ogilvie. Strategic Planning for Nurses: Change Management in Health Care. Sudbury, Mass: Jones and Bartlett, 2010. Print. Read More