Economies of Scale

Q.1 Write reply/ response for this article. (Jose)Professor and classmates, as more and more countries adopt market-based approaches for healthcare delivery, executive attention will continue to shift from the merits of competition to strategies for staying alive and prospering. The constant pressure for improved clinical, operational and financial performance leave little time for trial and error. These are some examples that healthcare organizations are responding to the healthcare marketplace. One way is that you are stating to see more and more businesses grow and merge by entering into a joint venture. By doing so they have the ability to leverage economies of scale, strengthened bargaining position with cost payers and more services in managed care programs through verticalization along the supply chain. Another way is to establish and develop more outpatient networks that can reach out to more people and have the organization achieve significant outcomes in less capital intensive ways than by just building hospitals. Another way would be making sure the organization invests in modern IT, staff training, high performance equipment, modern premises and even contemporary room amenities is the price for staying profitable in a highly competitive market. Healthcare institutions are using smart finance to improve planning, acquire state of the art technology and manage cost-per-outcome in order to offer high-quality care and service to patients, which in turn enhances the organization’s reputation, attracts more patients and staff, deploys clinical services more efficiently and effectively, adapts seamlessly to market changes and ensures regulatory compliance. more information on Economies of Scale check on:

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