In the past few years alone, we’re seen politicians argue the nuts and bolts of a national health care plan, and we’ve seen insurers — public and private alike — struggle with balancing premiums and plans with exchanges and actual service.
All this at a time when the growth of the health-care industry in the U.S. is exploding. On its own, health-care spending makes up one-sixth of our economy, topping out in 2017 at around $3.5 trillion. With an aging population, among other factors, there’s no sign this sector will wane any time soon — in fact, in 2018, it is expected to rise by 5.3 percent.
This is good news for job-seekers — but what does it mean for corporations and organizations currently navigating this sector and all the changes to come? Are professionals traditionally trained in providing health-care services really ready for managing big business issues?
Most discussions at political and policy levels deal with utilization — how to get more people into preventative care and fewer using ERs. However, a recent study in the Journal of the American Medical Association suggests the main reason our health-care spending is roughly twice any other industrialized nation is not utilization — our rates are roughly comparable to other high-income countries — but rather the cost of labor (doctors and nurses), goods (including pharmaceuticals and devices) and administration.
To remain viable through the next wave of the health-care evolution, established companies must be inventive, resourceful and business-minded — with an eye toward implementing new, cost-effective technologies, outsourcing production, or using widely available capabilities, such as the Internet, in new ways.
Who better to craft new solutions for health care than professionals trained in entrepreneurial thinking and the foundations of business? The transformative power of new processes, new technologies and new creative combinations of capabilities are the backbone of what we teach in the Healthcare Management program in the Eller College of Management at the University of Arizona.
When business joins forces with medicine, benefits abound, both in terms of return on investment and on patient care.
For example, an interdisciplinary group of our business and health-care graduate students worked with Banner Health to examine the costs and benefits of pharmacogenomic testing. Relatively inexpensive genetic tests can identify patients for whom drug therapies are likely to be ineffective or adverse. When and for what diseases or drugs these tests should be used as a prescreen can be assessed from a cost effectiveness perspective. Business meets health science to advance patient care and reduce costs.
Stephen Gilliland holds the Peter and Nancy Salter Chair in Healthcare Management in the Eller College of Management at the University of Arizona. He is hosting “The Future of Healthcare” panel on May 31 at 8 a.m. For more:eller.arizona.edu/hcfuture.