US healthcare system overview

U.S. Healthcare

The final legislation should have incorporated provisions to boost the IVD industry. On its entirety, the Patient Protection and Affordable Care Act must have benefited the IVD industry. This would have increased sales in a span of five years that it is otherwise seen in the absence of the law. Most significant IVD sales drivers will result from the legislation as an expansion of in the number of insured citizens and new coverage of prevention and wellness programs. If various key provisions are included in the PPACA, coupled with the population demographics, IVD product sales will be stimulated. This industry will die or live based on the number of the test procedures and hence increase in the number of persons with healthcare coverage will be appropriate for IVD. The Patient Protection and Affordable Care Act is a sophisticated legislature, virtually affecting all aspects of healthcare and the majority of its provisions have begun to take effect. The goal of the Act must be to increase access to healthcare coverage for legal residents and U.S. citizens by asking people to have coverage and employers to support or offer coverage (Parks, 2012). If PPACA is expanded to address issues in IVD, it will increase the number of insured U.S. individuals, product innovation, and new coverage of preventive and wellness programs. The Act should eliminate legislation, likely to generate challenges like the medical device excise tax. The legislation has not addressed a number of issues. They include public confusion about the PPACA, state expansion of Medicaid, Medicare payment rates reform and future of the medical device tax.

Q2

Confronted with a myriad of reforms in the global market place, companies in the pharma industry know that they need to change and adopt a new commercial model. Companies must adopt the best route to a new commercial model. This process includes consideration of possible pitfalls to consider. Soon, the pharmaceutical market will be commoditized globally in areas where pharmaceutical firms have heavily invested. A shift in stakeholder influence and regulations that are more stringent is likely to contribute to further misalignments if pharma companies do not revise their commercial models. Although companies recognize the upcoming patient cliff and new they ought to be prepared, they lacked a common approach to a new commercial model (Ross & Ross, 2013).

Currently, the major industry challenges and pressures are well understood. Some customers have the implementation and development of a new commercial model on their agenda. Organizations have reported that they recognized the need for change, but they have not yet started the evolution to a new commercial model. On the contrary, a number of organizations are not even considering change. The greatest challenge in considering the change are maintaining business as usual and managing change implementation and change within the organization. While change is fundamentally on the records for most companies, it tends to be difficult to know where to start. Pharmaceutical companies are prisoners of their own success. Although the business setting for these firms has drastically changed in the recent years, the pharma commercial model, which served the industry in the previous decades, has failed to keep pace. Pharma executives are aware, and this is hardly news to them, a majority of whom doubts the viability of investments in selling capability, science and plants, which previously yielded incremental changes and restored historic returns. Leaders in the drug industry believe that massive changes to the blockbuster model are likely to rekindle old sparks and restore value. However, this strategy will only delay the inevitable. Drawing from current investment levels, forecasts of commercial performance and success rates, the blockbuster model can only be expected to deliver approximately 10% return on investment. This is substantially lower than the industry's risk cost of capital (Schweitzer, 2007).

Q3

Over the last years, the U.S. has witnessed skyrocketing healthcare costs. Insurance premiums in healthcare by an average of a double-digit percentage over the past five years. The increased rate is almost three times the rate of inflation. A new agreement in the healthcare policy informing and engaging consumers on their key role of enhancing the quality of care from the U.S. health system must exist. It is expected that when consumers are equipped with the appropriate information, they are likely to demand high quality services from providers, become active participants of their own health and choose treatment options wisely (Tate, 2012). However, the choices they make tend to navigate the health system in a dizzying manner, from selecting healthcare plans to pros and con of alternative treatment options. Today, the choices have become complex coupled with the sophistication of the healthcare system itself. The policy community is under pressure of ensuring that consumers have the information, and necessary tools to play the active role.

Contrary to other consumer healthcare decisions, the choice of a health plan must be made before becoming ill. The main factors that must be involved in this decision include the financial consideration like copayments and premium and the provider panel. Contrary, quality of care seems to be a salient variable in the decision of provider because consumers tend to be shielded from price variations across providers by insurance. Studies indicate that satisfaction will also play a vital role in the choice of providers. However, making healthy choices in healthcare is likely to be affected by external constraints. Employers are likely to manipulate the premiums and limit the number of choices. Consumers making choices regarding treatments are limited by information access. This makes them unable to make treatment choices alone, as they have to depend on medical expertise of providers about their options and potential outcome.

Q4

There is no guarantee that Obama's health insurance exchanges will be launched smoothly and on time. Obama's administration had spent almost $400 million to set up infrastructure of an expansive system incorporating every state, major federal agencies, millions of citizens and hundreds of insurance firms, among many individuals seeking coverage for the first time. While progress in determining the regulatory framework for this new law has been felt, it is not ready for prime time, and most U.S. citizens and insurance companies are likely to suffer the consequences. Middle class individuals lacking access to employer-based treatment will purchase private insurance, mostly with new tax credits to aid pay premiums (Tate, 2012). People comprising the low-income class are expected to be steered to public plans like Medicaid in areas adopting the expansions offered under the new law. More citizens and legal residents are expected to sign up new coverage through the exchanges while Medicaid rolls will grow significantly. This progress is projected to grow steadily as Americans will be more familiar with the law and its merits.