For the longest time, I have been arguing that there are enormous business opportunities in the healthcare sector - more specifically, in providing healthcare services to the uninsured. During last couple of days, two more interesting pieces of data were made available that make the argument even stronger.
In a recent speech Massachusetts Governor Mitt Romney confirmed what Families USA is saying by pointing out that the costs of the uninsured are eventually shifted to businesses and insured Americans - or to the governments, where those same businesses and individuals pay for uninsured care through their taxes. He said, "There is, in fact, no such thing as truly free care - free care is just an additional burden on those who are already paying their own way." In other words, the current system is broken can not survive power of market forces in a capitalist economy like ours. The current system "is costly, inefficient and ineffective. Put simply, a bad deal for everyone," Romney said.
- Health insurance premiums will cost families and employers an extra $900 on average during 2005 to cover the costs of caring for the uninsured, according to a report released by Families USA, a non-profit, non-partisan organization. With the added cost, the yearly premiums for a family with coverage through an employer will average $11,000 in 2005. By 2010, the additional costs for the uninsured will be $1,500, and total premiums will hit $17,000. In 11 states, the costs of the uninsured will exceed $2,000 per family.
- General Motors is reporting that its huge healthcare commitments are primarily responsible for its problems ($1,500 comes out from the profit of each car to pay for health insurance). GM also announced massive layoffs and plant shutdowns.
In a recent speech Massachusetts Governor Mitt Romney confirmed what Families USA is saying by pointing out that the costs of the uninsured are eventually shifted to businesses and insured Americans - or to the governments, where those same businesses and individuals pay for uninsured care through their taxes. He said, "There is, in fact, no such thing as truly free care - free care is just an additional burden on those who are already paying their own way." In other words, the current system is broken can not survive power of market forces in a capitalist economy like ours. The current system "is costly, inefficient and ineffective. Put simply, a bad deal for everyone," Romney said.
- Governor Mitt Romney has put together an excellent program to reform Massachusetts' healthcare system to allow all citizens to access affordable healthcare, without raising taxes. How is he able to do it? He is working with the insurers to provide a product that covers preventative care, outpatient, inpatient, pharmacy, ambulatory and mental health services at a mere $200 a month. It is not just a catastrophic-only or any other type of "skinny" health insurance. The prospects of this being approved are extremely high and that only means that additional revenue for anyone in the value chain who chooses to participate in it.
- A company called TelaDoc has implemented the idea that I have mentioned previously. While it is not conventional health insurance per se nor is it comparable to a clinic visit, but the service offers cost-effective, around-the-clock telephone access to physicians at just $35 per call. The service costs just $4 a month. So for all those millions of Americans who get suffer because they can't even speak to a doctor, this is an excellent service as it allows them to have even prescription drugs.
- Research the healthcare sector, particularly the value chain. A paradigm shift is about to happen and that means a lot of new opportunities to create value.
- Some the existing business models in the healthcare and pharma value chain are about to become obsolete. This is an excellent time to research the trends and competitive dynamics to assess how you will be affected and take action.
- If the Massachusetts initiative succeeds, it will generate a tidal wave in the insurance industry. That means both opportunities and threats. Study how it will impact your business.
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Keywords: Healthcare - Insurance - Business model
Links: Massachusetts Government - Families USA - TelaDoc