HCA Section I

HCA 7

HCA

SectionI

Thehealthcare industry has been faced by different challenges ashospitals attempt to compete for profitability. In their attempt tocompete for profitability, hospitals have been involved in offeringhigh-quality care for profitability reasons. This report will focuson the HCA as one of the hospitals that has been involved inproviding high-quality care and using false information in order toincrease its revenues at the expense of its patients. This has led topatients lacking confidence with the hospital. The key terms thatwould be used in the report include poorpublic image, fraud, merger, and profitability among others.

LITERATUREREVIEW

Researchon Poor Public Image

Morgan&amp Morgan (2012, August 24th).HCAHelping Profits, Not Patients.Retrieved fromhttp://www.forthepeople.com/blog/hca-helping-profits-not-patients/

Thisarticle has been authored by Morgan &amp Morgan. According to thearticle, the financial success of Hospital Corporation of America(HCA) has been unlikely over the past six years due to HCA adopting aculture, whereby it prioritizes profits over patients. Since HCAbecame an industry model that could be emulated due to its unreducedprofitability over half a decade, many have raised a suspicion overthe company’s peculiar success especially because of the economicconditions that the company prospered.

Thearticle further points out that for-profit status has been argued asthe chief source of the company’s misgivings. The measures of HCAof mitigating costs and increasing revenue have been designedpurposely with aim of appeasing shareholders and investors atpatients’ expense. In addition, the article claims that HCA hasbeen involved in unorthodox resource saving practices, where it isengaged in changing the billing code for emergency room patients soas to reap higher levels of Medicare. Moreover, according to thearticle, HCA has been alleged to increase its revenues throughmisleading patients.

Jonathan,G.M. (2003). A Strategic Analysis of the Hospital Industry and HCAIncorporated. Journalof Applied Management and Entrepreneurship,Vol. 8 (2).

Theauthor of this article is Jonathan McCosh. The author argues that asa result of the government being involved in extensive researchfollowing the practices of HCA, the corporation has now changed itsstrategic direction and its senior management. According to thearticle, analysis of HCA using such models like the Remote AnalysisModel, Porter’s Five Forces Model, and McKinsey Model, indicatesthat the economies of scale of HCA have made the corporation tocenter on demographically favorable markets. Furthermore, accordingto the article, the corporation’s public image is the corporation’schief weakness.

Researchon Fraud

Martinez,B. (2002). HCA’s Medicare-Fraud Problems May Not Be in CompleteRemission. TheWall Street Journal.Retrieved from http://www.wsj.com/articles/SB1014762640694219920

Thisarticle has been authored by Barbara Martinez. According to thearticle, HCA was involved in a fraud case, but the fraud case is notyet over because there are signs indicating that the fraud case mayemerge afresh. The author claims that HCA had a Medicare-fraud miserythat cost it approximately $800 million in the year 2000. Accordingto the article, analysts claim that the corporation may be on thehook again, where it would cost approximately $200 to $400 million.

Hudson,J. (2012). Here’s Why You Need to Know About HCA. TheWire.Retrieved fromhttp://www.thewire.com/business/2012/08/heres-why-you-need-know-about-hca/55460/

Accordingto this article, for several years, the practices of HCA haveattracted the scrutiny of the government into the business. Followingan attractive growth in the 70s and 80s, the corporation got intotrouble in the 90s because of its practices of going beyond the legallimits of earning profits. The article claims that the corporationwas involved in practices like fraudulently exaggerating theirexpenses in order to augment their compensation from Medicare, aswell as regularly carrying out unnecessary blood tests.

SectionII: Comparative Company Analysis

Mahar,M. (2013). Medicare Fraud and For-Profit Hospitals – A Story ThatNever Ends.Health Beat.Retrieved fromhttp://www.healthbeatblog.com/2013/06/medicare-fraud-and-for-profit-hospitals-a-story-that-never-ends/

Thisarticle has been written by Maggie Mahar. The article gives acomparison of Medicare fraud that was evidenced by two healthorganizations Health Management Associates (HMA) and HospitalCorporation of America (HCA). According to the article, both HCA andHMA have been involved in defrauding Medicare as well as harmingpatients for several years. These two hospitals have been involved inpaying fines after they are investigated and found to have engaged infraudulent practices. The article points out that just like HMA, HCAwas involved in deceiving patients and hospitalizing them andconvincing them to have cardiac surgery even without having cardiachospitals. According to the author of this article, the hospitalswere involved in putting patients at risk of contracting preventablemedical errors without any justifiable reason. In addition, both HMAand HCA were engaged in obtaining more Medicare resources since theywere driven by the profitability motive instead of putting patientcare as the priority. It is due to the involvement of these twohospitals in medical frauds and having profitability motive insteadof putting patient care as the priority that made the hospitals havea poor public image. As a result of this, there was a need to keep onchanging the names of the hospitals.

SolutionOpted by Health Management Associates (HMA)

Asa result of the increased competition in the healthcare industry, itis critical for a health facility to argue the best way forward toensure that it continues to remain competitive in the industry aswell as maintain its profitability.

MeritHealth (2015). Community Health Systems to Acquire Health ManagementAssociates. Retrieved fromhttp://www.merithealthriveroaks.com/about/news/community-health-systems-acquire-health-management-associates

Accordingto this article, Community Health Systems (CHS) and Health ManagementAssociates came to an agreement of forming a merger. According to theamalgamation, CHS was going to manage about 206 hospitals having asum of about 31,000. The article posits that the amalgamation amidthe two health organizations would offer a premeditated opening ofdeveloping a vast organization having a various collection ofhospitals which is focused on accomplishing the merits of health carereorganization as well as addressing the changing aspects of theindustry. Moreover, the article provides that the merger would aidthe hospitals in providing excellent quality care to patients.

SectionIII

Giventhat HCA is facing a similar problem as HMA, where it is facingdeclining profitability emanating from the fraud and poor publicimage, the organization can follow the solution that HMA followedthat is, the hospital should consider seeking a merger with anotherhealth care provider. As a result of the merger, the hospital will becapable of giving better and quality services to patients, whichwould overcome the fraud situation it has experienced in its history.Besides, enhanced quality care emanating from the merger would alsolead to enhanced profitability due to improved public image.

References

Hudson,J. (2012). Here’s Why You Need to Know About HCA. TheWire.Retrieved fromhttp://www.thewire.com/business/2012/08/heres-why-you-need-know-about-hca/55460/

Jonathan,G.M. (2003). A Strategic Analysis of the Hospital Industry and HCAIncorporated. Journalof Applied Management and Entrepreneurship,Vol. 8 (2).

Mahar,M. (2013). Medicare Fraud and For-Profit Hospitals – A Story ThatNever Ends. HealthBeat.Retrieved fromhttp://www.healthbeatblog.com/2013/06/medicare-fraud-and-for-profit-hospitals-a-story-that-never-ends/

Martinez,B. (2002). HCA’s Medicare-Fraud Problems May Not Be in CompleteRemission. TheWall Street Journal.Retrieved from http://www.wsj.com/articles/SB1014762640694219920

MeritHealth (2015). CommunityHealth Systems to Acquire Health Management Associates.Retrieved fromhttp://www.merithealthriveroaks.com/about/news/community-health-systems-acquire-health-management-associates

Morgan&amp Morgan (2012, August 24th).HCAHelping Profits, Not Patients.Retrieved fromhttp://www.forthepeople.com/blog/hca-helping-profits-not-patients/