A ‘Compelling Event’ for Cost Containment in Healthcare?


Historically healthcare has been most ‘self’ motivated to improve its ‘cost containment’ processes and methods.  This is evident from the significant gap that exists between the technology and process in finance versus healthcare.  Many healthcare organizations (either government or commercial) are not ‘profit’ oriented – take the Blues for example, they are all ‘non-profit’.

As we tend to see in a market economy, profit and competition breeds more effective profit and weeds out the less effective organizations.  Healthcare, as a whole, has not had nearly the same market driver as other industries – there are significant local and federal regulatory restrictions, massive barriers to entry, not to mention, that healthcare (for those that can afford it) is not really optional.  The result is that the healthcare industry has not moved even close to the pace of more competitive industries.

However, with all that said, it does appear that times are changing.

In the Netherlands, for example, following the introduction of a comprehensive reform package in 2006, universal medical coverage has been achieved, and not through a predominantly government-run system.  The Dutch government now requires that all health insurance organizations have a comprehensive cost containment solution for fraud, waste and abuse.  Which would indicate that many Dutch health organizations did not possess those type of solutions.

In the United States, the Affordable Care Act, has not only sought to introduce more competition, but also to encourage and push for better cost control.  Which is interesting, seeing the number of incidents that appear in the press associated to ‘mistakes’ made by Medicare, Medicaid, VA (Veterans Affairs), etc.  But any organization's efforts to improve is a good thing, and it would be wiser to encourage the effort than criticize past missteps.

So this brings us back to the primary question: Everyone realizes that the cost of healthcare is quickly out-pacing our ability to support it.  But is that sufficient motivation for ‘very’ profitable organizations and governments to adjust their practices? Does all of this regulation indicate or create a ‘compelling event’ for cost containment in healthcare?


About Author

Ross Kaplan

Principal Solutions Architect

Ross Kaplan serves as the Principal Global Solutions Architect for Health Care in the SAS Security Intelligence global practice. He supports health care cost containment (Payment Integrity) initiatives across the Health & Life Sciences, State and Local Government, and Federal Government verticals. He has been active across North America, Europe, Middle East, Asia Pacific and South Africa. Providing industry expertise and vision at conferences and directly to customers, Ross has been at SAS for over eight years Ross is a 16 year veteran in the health insurance industry, focusing on analytics in health and condition management, member retention, and provider profiling prior to specializing in health care. He has assisted health plans, federal and State and local government agencies in defining their requirements and providing guidance in their solution advancement. Ross is also trained and experience in Healthcare privacy laws. Prior to SAS, Ross served as a solutions architect at Computer Associates and Siebel Systems, working with the Fortune 1000. He has supported other industries such as Insurance, Banking, and Pharmaceutical. However, his primary focus has always been in health care, receiving training in HIPAA and having direct input in Siebel’s health care product development. Ross has been featured speaker at many industry events focused on health care cost containment and payment integrity, most recently on the topic of social network analysis and link analysis, predictive analytics, and fraud/waste and abuse in the European market. Ross earned a bachelor's degree in Business Administration, with a concentration in Computer Information Systems (CIS) from San Francisco State University and his Master’s Degree in Statistics as well as an MBA with a concentration in Systems Analysis. Sales Training: • Consultative Selling • The Customer Delight Principal • Major Account Sales Strategy

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