Trends Affecting Healthcare

By Michael Murillo

The one thing that you can expect in a career in health care is change. The economy, technology, the law and competition are all factors that will affect how an administrator does his or her job. In order to do it successfully, you'll need to understand what areas will require your attention as you gain expertise in your field. Certain issues will become more important than others. Here are some trends that you should be aware of:

Medicare reimbursement

Already a hot topic in locations with a large senior population, changes to Medicare will be very important to administrators. Since Medicare is the insurance program for seniors and the disabled, millions of people depend on it for their health care. That means thousands of doctors, hospitals and other facilities treat those patients and get paid by the government for their services. Congress has been delaying payment cuts to doctors, but if changes are made to Medicare reimbursement these cuts could become a reality and could exceed 20 percent. The impact on the medical industry could be huge and administrators need to be aware and prepared to handle any fluctuations.

Prescription Drug Costs

The growing costs of prescription drugs affect the patients who receive them and the doctors who prescribe them. For example, prescription drug costs can vary widely between name-brand and generic medicine. Administrators need to understand not only the basics of these cost differences, but also how these differences will influence treatment options.

According to Medco's annual drug trends report, which includes data from their top 200 clients, the costs of prescription medicines are rising. While overall drug costs rose 3.7 percent last year, there was a wide gap in the increase between brand names and generics: Brand-name drugs increased more than nine percent while generic prices rose just 0.3 percent. Some attribute this disparity in part to the new health care law, which is taxing pharmaceutical companies and impacting costs for consumers. Regardless, as further changes are enacted, it's even more important that an administrator or manager is watching costs and responding appropriately.

Technology and Business

New technology is vital to every industry, but the health care industry thrives on it. Patients demand faster, more accurate access to treatment, and physicians need the technology that can make their jobs easier. Sometimes this technology is patient-centric like imaging machines and treatment technologies; other times it's behind the scenes like electronic billing and data storage. An administrator is tasked with making sure a hospital, clinic or other practice runs smoothly, efficiently and on-budget, and new technology is an important element in this process.

According to Sue Brody, President and CEO of Bayfront Health System in St. Petersburg, Florida, technology is a subject that students need to understand in order to tackle the demands of their future jobs.

"Information technology is emerging as a key skills set for hospital leadership teams," Brody explained. "Specifically, the nation's focus on electronic health records and other innovations that are being made in the area of medical technology demand a high proficiency and interest in this area."

Although everyone wants the latest technology in every department, a manager must choose to upgrade carefully so the organization can afford the cost and get the most benefit. They have to make decisions that keep the company in business so they can keep serving the community.

Making those decisions requires knowledge of the business side of health care. "While hospitals should always be led by their missions...their leadership must be able to deliver results that make that mission possible," Brody said. In the case of technology, administrators need to understand when to implement something new just as much as they need to be aware of what to implement.

What does all this mean for an administrator? In essence, keeping an eye on the trends affecting health care is as necessary to the job as managing schedules or hiring staff. Without an understanding of the shifts in reimbursement, costs and technologies, it will not be possible for an administrator to effectively manage his or her health care facility.