Strategic Management in Healthcare

Select ONE of the discussion questions to answer below.
Discussion Question I
Describe the steps in a rational process for service area competitor analysis. Why is service area competitor analysis an important aspect of
environmental analysis?
OR
Discussion Question II
How does an organization achieve a competitive advantage?

Sample Solution

Strategic Management in Healthcare
In business, a competitive advantage is the attribute that allows an organization to outperform its competitors. It is the ability gained through attributes and resources to perform at a higher level than others in the same industry or market [Christensen and Fahey 1984, Kay 1994]. A competitive advantage may include access to natural resources, such as high-grade ores or a low-cost power source, high skilled labor, geographic location, high entry barriers, and access to new technology. There are three strategies for establishing a competitive advantage: cost leadership, in which the objective is to become the lowest-cost producer; differentiation advantage, in which a company’s products or services are differentiated from that of its competitors; focus, whereby a company focuses on a narrow target market segment. A competitive advantage distinguishes a company from its competitors. In today’s world, it is essential to business. Without it, companies will find it difficult to survive.

requirements.
Medicaid covers approximately forty percent of adults with opioid addiction, making demonstration waivers that adequately address opioid addiction a necessity.13 New Mexico’s waiver to treat enrollees with opioid use disorders with federal funding was recently extended for five years.16 In this waiver were authorizations to increase copayments for inappropriate emergency department use or high-cost drug utilization, to increase premiums, to terminate coverage for failure to pay premiums after a three-month period, and to eliminate retroactive coverage for new enrollees. 16 Stakeholders include Medicaid beneficiaries, the state of New Mexico, and Medicaid beneficiaries with opioid or other substance abuse disorders. Medicaid beneficiaries without a substance abuse disorder will lose substantial coverage if unable to consistently pay premiums and spend higher percentages of their total income on copayments if unable to meet new requirements; these stakeholders will only benefit from health coverage if they are able to meet the new requirements. Medicaid beneficiaries with opioid addiction or other substance abuse disorders will be harmed in the same way, but will receive an additional benefit for coverage of treatment of their substance abuse disorder. The state of New Mexico will benefit if beneficiaries are unable to meet the new requirements by controlling costs if coverage is terminated, if premiums and copayments are raised, and if beneficiaries are able to meet the requirements by choosing less costly drugs and by appropriately using emergency departments. In addition, the state of New Mexico will also benefit from a healthier population by treating opioid-dependent beneficiaries in their state. Overall, this waiver favors the state of New Mexico and may have some negative implications for Medicaid beneficiaries if they are unaware of or unable to meet new requirements.
Although these demonstration waivers are designed to address very different issues affecting the Medicaid population and can be difficult to compare, I would not recommend either waiver for either issue because their implementation has a vast number of negative impacts on the populations it is designed to help. While states must include requirements to ensure sustainability of Medicaid funding, many of these requirements unfairly disadvantage an already disadvantaged population and do not seem appropriate. Ultimately, these waivers demonstrate a value system that I do not agree with nor support, and I could not recommend either waiver based on the downstream impacts it has on its beneficiaries.

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