Q1. The market driven approach is pure capitalism versus government intervention which combines capitalism and socialism.
Rick Scott applied the market driven approach to the problems, in the health care system that already existed over half a century ago. The gist of the problem is healthcare costs. Mr. Scott was successful in marketing and promoting healthcare in the United States and making it a successful economic enterprise.As is true with all market approaches and with pure capitalism, in the health care industry, there are always issues between a successful business model and the best healthcare that can be available for the American people. The issue truly is whether healthcare should be part of the American capitalist system or part of a government run program to ensure the best quality of healthcare. Mr. Scott and total government intervention are at opposite ends of the spectrum.
Based on Rick’s background, he wanted to find a balance between costs and profits, so he came up with the idea of a for-profit form of delivering medical services by applying unethical practices to create savings and efficiencies. Mr. Scott without question achieved the economies of scale that he yearned. Excellent health care at an affordable price cannot be the focus for increased profits.
Companies have to make a measured amount of profit that compensate investors risk of capital; however, health care has to be evaluated from a different perspective, different from the automotive, tourist or retail industries, just to mention a few.Rick Scott with his visionary spirit found another venture capital where he invested in a chain of retail health care clinics, which are located inside Florida Wal-Marts. You don’t need an appointment and you can chose from a range of services from X-rays to blood tests, even physicians are present. These clinics helped Rick Scott find the gray spot where care quality and efficiency can provide a measured profit seeking enterprise.
Q2. Healthcare should be a basic right for a country’s tax payers.President Obama had campaigned on the proposition that healthcare is a basic right for all US citizens. As president, Obama appears intent to successfully implement this campaign pledge. However, the United States is facing an outpouring of money to support two wars and the economic problems facing the country. All of these expenses raise the question whether we can afford universal healthcare and continue providing our basic assistance to the American people.
This problem is an age old problem that has confronted all of our presidents. What has changed is the cost of universal health care.The cost of unlimited treatment clearly is prohibitive. However, unlimited treatment should be considered a commodity and governed by market mechanism, while limited treatment should be provided by efficient government regulations. The government can provide certain basic protection but private industry and private initiative must intervene to provide more comprehensive healthcare.
It is possible we can strive to achieve a modified universal healthcare system; the obstacle is its cost. The government should account for healthcare in its taxation system.The government must evaluate its use of tax dollars and ration a larger portion to healthcare cost and a smaller portion to miscellaneous projects. Q3.
The strategies behind HCA’s rise are attributed to the market capitalism model of the business government and society relationship. Scott’s desire of the market share turned his two facility start up business in El Paso, Texas into a chain of hospitals and home care services throughout the United States. Yes, his strategies were fundamentally flawed because the healthcare industry should not put a dollar sign on its customers, those in need of medical care.Though, he was acting in the best interest of the shareholders, by increasing wealth through decreasing costs, his actions led to ethically wrong practices. For example, one hospital administrator requiring green cards before providing any healthcare, the purchase of cheap medical gloves, the up coding, and the cruise incentives.
Finally, his business model was unworkable because there were just too much unrealistic demands on management to “corners are cut” to make a profitable business even more profitable. Q4.HCA attempted to use healthcare resources more efficiently than its competitors by combining “efficient” use of the healthcare resources and compromisation by shifting costs to patients and staff, incentivizing physicians and administrators to steer patients (illegal) into equity owned physician facilities, upcoding, allowing inappropriate staffing levels, and buying inferior supplies for maximum profit.
Those actions are unethical in the healthcare setting and ultimately lead to the discovery of Medicare fraud. As HCA has illustrated, the sole use of unadulterated business practices does not work in the healthcare environment.Healthcare cannot be driven solely by financial incentives; a principal stakeholder, the patient must be taken into account. Making use of business practices where they could stand alone in healthcare, such as the refinancing of debt after an acquisition could have been a smarter way to build the business.
In addition, gaming a problematic Medicare system and paying out unprecedented bonuses/dividends to partners will make any healthcare provider a target for suspicion and subsequent investigation. Q5. The difficulties that HCA experienced could have been prevented implementing and enforcing a policy of quality standards vs. uantity of billings. The point in time to salvage Mr. Scott’s enterprise would have been, ideally, the beginning, or at the very least the point when the company was growing by acquiring numerous hospitals and other health care providers. Scott should have instructed his management team to develop an ethics program thereby establishing a code of ethics throughout the corporation.
The acquisition of home care facilities was a conflict of interest and by not having invested in these facilities public scrutiny would be lessened.Measures should have been put in place to make sure than when managers were cutting cost to meet Scott’s expectation, they weren’t doing this at the expense of quality service. This was evident when managers were cutting back on staff and sometimes buying inferior equipment which resulted in longer waiting time for test results which also meant longer waiting time for patients. The incentives for doctors used such as Caribbean cruises for admitting the most patients on slow weekends were bound to be looked upon in a negative manner and should have never been used.
The culture of the organization needed to be one which valued providing quality healthcare; instead it was one where maximizing profit was the culture. If the culture of the organization was different from the start, then that would have trickled down to managers and employees. Hence, HCA wouldn’t have faced many of the problems that brought shame to its operation and the industry. September 22, 2009 HCA Case Analysis Christian Agila Kevin Anderson Luis Montenegro Tamara Sutton Dominique Turgot