I attended an educational session yesterday and the title was "Healthcare Inflection.” The basis for the session was the extensive disruption that is occurring and will continue in what has been a legacy industry (health care) that has been rarely impacted by such disruption. The presenter made a statement that if hospitals don't change, they will fast become what had become of the steel industry a few decades ago. Simply put, that industry couldn't compete with China on price for steel.
Hospitals will be impacted by not only price competition, but also brands coming from retail entities (i.e. CVS, Walgreens, Target, etc.) and the access, convenience, technology, quality and level of satisfaction by these same retail entities. Large chain pharmacies have expanded into health care's territory of primary care with the intention of disrupting the longstanding relationship between patients and their doctors and hospitals. This disruption has also impacted the cash flow. For the most part, hospitals don't know what their prices are in so many areas, but Walgreen's does. Registration at Walgreen's for their retail clinics or primary care is same day and is done through kiosks. When you arrive, you enter your information and you are assigned an appointment for that day.
Retail is counting on the ability to keep prices low and that they will then have a consumer for life. Of course, brand, technology, convenience, access, quality and satisfaction are important, but price is key. As an industry, hospitals have a lot of work ahead of them.
Hasn't it always been this way in the medical field? The patient never knows what the cost of a procedure or test is, until they get a bill. What other industry does this? Even Dental or Vision can give you an estimate before performing a test or procedure. .
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