An Investigation of the State of Affairs in Competition and Opportunities in Healthcare

An Investigation of the State of Affairs in Competition and Opportunities in Healthcare

Background of the study

As technologies in healthcare advance, the business environment becomes more complex. Therefore a prediction of the interactions of different forces in the environment becomes difficult. Further, most people have access to higher education; thus, securing employment may not be as easy as it was in the last century.  The study purposes to examine two forces; competitions and opportunities and declare a profitable path for prospective graduates. Such information will also advise students on the skills needed to be competitive in the contemporary healthcare industry.

Hypothesis

Null Hypothesis: There is stiff competition in the contemporary healthcare industry.

Alternate Hypothesis: the completion in the contemporary healthcare industry is not stiff.

Methodology and Results

The research will make use of secondary data sources. Peer-reviewed journals, articles, and periodicals will be reviewed to examine the level of competition in the industry. However, the review will be limited to sources published between 2010 and 2020.

Market competition

There is little competition in the health insurance industry (HHI). Hyde (2016) observes that the number of insurance mergers and acquisitions have been on the rise from the recent past. Such partnerships leave the HHI with a few consortiums of insurance companies. Therefore, the quality of health standards is likely to deteriorate due to minimal competition. The most explicit immediate effect is the rise of insurance premium rates in the United States. For instance, Adamczyk reveals that the cost of insurance premiums for family cover has increased by approximately 22% since 2016 (2019). Therefore, due to minimal competition, a few mergers are exploiting the citizens through covers. Since these firms are large, entry of new firms into the business may be met by stiff competition. In the end, low-quality covers may results as the few firms are profit-oriented.

The competition in the hospital industry is also minimal. Glied and Almart (2017) established that the government of the United States is worried about the low levels of market competition in the industry. They further admit that the competition is still decreasing over time. The argument is further enhanced by Gaynor, Mostashari, and Ginsburg, who reveal that citizens are paying exorbitant amounts of money to doctors who offer substandard services (2017). Between 2012 and 2015, the employment of physicians in hospitals increased from 26% to 38%. Such practice reduces the competition from private physicians. Therefore, the problem is not legislative but caused by competition. As such, the Affordable Health Care Act cannot remedy the situation.

Market opportunities

The remedy to improve US health care is increasing the competition. The Affordable Healthcare Act cannot address consumer exploitation without other competitive health providers. Therefore, as a medical graduate, one should focus on private practice. The measure is to increase the number of physicians running their facilities. Therefore, students should concentrate on hand-on skills that contribute to high-quality healthcare. Another unexploited market niche is health insurance covers. Consequently, a business student should be conversant with present-day policies on insurance. Such skills enable them to advise a client on the most feasible insurance covers to acquire.

Conclusion

The competition in the United States healthcare is somewhat mild. Therefore, the alternate hypothesis is valid. Further, opportunities in private practice and insuring are yet to be tapped.