Presented by : Kinana Shaker Kawas ID# 20421111 The Corporate Transformation of Health Care, Part 1: Issues & Directions J. Warren Salmon Presented by : Kinana Shaker Kawas ID# 20421111

Outline: Introduction Highlight the main points in the article Generic Drug Discount Programs Conclusion

Introduction Being a health care provider ( physician, pharmacist, etc): Profit Vs Patient care Moral, Ethical? Social obligation to care for poor ppl? How many Dirhams u make Vs # of patients you treat???

Dr. Salmon’s article pointed out: The Rise of the medical industrial complex The entry of corporate health providers Levels of transformation

The Rise of the medical industrial complex In the past two decades a dramatic alteration in the organization, financing and delivery of medical care occurred in the united state. Due to the flow of funds from the Health care insurance companies i.e.; Medicare and Medicaid, Centralization of the capital began to develop in the health sector.  MIC MIC has now taken grip over most of the American Health care endeavor and has encroached up the “ Not for Profit “ and public providers as well. The health care sector is undergoing further Industrialization particularly in its organizational and administrative functions.

The entry of corporate health providers The entry of large scale profit firms into the delivery of services was delayed until the late 1960s when the politics, social, and economic conditions in the health sector changed. Their aim was to reverse existing public policy concerns for social equity in health care.

The Main Aim: How to increase their Profit margin using patients as a method!! cost Profit Scale of operations

In their mid 1980 they suffered from a decline??? Miscalculation of changing policy conditions Managerial difficulties in assembling resources and talents to carry out their strategies.

Levels of transformation 1- reduce the subsidization of hospital care for those unable to pay They have engaged in “ Corporate take-backs) by: Lessen the health insurance benefits Cutting recipients Forcing greater cost sharing by employees Reduce health providers payments Remove the public health supporting programs Come up with new policy of a direct “tax” for catastrophic cases

Levels of transformation Bulk workers will have 75% health insurance coverage while smaller workers wont have any!! The actions from level 1 transformation led to patients dumping; an economic transfer of patients from private to public hospital due to money reasons.

Levels of transformation 2- Corporatization of medicine; emergence of large scale health corporations( investor-owned or not for profit) hospital chains plus federations plus nationwide health maintenance organizations to integrate and take hold of larger market shares of the better insured people.

cont’d Public hospitals, urban voluntary and small rural hospitals that have tried to serve the minority, poor and aged people all across America have been closing since the 1970s. A comparison between the decline of the public sector of delivery of health and the growth of the “ For-profit sector” represents an economic condition of underdevelopment among development social inequity.

One way to save patients money is to apply the Generic Drug Discount Program This program saves patients Billions of dollars and, they also cut into pharmacies' gross profit margins. It offers more publicity to the pharmacy. It is profitable but not as before because will not be have a revenue from the PBM( Pharmacy Benefit Management) on these prescriptions. For example; on a 4$ generic drug, the pharmacy may spend 75 cents to purchase and process the product resulting in a profit margin of 3.25$ per prescription but this is too low to receive a reimbursement from the PBM and in past they used to receive $15 or $20 from the PBM.

Cont’d Generic drug discount force pharmacist to become more efficient and to use technology to gain money but pharmacists get conflicted between Professional Philosophy Vs Business. To maximize the profit margin by using this program you should use it correctly by : Decide whether to charge enrollment fee or not. Decide to offer 30-day supply or 90-day supply Choose the right mix in a generic drug program. A 30-day program is a little simpler and there is greater participation while with a 90-day supply, the pharmacist touches the product fewer times so improve efficiency.

Summery: Health care sector in the US has transformed from “ Not for profit” to “ for profit” delivery services on national and local levels led to a decline in patients care services. ( industrialization) Political and economic conditions reversed the organization of the social functions and led to corporatization of medicine. The social obligation to care for the poor, sick and disabled has withdrawn with the rising of the MIC. Many health workers still believe in their charitable values toward patients but more do the opposite; they accept and capitalize upon the new conditions for profit making. Generic drug discount program is very useful for both patients and pharmacist as long as it is applied in a correct way.

Conclusion: We should have a moral responsibility to serve people’s need regardless of ability to pay. Health care service should be available to everyone. Our primary concern as a health care providers is the Patient care outcomes and how to improve his QOL. The best way in the health sector is to make a balance between revenues and patient care.

References: The corporate Transformation of health, Part 1: issues & Directions, J.Warren Salmon, Editor Baywood Publishing Company Inc., Amityville, N.Y.,1990. http://drugtopics.modernmedicine.com/drugtopics/Pharmacy+news/Generic-drug-programs-cut-into-pharmacy-profits/ArticleStandard/Article/detail/576178?contextCategoryId=47448