1. HEALTHCARE & MANAGEMENT: Challenges & Opportunities Chung-Fu Lan National Yang-Ming University October 16, 2003, Kaohsiung

2. Challenges

3. The Health of the Nation u The improvement in the citizen’s health (as shown in most of health indicators). u The universal health insurance program has essentially achieved equitable access for all & improved cost efficiency. u But the performance between quality of healthcare & quality of life, personal medical care & public health care, healthcare delivery & finance, national health account & household economic burden, as well as the response to the special need of aging & vulnerable populations, to the new & shifting burden of disease, & to the progress of technology & information advancement are still major concerns.

4. Drastic Changes in Taiwan’s Healthcare Environment u Dominance of the NHI on healthcare expenditures, resources development & their ecologies. u Massive expansions of large medical centers/chains (hospital beds) & health-related schools, & skewing of some small & medium-size hospitals, clinics & medical specialties. u Demands for health professionals to meet the need of the market-driven healthcare system & pressures in clinical practices to catch up with the progress of new technology & information development. u Public expectation on higher quality services at lower contribution.

5. Reasons for Changes in Healthcare Environment 1. Changes in medicine itself 2. Ever-expanding role of government: Through financing and regulation 3. Involvement of financial & industrial capital: The business of medicine 4. More knowledge & questioning public: Challenging traditional medicine interests

6. Health Policy Challenges Encountered by the Decision Makers u Dealing with scarcity u Funding systems equitably & sustainably u Allocating resources effectively u Delivering care efficiently u Implementing change

7. Scenarios for Healthcare Industry u SCENARIOS 1. Business as “usual” 2. Hard times/ Government dominance 3. Buyer’s market/ Market competition 4. Strategic thinking & planning/ Focused or specialized/ Innovation u COMPONENTS Society & economy, National health (insurance) policy, Population structures & demands, Health system needs, Health outcomes & % of GNP

8. Structural Shifts in Healthcare u New incentives & disincentives u The transformed system with hybrid healthcare u An increase in consumer sovereignty u Growth of new products & market segmentation u Growth of managed care u Salaried physicians up, autonomy down u Hospital admissions down but shift to ambulatory & community environment u Increase in intensity of inpatient care u Shift of healthcare manpower & resources into more profitable services u Financial pressure means political pressure

9. Opportunities

10. Demographics & Burden of Disease u Growing older & living longer u Increasing diversity u Widening household income gap u Shifting burden of disease – lifestyle behaviors, mental illness, & chronic diseases u Increasing healthcare costs u Increasing tiering of health insurance

11. Healthcare Delivery System u Reassessment of healthcare workforce’s supply & demand u Evolution of healthcare delivery organization (vertical, horizontal & virtual integration, IDS or networks, center of excellence,…) u New activity of medical management (from managed care to managing care)

12. Medical Technologies on Care u Genetic mapping & testing u Rational drug design (the use of computer to design drugs that target a particular molecular receptor or enzyme, then turning them on or off) u Minimally invasive surgery u Advances in imaging u Gene therapy u Vaccines u Artificial blood u Xenotransplantation (the transplantation of cells, tissues & whole organs from one species to another) u Stem cell technologies

13. Information Technologies in Healthcare u Basic business process-management systems (go electronic & automation) u Clinical information interfaces (electronic medical records, EMR) u Data analysis u Telehealth (combining case management & patient information systems) & remote monitoring

14. Reconciling Public Health & Personal Medicine u Expanded perspective on health u Children’s health u Women’s health u Health & healthcare of the seniors u Disease management u Disability, chronic care & quality of life u Health behaviors

15. Healthcare Paradigm Shifts from Biomedical to Expanded View u Rigid adherence to the biomedical model u Attention solely to acute episodic illness u Focus on individuals u Cure as uncompromised goal u Focus on disease u Expansion to incorporate a multifactorial view of health u Chronic illness management u Focus on communities & other defined populations u Adjustment & adaptation to disease for which there is no cure u Focus on disease person & the disease

16. Forecasting Future Scenarios in Healthcare u Population-based healthcare u Horizontally & vertically integrated healthcare u Organized & managed healthcare u Evidence-based healthcare & reimbursement u Genomic/molecular medicine u e-healthcare (B2B, B2C & C2B, C2C)

17. Basic Strategies for Healthcare Reform in State Controlled System u Privatization u Pre-funding u Diversification/ Selectivity u Raising incentives or benefits/ Lowering entry criteria u Competition/ Integration u Teamwork/ Alliance u Private Finance Initiative/ Public Format Initiative; PFI

18. Possible Options for Taiwan’s Healthcare System u Both demand- & supply-side cost controls u Enforcing quality management u Decreasing reimbursement by government & insurers u Capping healthcare budgets u Encouraging managed competition, declining use of inpatient care, resulting in closures & mergers u More outpatient care & diversification u Growth of alternative institutions & service models

19. u Industry consolidation u Concentration of services in large healthcare chains u Financial security & competition u Increasing amount of extra-billing u Using more intermediate manpower u Non-price competition between hospitals u Disintegration of bargaining power u More experiments, more reinventions

20. The Challenge for Taiwan’s Healthcare System u Rethinking of: –values in health & medicine –philosophy & objectives of medical & allied health professional education –rights & responsibility for clinical decision- makers –duty to the patient & to the society

21. u Rebuilding of: –morality in medicine & healthcare –healthcare delivery structure –healthcare financing mechanism –trust among the consumer, the provider & the insurer in healthcare

22. u Rebalancing at: –public expectations & limited resources –scientific advancement & clinical excellence –quality & cost in healthcare –health education & information development –clinical & managerial decision-making –medical ethics & new technological progress

23. Final Notes u Improving the nation’s health by planning a National Health Plan (NHP), rather than just the NHI, to reorient the goal & the content of health and healthcare services. u Preparing to meet the shifting & emerging paradigms from the traditional biomedical model view to an expanded multifactorial view of health. u Meeting healthcare and societal needs in accordance with socioeconomic resources development & affordability, making it happen with strategic thinking, target setting & prioritizing. u Keeping paths with scientific advancement & value changes. u Maintaining flexibility with diversity & changes.

24. Many Thanks !!