Introduction
According to a recent study, it has emerged that approximately half of the mental health care providers in the United States provide their services exclusively on a primary setting. In this case, the health care providers tend to operate in a highly competitive environment. Nonetheless, several studies have affirmed that competitive healthcare markets offer patients high quality services, as well as more options at relatively lower cost. However, identification of a proper course of action can suffice to allow for the realization of strategic marketing success. In fact, over the past few decades, healthcare has become subject to intense competition than virtually any other marketplace in the world (Maeda & LoSasso, 2011).
This paper will address key characteristics of the users of the services offered by Acadia Healthcare Company, Inc., analyze the provider’s competitive environment, as well as the most effective tools of the marketing mix available to this health care provider. It will also determine the best possible pricing strategy for at least one of the services offered by Acadia Healthcare.
Characteristics of the users of Acadia Healthcare services
Acadia Healthcare is an aggressive growth firm that’s specialized in psychiatric and chemical dependency services. It offers its services to patients with behavioral problems in its psychiatric facilities, substance abuse facilities, group homes, and residential treatment centers in the United States. Consumers of the ACHC‘s health services include people residing in rural areas as well as those in the urban setting (Acadia Health Care, 2013).
However, it’s important to point out the fact that the patients served by this health care provider possess different chara...
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...ricing of psychiatric and addictive disease intensive outpatient services can be achieved using cost plus pricing strategy. With this strategy, this healthcare provider adds a margin to the expected cost of offering such services before charging a client a certain price. This implies that Acadia will only make profit by imposing a price that’s fair to the consumer, and reduction of costs would be the only strategy for the company to increase its profit margin (Hodges, 1954).
To keep up with the increasing competition in the market place, comparative pricing strategy can also be a viable strategy for Acadia. This mainly involves pricing products or services based on their perceived value in the market. However, this strategy can be quite demanding since Acadia has to know the prices of its competitors in order to ensure that its pricing does not look like collusion.
This group is more focused on satisfaction, access and quality of care. Providers, or practitioners, are also key stakeholders within an organization. The term provider can encompasses not only physicians and surgeons, but also nurses, physical and occupational therapists, technicians, and other members of a clinical staff. Providers fall into two categories, primary, which includes hospitals and health departments and secondary, which includes educational institutions and pharmaceutical companies. Providers are focused on the best treatments for patients and are involved in delivering health services and products. The final element of the MCQ model is the employer who by far is the largest paying and purchasing stakeholder of an organization. The employers focus is primarily on their return on investment within an organization. Cost and quality is a focus for employers when choosing health benefits but are mindful that access is just as important. Within the Patient Healthcare model, MCQ explains the interactions between the four elements of employer, patient, provider and payer while the Iron Triangle focuses on the factors of cost, quality, and access. The Patient Healthcare model charges healthcare leaders with the task of balancing satisfaction with the stakeholder (employer, patient, provider, and payer) in relation to cost, quality and access. This may be very difficult since stakeholders may have competing priorities. Changes and variations made in how healthcare organizations operate may have profound effects on how stakeholders perceive the quality, access and cost. For instance, a patient may consider cost to be a top priority when seeking healthcare and at the same time the healthcare organization may consider raising costs and therefore devaluing access and quality. Patients who begin to incur high out-of-pocket costs may begin to perceive a financial
To guarantee that its members receive appropriate, high level quality care in a cost-effective manner, each managed care organization (MCO) tailors its networks according to the characteristics of the providers, consumers, and competitors in a specific market. Other considerations for creating the network are the managed care organization's own goals for quality, accessibility, cost savings, and member satisfaction. Strategic planning for networks is a continuing process. In addition to an initial evaluation of its markets and goals, the managed care organization must periodically reevaluate its target markets and objectives. After reviewing the markets, then the organization must modify its network strategies accordingly to remain competitive in the rapidly changing healthcare industry. Coventry Health Care, Inc and its affiliated companies recognize the importance of developing and managing an adequate network of qualified providers to serve the need of customers and enrolled members (Coventry Health Care Intranet, Creasy and Spath, http://cvtynet/ ). "A central goal of managed care is containing the costs of delivering care, but the wide variety of organizations typically lumped together under the umbrella of managed care pursue this goal using combination of numerous strategies that vary from market to market and from organization to organization" (Baker , 2000, p.2).
Belluck’s New York Times article describes a study that ordered mentally ill patients to receive treatment instead of being hospitalized. The study found that the patients were less likely to be placed in psychiatric hospitals or arrested, and outpatient treatment and medication refills increased. This also proved economical, because the mental health system and Medicaid costs were reduced by at least fifty percent. This program doesn’t only apply to the patient to accept treatment, it also requires the mental health system to provide it, making the program more effective
Davidson, Stephen M. Still Broken: Understanding the U.S. Health Care System. Stanford, CA: Stanford Business, 2010. Print.
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