Avalere research demonstrates business model point

TalkBack 1 of 7:

Next »

• Thread View
• Flat View

Call it "subsidized fee for service"

The existing system is not a pure fee for service system (which IMHO would be sustainable). but a fee for service system subsidized by employer and government provided health insurance. Since the price of anything is directly proportional to the perceived buying power of the clientele *and* because most patients have little or no idea what the services they are using actually cost, physicians and hospitals can afford to charge more *and* (this is the insidious part) their suppliers can afford to charge much more than if everyone was paying for routine care out of pocket. So, pharmaceutical companies can charge more, medical suppliers can charge more, medical schools can charge more (graduates can afford more expensive student loans), malpractice insurers can charge more, etc. ad nauseum.

This sort of business model *is* untenable and will be replaced with something. The important debate is about what the replacement will look like. Something closer to an unsubsidized fee-for-service model would be my preference, but it might cause mass suicides among those dependent on the current high cost of medical care (because costs would drop drastically).

Posted by: John L. Ries   Posted on: 03/11/09  (Edited: 03/11/2009 @ 03:06) You are currently: a Guest | Members login | Terms of Use

Alert moderator to an offensive message

Subscribe to this discussion via Email or RSS

SponsoredWhite Papers, Webcasts, and Downloads

• The True Costs of Virtual Server Solutions VMware In an economic environment that is repeatedly heralding the message "do ... Download Now
• VMware Infrastructure: A Guide to Bottom-Line Benefits VMware Frustrated by the costs of maintain ever larger data centers?or building ... Download Now
• Five Steps to Determine When to Virtualize YourServers VMware Server virtualization isn't just for big companies. Entry-level ... Download Now