Hospitals Negotiating Leverage

In the early- and mid- 1990s, hospitals were under pressure.  Managed care was taking off and forcing hospitals to reduce prices.  These managed care plans had the upper hand because: Competition between hospitals was intense.  Each hospital had to fight to secure contracts from managed plans in order to direct large chunks of patients to their…

PPS and Competition

Prospective Payment Systems (PPS) and competition go hand in hand.  Without competition, a PPS gives hospitals and physicians the incentive to minimize health care outlays.  A competitive fee-for-service (FFS) system-to which most Americans were accustomed to in the 1980s-can lead to severe cost increases due to the problem of moral hazard.  Combining PPS and competition…

Physician-Patient email communication: a review

We are now in the information age. Let’s take a look at the following numbers: Internet World Stats reports that approximately 70% of Americans now have access to the Internet. (This puts it 7th in the world in terms of Internet penetration). Over 85% of physicians have access to high speed internet in their offices.…

The Cost Effectiveness of Nurse Practitioners

Many studies have claimed that Nurse Practitioners (NPs)–as well as Physician Assistants (PAs)–are adequate substitutes for primary care physicians.  Researchers claim that NPs can perform a great majority of the tasks currently carried out by primary care physicians, and should be used more frequently since NP and PA salaries are usually half of primary care…

Do we need specialty hospitals?

According to the Milwaukee Journal-Sentinel (“Orthopedic hospital…“), the Orthopaedic Hospital of Wisconsin posted profit margins of 52%.  The article claims that the healthcare industry generally only has profit margins of around 3%-5%.  Does this mean that the Orthopaedic Hospital of Wisconsin is providing highly valued services?  Is it good at cutting costs?  Or is it…

‘Price Check, Neurology Wing’

“People generally don’t have a clue about what the health care they are consuming costs,” Michael O. Leavitt, the Secretary of Health and Human Services told reporters in a WebMD article (“Gov’t releases hospital prices“).  With a new initiative in hand, Mr. Leavitt hopes that consumer ignorance will soon dissipate. Yesterday, officials at the Centers…

Attention Shoppers

Can consumer-driven health care (CDHC) really work?  According to the New York Times, many entrepreneurs believe it can. In “Attention Shoppers,” the newspaper details how Wal-Mart, CVS and other chain stores are opening walk-in health clinics. The clinics are staffed by Nurse Practitioners and operated independently of the chain store. The benefits of the walk-in…