Consumer-directed health care promises to reduce costs and increase quality by expanding provider choice for prospective patients. High-deductible insurance, or employer-subsidized health savings accounts to help improve price transparency and accurate information about the clinical performance generate millions of patients shopping for health care. As in any other market behaved when patients shop, there is a relationship between financial reward and value for the individual patient. Absence of the price … Read more »

Consumer-directed health care promises to reduce costs and increase quality by expanding provider choice for prospective patients. High-deductible insurance, or employer-subsidized health savings accounts to help improve price transparency and accurate information about the clinical performance generate millions of patients shopping for health care. As in any other market behaved when patients shop, there is a relationship between financial reward and value for the individual patient. Absence of price competition, agency problems and high barriers to entry in the local markets are market failures that currently you break this link in U.S. health care system. Consumer-directed health plans are already popular with many employers and have a dynamic which indirectly characterizes the debate on the reform of the Obama administration. Complexity of reporting clinical results, the dependence of the treatment effect on at-home patient behavior and scientific ignorance among consumers threaten delivery of results promised by the theory. Successful implementation requires attention to control sophisticated data reporting that fits for clinical risk, avoidance of patient-oriented marketing that excessive consumption leads and adequate funding of health savings accounts. At the end shifts the place of execution control health system costs by shifting negotiations between employers, providers and payers to newfound purchasing power of potential patients.
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from
Philip T. Powell,
Ron Laufer
Source: Business Horizons
12 pages.
Release Date: 15, March 2010. Prod #: BH378-PDF-ENG
The promises and limitations of consumer-directed healthcare HBR case solution

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