Healthcare Industry: Structure and Trends - Free Report Sample

Introduction

The healthcare industry is also known as the health economy, and it is comprised of companies that offer to manufacture medical equipment and drug services, clinical services, and also provide medical insurance to patients. The key segments in this type of industry include healthcare financiers, healthcare providers, and life sciences. The paper focuses on the healthcare industry, its market structure, and trends in the industry.

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Sectors

It is an industry that has integration and aggregation of sectors. The types of goods and services provided include treating patients with preventive, curative, palliative, and rehabilitative care (Vitalari, 2016). The goods and services are generalized and commercialized, lending themselves to re-establish and maintain the health of a patient.

The market structure of the healthcare industry is monopolistic. Physicians and healthcare officers use monopolistic power, which is explained in Chamberlin’s model of monopolistic competition (Vitalari, 2016). The structure analyses both perfect and classic monopoly competition in the healthcare industry. The monopolistic market structure indicates how the number of firms in the market can be irrelevant, while competitive results are still reached (Vitalari, 2016).

The characteristics of the health care market that uses the monopolistic model are that the companies are allowed to sell similar products provided that they do not appear identical. Also, it allows firms to exit out or enter the market. It is a model that allows extensive use of technology and knowledge of prices in the healthcare market.

The common trends in this industry include telehealth, consolidating value-based health care, and incorporating AI and machine learning (Vitalari, 2016). There exist a microeconomic relationship in the industry in the event where firms are allowed to enter or exit from the market. Through this, the individuals involved make decisions entailing small resources.

Changes in Growth in Healthcare Industry Over the Years and As Projected

The government has impacted the output and market prices of the healthcare industry. The task of paying for all expenses incurred by healthcare acts as a way of modifying the tax system. In the healthcare industry, the insurer is the government (Gottfried, 2020). In other circumstances, that is, when the involved company is a private firm, the insurer becomes the price paid by health insurance purchasers for their coverage.

Through this process, the insurance market sets the price of covering healthcare needs. However, both federal and state governments regulate the policies to be implemented by the health insurance purchasers. An example is that the government participates in limiting the extent to which the hospitals would charge different prices of services per sex, age, or pre-existing conditions (Gottfried, 2020).

Conclusion

Thus, even if the funding of healthcare for a particular individual occurs between private insurers and a firm or a patient, the government’s public policy is involved. Since health insurance is among the services offered in this industry, its cost is influenced by government regulations and policies (Gottfried, 2020). It results in affecting the output and market prices of the health insurers and purchasers. Since the invention of Medicare and Medicaid by the federal government, they have influenced the regulations and policies implemented in the healthcare industry (Gottfried, 2020). They have led to healthcare cost crises hence affecting the output and market prices since they have resulted in restricting how doctors are supplied in hospitals alongside failing to negotiate the cost of medicine.

Reference

Vitalari, N. P. (2016). Prospects for the future of the US healthcare industry: a speculative analysis. American Journal of Medical Research, 3(2), 7-52.
https://www.ceeol.com/search/article-detail?id=649227.

Gottfried, K. (2020). Conversations Matter: Why Medicare (Unlike Medicaid and the Veterans Health Administration) Cannot Negotiate Prescription Drug Prices. https://repository.wellesley.edu/islandora/object/ir%3A1068/datastream/PDF/view.