HEALTH CARE COST CONTAINMENT
Health Care Cost Containment
Health Care Cost Containment
Healthcare cost containment relies on the interventions of the leaders of the organization. They can include the union members who fight for the reduction of cost on the service delivery or the management interventions through policy interventions. Therefore, in this assignment, I will take the position of management to discuss how they can contain cost based on the case study.
GMFC is on the right track by stating that the pressure and competition on the prices is vital for the healthcare organization to reduce the cost of their services in order to remain relevant in the market. In this case, the increased competition in terms of quality healthcare delivery among the healthcare organization would prompt these organizations to strategize on some appropriate ways to make them relevant in the competitive environment (Stabile et al., 2013). One of the strategies that can be employed by these organizations is reducing the cost of its services lower than that of the competitor hence the clients will be driven by the cost in choosing the service of the facility.
Further, the healthcare organization can also differentiate its services and products such that they have a cutting edge over its competitors while maintaining the cost. Therefore, the enhanced healthcare delivery will motivate the patients to use the service of the facility. In so doing, it will guarantee long-term survival and competitiveness of the organization thus the organization will be in a good position to achieve its mission and vision as well as satisfying all the stakeholders such as employees, shareholders, customers and investors in a manner that is efficient.
The idea of the healthcare organization to embrace subcontracting and part-time workers ensures that the organization evades mandatory payments that would have increased the cost of operation hence they would compensate the increased cost by raising the prices of its services to the customers. In this case, when the employees are employed on a permanent basis, there are several benefits that they are entitled in the organization. These benefits include house allowance, health insurance, transport allowance and housing allowance among other benefits. All these are cost takers which increase the cost of operation. In embracing subcontracting and part-time working, the employees that will be working in the activities of the company would be enjoying fewer privileges, therefore, their presence in the organization does not bind them to their work (Tilburt et al., 2013). Thus, in the case of an accident in the line of duty, the organization may not take responsibility for the damages but instead, the entire damage is transferred to the subcontractor who employed the workers in various parts of the organization. This will help in reducing the healthcare cost as the organization will only be concerned with the work performed by the workers in the organization.
Conclusively, containing the healthcare cost lies on the interventions of the management in the organization. Since the management is concerned with the formulation of the policies in the company, they play a significant role in determining the cost-effective ways to reduce the healthcare cost. Some of the intervention that has proved effective includes part-time workers, subcontracting and reduction of benefits. Also, competition among the industry players exerts more pressure on the price hence the cost of the healthcare can be reduced. Therefore, it is the sole responsibility of the management to help contain the cost of the healthcare in all the healthcare organizations.
Stabile, M., Thomson, S., Allin, S., Boyle, S., Busse, R., Chevreul, K., … & Mossialos, E. (2013). Health care cost containment strategies used in four other high-income countries hold lessons for the United States. Health Affairs, 32(4), 643-652.
Tilburt, J. C., Wynia, M. K., Sheeler, R. D., Thorsteinsdottir, B., James, K. M., Egginton, J. S., … & Goold, S. D. (2013). Views of US physicians about controlling health care costs. Jama, 310(4), 380-389.