Effects of the Affordable Care Act on Hospital Business Models

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The healthcare industry is undergoing several changes that are brought about not only by modern technology and shift of patients towards specialized providers but overall changes in the US healthcare system, such as, implementation of new legislation. Therefore, todays healthcare administrators are faced with new and unprecedented barriers (Figueroa, Harrison, Chauhan & Meyer, 2019). However, this paper will focus on the issues presented by the implementation of the new legislation. The Affordable Care Act was enacted in 2010, and its objective was to improve the quality of care, lower costs of care, expand healthcare coverage, and hold insurance companies accountable (HealthCare.gov., 2020). As a result, the number of individuals seeking care has increased, also known as patient consumerism; thus, making it challenging to deliver high-quality care. Furthermore, considering that hospitals are faced with budgetary constraints, this can result in poor technical and human resource allocation that creates a disconnect between demand and supply.

From the before-mentioned points, it can be seen that the primary stakeholder affected by this issue comprise the public, hospitals, the government, and insurance agencies. These increased healthcare demands and cost constraints have led to hospitals adopting new business models (Figueroa et al., 2019). However, this is influenced by both distinct internal and external factors. Therefore, health administrators must keep abreast of the constantly evolving business models of care delivery and evaluate their impact. Although the ACA was enacted approximately ten years ago, some of the after-effects are faced now. For instance, individuals have become more empowered to select providers based on their expectations and needs. As a result, with the guidance of healthcare administrators, providers must improve patient satisfaction scores to attract and retain patients, and take advantage of quality-based incentive payments (Collier & Basham, 2015). This will lead to the hospitals generating more profit.

References

Collier, M., & Basham, L. M. (2015). Patient engagement: Happy patient, healthy margins. Web.

Figueroa, C. A., Harrison, R., Chauhan, A., & Meyer, L. (2019). Priorities and challenges for health leadership and workforce management globally: A rapid review. BMC Health Services Research, 19(239), 2-11.

HealthCare.gov. (2020). Affordable Care Act (ACA). Web.

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