A reputable hospital has high quality ratings from patient satisfaction surveys but is still losing market share. For many years, health care organizations

Expert Answer and Explanation

Introduction

The primary essence of any hospital facility is to provide quality medical services for their patients. Additionally, patients tend to be concerned with three aspects of care delivery within the hospitals, notably, quality, access and cost of healthcare services (Pitkin Derose, Bahney, Lurie & Escarce, 2009).

Keeping the costs low, improving access to the medical services and making quality superior would tend to guarantee higher access to medical services that are offered by a facility. Patient satisfaction surveys are often methodological and scientific tools that are used by hospitals to determine the extent to which patients are satisfied with the set of services that they offer to them.

The surveys also provide the facility with information on the aspects of care delivery that they will need to improve on. Presently, there is an emerging phenomenon that establishes that high customer satisfaction in hospitals does not necessarily lead to higher levels of revenue or profitability in hospitals. This paper discusses the case of a reputable hospital that has high-quality ratings from patient satisfaction surveys but is still losing its market share.

Inconsistency between customer satisfaction scores and profitability

The customer satisfaction scores are often premised on the quality of medical services that the facility offers to patients. Patients are willing to pay more for quality services and have access to qualified and highly trained medical personnel. The brand of any given medical facility often tends to rest with the quality of services that they offer to their clients.

Economically, the accomplishment of profitability would often be realized when the liabilities of an entity is lower than the revenue that they earn. However, for the reputable hospital, they often experience a higher wage bill, owing to the quality of expertise that the employee and higher operational costs. Such tend to cut down on the total revenue that they earn from their set of operations.

The lack of lean management within the reputable hospitals would also lead to the facilities experiencing a higher volume of wastes which then eats on the profitability that the company needed to realize(Graban, 2016).  Additionally, the hospital facilities that tend to emphasize their brand are often wished away by their concept of customer loyalty. While the few patients that the facility serves to grant higher ratings for the facility, the facility serves few people and earns low revenue that makes it difficult for them to break even.

Statistical Procedures

According to Schmocker, Stafford and Winslow (2019), logistic regression is an analytical procedure that can be utilized in the examination of the relationship between the binary variable and independent variables within the healthcare setting. The concept can further be used in the explanation of the relationship between an effect and treatment.

Medical institutions would often utilize such data in the redesigning of their health programs and determination of the level of care that would lead to better patient outcomes. The better patients outcomes would often lead to the patients issuing higher ratings to the facility, thus, resulting in an improvement in the scores that the patients would grant to the facility.

In the field of medicine, regression can be used in the explanation of the relationship between a type of treatment that is issued by the facility and the reduction in the symptoms that the patients are likely to experience.

Price vs. quality of services as well as the impact of insurance or managed care contracts on a hospital’s market share

The provision of higher quality medical services at relatively lower costs would conventionally lead to an improvement in the market share that is held by a given business entity. While higher quality is the primary factor that patients would use, costs are deterrent to many patients. Some patients would also sacrifice either their earnings or investment to access medical services.

Therefore, the facilities that charge premium prices for their facilities would tend to attract fewer people, thus, low market share. Insurance and managed care contracts also serve to improve the market share that is held by a given medical facility. In the United States, healthcare is majorly privatized with many patients either have a subscription to private medical insurance schemes, Medicare or Medicaid.

The provision of access to quality services for patients with different insurance schemes would lead to a higher proportion of the patients who would prefer utilizing the services of such a facility. The managed care contracts also tend to enhance access to restricted medical services are costs that are slightly discounted (Dru