Quintiles Transnational Competition
Now Viewing Quintiles Transnational's competition in: Healthcare Sector (primary)
Call Preparation Questions
Customers, Marketing, Pricing, Competition
Who are the organization's customers? - Typical customers are individuals requiring urgent medical care, routine check-ups, and long- or short-term assistance ranging from nursing home care, day care, and social services.
How does the organization market its services? - Doctors typically use traditional approaches such as Yellow Pages' ads, word-of-mouth, and referrals. Hospitals market themselves through medical presentations, brochures, magazine and newspaper ads, targeted press releases, informational websites, and TV ads.
How active is the organization's Internet presence? - A growing number of physicians have websites and even personal blogs, although doctors must avoid violating patient rights and privacy laws when writing about specific cases or incidences.
What are the organization's typical prices? - For hospitals, the average revenue per admission is close to $10,000. The average daily cost for a hospital stay is around $1,500. Average revenue per outpatient visit is around $500.
How does the organization respond to Medicare's pricing policies? - Medicare sets limits on reimbursable charges. Medicare policies allow a physician to charge a patient only around $35 for a $75 15-minute visit. To offset this $40 "loss," doctors often limit the number of Medicare patients they accept, shorten patient time, or raise prices on private payers.
What sorts of contractual arrangements does the organization have? - Doctors, hospitals, and insurers generally have multiyear contracts with each other. Managed care plans, like HMOs, because of the large number of patients they represent, often have the upper hand in negotiating contracts with healthcare providers.
How large a geographical market area does the organization serve? - Most healthcare providers treat patients within a 100-mile radius, although well-regarded hospitals and physicians may care for patients from around the world.
Has the population in this market area been growing or shrinking? - Over the last decade, population flow has been out of the Northeast and to the South and West.
Competitive Landscape
Demand for healthcare services is driven by demographics and advances in medical care and technology. The profitability of individual companies depends on efficient operations and, in the case of many nonprofit healthcare providers, obtaining grants and federal funds. Large companies have advantages in accessing the latest medical research, buying supplies, offering a wide range of services, and negotiating contracts with health insurers. Small institutions can compete successfully by serving a limited geographical area, offering specialized services, or building a local reputation for quality care. Healthcare is labor-intensive: annual revenue per employee is $80,000. Revenue per employee is nearly $100,000 for ambulatory services and hospitals, and only around $45,000 for nursing homes, residential care facilities, and social assistance providers.
Business Challenges
CRITICAL ISSUES
Containing Rising Costs - Healthcare officials expect the cost of medical care to continue to grow between 7 and 10 percent annually through 2010. Physician care, hospital services, and prescription drugs are all expected to continue their unprecedented rise in costs. The average cost per stay at a community hospital was $1,800 in 1980; today, the average cost is nearly $10,000.
Dependence on Federal Regulation - Government programs account for 45 percent of the nation's healthcare spending, up from 35 percent in the 1970s. This figure may rise if the US moves toward federally funded healthcare programs. With an annual budget of $400 billion, Medicare has an outsized influence on medical practices through its detailed reimbursement schedules. These schedules set an industry standard that insurers copy - standards that, according to many physicians and hospitals, fail to cover the rising cost of medical care. New treatments, even if already approved by the FDA and the medical community, have a limited market if not approved for Medicare reimbursement.
Industries Where Quintiles Transnational Competes
- Pharmaceuticals
- Biotechnology
- Biotechnology Research Services(primary)
- Biotechnology
- Business Services
- Health Care
- Health Care Services
