Question

Whats a current financial or economic issue in the health care industry?

Answer 1

In order to survive, on a daily basis, the healthcare industry face a lot of challenges especially related to financial issues. Interestingly, such challenges persist throughout the globe for the healthcare industry. Let us have a look at them –

The healthcare industry is in constant need for finances. And why not? As healthcare laws keeps on changing and demands from patient increases, the industry need to adapt to such changes for which constant flow of money is a necessity. And we all know it isn’t easy to have access to a continuous flow of money.

By the way, technology is now being applied heavily in the medical field. And a lot of transformation and innovation is taking place in such a field. Needless to say, that it’s required to improve patient outcomes. And more money is required to implement such technologically enhanced medical devices. But, not all hospitals can make the most of this new medical technology due to cost constraints.

Therefore, an array of mergers and acquisitions are taking place in the healthcare space. Undoubtedly, mergers result in economies of scale. So, the company will have a chance to increase its level of production but more importantly decrease its costs. However, there is immense pressure from government organizations to make the deals transparent and legitimate. Such pressures along with difficulty in finding the right clinical talent, is surely making life difficult for the healthcare industry.

The National Association of Health Underwriters (NAHU) had already said that staffing will be a big headache for the healthcare industry. NAHU stated that there will be a shortage of 3.5 million healthcare providers by 2030. And with lesser number of healthcare providers fewer numbers of patients will get the required care.

Talking about rules and regulations, the healthcare industry need to make sure they carry out all the necessary compliance requirements. Or else, they will surely land in trouble and their reputation will be at stake. At the same time, they need to set aside separate funds to meet compliance guidelines eventually leading to an increase in cost.

Having said that, the healthcare industry has also applied several cost cutting techniques to boost profit margins. The management has started to lease or rent high-tech equipment, outsource services and share resources with other healthcare providers. Thus, even though there are many financial issues plaguing the healthcare industry, they are ready to take up the challenge.