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February 1997
Outlook 1997: Batten Down the Hatches.
McLaughlin, N (Senior Editor), et al.
Modern Healthcare: Jan 6, 1997. 39-54.
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[ no abstract available ]
While ushering in 1997, it is interesting to consider the predictions and projections offered by observers of the healthcare system in which we work. Mr. McLaughlin, a senior editor for Modern Healthcare, compiled predictions for the upcoming year from experienced writers related to a dozen major segments of the healthcare field. The 12 segments reviewed and the major points from each contributor are presented below. Each has significant bearing on the anesthesiology practitioner.
Systems
Healthcare systems can expect increased scrutiny of integration efforts by the community. We will see growing fiscal pressure to make integrated systems function effectively. Growing market pressures will intensify the friction between health plans and providers.
Investor-owned Chains
Not-for-profit hospitals will be more difficult to acquire by investor-owned companies. Acquisitions will involve largely facilities located in rural areas, and troubled hospital companies.
Finance
Pressure to cost-cut will continue. Creating more non-operating income will become a greater priority. Some of the larger not-for-profit healthcare systems may form employee stock ownership programs.
Construction
Construction, especially renovations, will increase as a result of managed care, mergers and acquisitions. Full-service development companies will be utilized increasingly for integrated approaches to construction, including financing, design and property management. The aging population will demand greater emphasis on continuing care beyond the traditional healthcare facility.
Governance
Larger chains will continue to engage in mergers, and more legal challenges to these activities can be expected. Governing boards can expect increased scrutiny of foundations formed by for-profit organizations.
Managed Care
The mergers by HMO's may trigger roadblocks to further consolidations. Traditional indemnity insurers will continue to sell to managed-care companies. HMO's can be expected to raise prices due to decreased profits and limited markets, and in the process attempt to distinguish (and distance) themselves from their competitors.
Purchasers/Payers
Buyers and sellers of healthcare may compromise to assure quality and outcomes. Contracts directly between purchaser and provider may result from purchaser-insurer friction.
Medical Groups
Hospitals and clinics will launch physician practice management companies in an effort to maintain control. Favorable antitrust guidelines will enable physician networks to grow. The oversupply of new physicians and the decreasing Medicare budget will represent significant issues during the upcoming year.
Post-acute Care
Diversification in services beyond the hospital will be a growing strategic issue for providers, leading to greater competition in this arena, with associated consolidation and reimbursement challenges.
Information Systems
Internet technology will help solve some of the problems inherent in healthcare information systems. Healthcare executives will have to make choices between expensive conventional technology vs. unproved technology.
Human Resources
Organized healthcare labor will continue to take an activist stance, with unions targeting Columbia/HCA Healthcare Corp facilities for organizing efforts, and with traditional healthcare unions experiencing challenges from other unions.
Purchasing
Suppliers, buyers and group purchasing organizations will concentrate on consolidating economic gains derived from their growth.
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