Healthcare: Tension between critical needs and economics

by Jason Myhill: Managing Director of Dynaminds (Pty) Ltd and is based in Cape Town, South Africa.

In providing the service of healthcare, there is a constant tension between critical needs and economics. This places healthcare practitioners under immense pressure particularly when economics are low, or tend to decline.

In most countries, a mix of private and public services have developed and are all subject to the same key uncertainties. These key uncertainties are:

  • (A) Medical inflation, which has resulted in many of our population being unable to afford humane medical care.
  • (B) Skills and talent, the lack of which has resulted in a shortage of professional and trained medical personnel.
  • (C) Epidemic/s, which are increasing in reach, severity and frequency. These epidemics now also include lifestyle diseases which impact population health.
  • (D) Consumer behaviour, which compounds the pressure on healthcare facilities.
  • (E) Technology, which is developing rapidly and can be costly if not cleverly managed and maintained.
  • (F) Corruption, which undermines every aspect of healthcare that aims to prosper.
  • (G) Equitable affordability, which infers that in an ideal world no matter what one can pay, everyone should have the same basic healthcare.

Assessing both the impact of each and the predictability of its occurrence, these uncertainties are mapped on the following predictability impact chart.

There are a number of factors that cannot be predicted, these are the unknown unknowns. Where possible, these should be considered and managed. The known unknowns are the very uncertainties that should be planned for and managed. They are the more likely scenarios. It is this insight that makes scenario planning such a fundamental tool for business.

Within South Africa, there are two of the above key uncertainties which are having a deep and lasting effect on healthcare. Number one, the lack of healthcare talent and the inability to attract enough good people into the profession, and two, the ever increasing advancement of lifestyle epidemics, of which HIV/Aids is just one. Taking these two principals, the first largely within the country’s control (talent) and the other to a large extent outside of the country’s control (epidemics), a 2x2 matrix or scenario game board can be created as shown in the picture below.

Most countries would like to see their attraction of skills and talent increase, while the likelihood of epidemics decrease, thus moving in the north easterly direction on the board. Attracting skills and talent requires business acumen and finance. Furthermore, if one considers that most epidemics are in fact lifestyle based and are predominantly health conditions borne of lifestyle choices, one can see that in truth the most pressing epidemics in the country result from choices around alcohol, drugs, smoking and diets. Perhaps then, the cause could finance the effect. The effect of which uses a large portion of the healthcare budget.

Useful resources:
Dynaminds specialises in helping companies manage uncertainty; linking strategic decision making to the business planning cycle and integrating traditional business risk management with strategy. As a result, companies have developed in organisational strategic thinking, increased their turnover, improved their profit margins and better utilised their resources.
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