Reduce Price to Improve Revenues and Margins

CHOICE 1 OBJECTIVE: ATTRACT CUSTOMERS

CHOICE 2 SEGMENTS: TARGETED COMPETITOR SEGMENT / STANDARD LEADER PRICE AGAINST ESTABLISHED STANDARD LEADER / AGAINST A TOP TIER STANDARD LEADER

CHOICE 3 COMPONENT: SET A PRICE CAP

No. SIC Year Notes
1 8062 2008 Managed care, that much maligned symbol of greedy insurers and lousy health care in the 1980's and '90s is coming back. Blue Cross Blue Shield of Massachusetts, that state's dominant insurer, and financially struggling Caritas Christi Health Care, its second-largest hospital network, want to switch from a system that charges patients for every medical service to managed-care-like flat fee per patient. The yearly fee would be adjusted for age and illness. Caritas says this will allow it to offer cost-efficient care. Such an approach will distinguish its six small medical centers from the many large teaching hospitals in Boston that levy fees for every visit, test, and medical procedure. For its part, Blue Cross Blue Shield hopes to halve growth in medical spending within a year by hospitals and doctors who accept flat-fee reimbursements.

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