Hospital Services Market - Assignment Example

Unit 6 Hospital Services Market Definition of cost shifting Cost shifting refers to the use of discriminative pricing strategies for different patients (Reinhardt, 2006). Medical practitioners charge some patients more, but charge others less for similar services. This emanates from the ability of a certain group of people to meet their health costs without financial strain, as compared to others who struggle to meet the payment. Status of cost shifting In my opinion, cost shifting promotes equality in society. It serves to aid patients who may not have the capacity to cater for huge medical expenses (Scott, 2009). When hospitals charge some individuals more for their health needs, the hospitals are compensated for the costs they incur in treating patients who find it difficult paying for the services. Consequently, the practice should be continued as it promotes wealth redistribution. Why a change in a hospital’s variable costs can change the hospital’s profit-maximizing price A hospital’s profit maximizing price refers to the amount charged to patients, and which allows the healthcare organization to earn an amount greater than the total cost of the service rendered to the patient. Therefore, an increase in the cost of the service offered may alter the profit margin expected by the organization. If the variable costs, for example, increase, and the profit-maximizing price remains constant, then the organization’s profits get lowered. On the other hand, a decrease in such variable costs increases the profitability level of the hospital, if the profit-maximizing price remains unaltered. This follows the reduced expenses, which provide the hospital with a greater profitability margin. Part 2: The following table shows comparative data for three hospitals, and North Carolina and U.S. national averages. Table 1: Comparative data Ashe Memorial Hospital Alleghany County Memorial Hospital Watauga Medical Center North Carolina Average US National rate Proper nurse communication 86% 85% 75% 81% 79% Proper Doctor Communication 90% 82% 83% 83% 82% Provision of prompt response when needed by patients 79% 79% 62% 68% 67% Giving explanations about medicines before giving it to patients 68% 72% 61% 65% 64% Patients giving the hospital a rating of 9 or 10 on a 0-10 scale with 0 being the lowest rank 78% 77% 62% 71% 70% Patients who could recommend the hospital 75% 76% 64% 71% 71% Ability to receive lab results electronically Yes Yes Yes Ability to track patient’s lab results and referrals electronically between visits Yes No Yes Rate of unplanned readmission for heart attack patients Small Small 18.3% 18.3% Average number of minutes before outpatients with chest pains or possible heart attack who get an ECG 10 Not available 8 7 7 Outpatients with chest pain or possible heart attack who got aspirin within 24 hours of arrival 99% Not Available 100% 97% 96% Average time patients spend in the emergency room before they are seen by a healthcare professional 43 18 25 36 26 Heart failure patients given discharge instructions 90% 100% 95% 96% 94% Patients assessed and given pneumonia vaccination 95% Not available 92% 93% 91% Death rate for heart failure patients 11.7% 11.7% 11.7% 11.7% 11.7% Death rate for pneumonia patients 11.9% 11.9% 11.9% 11.9% 11.9% (Medicare, n.d.) Patient satisfaction measures Communication plays a key role in keeping patients satisfied with a healthcare organization. The nurses and doctors of Ashe memorial hospital maintain efficient communication with their patients, which makes them more satisfied with the services offered to them. However, nurses of Watuga medical centre do not take their communication role seriously, as it falls below the average rate of North Carolina, as well as the national rate. Such communication leads to low satisfaction among the patients, and may affect negatively on their health outcomes. Failing to, for example, give explanations to patients before giving them their medication can also lower patient satisfaction as they get to take the medicine, without the necessary information about the drugs. The level of patient satisfaction can be measured by, such factors as the probability of a patient to recommend the organization in question to another person. Ashe memorial hospital ranks highest in this category as 77% of the patients surveyed would recommend the hospital to another patient. Alleghany County Memorial Hospital follows with 77%, meaning that most of the patients who visit the two hospitals find them worthwhile. Watauga Medical Center records a lower patient satisfaction rate as the percentage of people who would recommend the hospital to others falls at 62%. Quality of care The three hospitals use electronic systems to assist them in delivering services to their patients. Consequent to this, the hospitals provide better care to the patients as electronic systems improve the safety of patients. This follows the reduction in time taken to perform various activities, thus improving the time taken to attend to a patient’s need for attention. However, Alleghany County Memorial Hospital does not access lab results and referrals of patients between visits electronically. Therefore, the hospital takes more time, compared to the other hospitals to deliver the required services, which could compromise on the quality of care given to patients. Prompt response contributes to the delivery of quality care in a health organization. Ashe memorial hospital provides their patients with 79% rate of response, which coincides with Alleghany county memorial hospital’s rate. The two hospitals record a quick response rate to patients, which improves the quality of care given to the patients. More to this, the rate exceeds the average rate of the state as well as the national rate, which means that the two hospitals provide credible healthcare services. On the other hand, Watuga medical centre records a 62% rate of quick response, which falls below the national rate of 67%. Consequent to this, it can be inferred that Watuga medical centre provides poorer quality of services, compared to other hospitals in the nation. Mortality rates Ashe memorial and Alleghany county memorial hospitals readmit very few patients treated for heart attack. This means that they offer their patients quality care, thus improving the mortality rates associated with such patients. On the contrary, Watuga medical centre receives readmissions equivalent to the national rate. Consequent to this, Watuga medical centre can be termed as an institution that does not improve the mortality rates of such patients. Following the uniform death rates for patients diagnosed with heart failures, as well as pneumonia, the three hospitals seem to experience these deaths due to forces beyond their control, and not the quality of care they give to their patients. References Medicare. (n.d.) Compare Hospitals: General Information. Medicare. Retrieved from: http://www.medicare.gov/hospitalcompare/compare.html#cmprTab=0&cmprID=341325%2C341320%2C340051&loc=28640&lat=36.3977815&lng=-81.4169093&AspxAutoDetectCookieSupport=1. Reinhardt, U. (2006). The Pricing of Hospital Services: Chaos behind a Veil of Secrecy. Health Affairs. Retrieved from: http://content.healthaffairs.org/content/25/1/57.full.pdf+html. Scott, R. 2009. The Direct MedicalCosts of Healthcare-Associated Infections in U.S. Hospitals and the Benefits of Prevention. The Centers for Disease Control and Prevention. Retrieved from: http://www.cdc.gov/hai/pdfs/hai/scott_costpaper.pdf. Read More