Australia's Medicare System: Challenges and Opportunities

Introduction

Australia possesses an institutionalized Medicare system that is constructed by a global access standard. The system designates all Australian citizens to subsidize medical care from professionals from the health care centers, and acquire medical care for free in all publicly funded health institutions. Despite being ranked among the best efficient globally, Macri (2016) identifies that the Australian Medicare is still facing major healthcare challenges and issues in promoting patient health care due to low infant mortality rates and high life expectancy like other industrialized states. Through privatization of healthcare system the government projected addressing the following health issues; Health issues in Australia have offered a business opportunity of introducing a home, polyclinic and mobile clinic healthcare business plan, projecting to meet the needs of health issues affecting Australian across the country.

Social Issues- Health

Australia is a developed country but it is undergoing serious health issues and challenges such as health policy challenges that are require mitigation over the next four to five years. In specific, the country is facing increased cost of medical technology, increasing ageing population, inequality and equity issues in health, expeditious urbanization health problems, public and private funding of medical care and demographic changes. These issues confront the vital and improving health care that requires privatization of the health care sector to confronts. These issues include;

Technology Cost

While technology and technological improvement have fostered the lives of patients in terms of management and diagnostics of adverse illnesses in the century, there is a progressive increase in cost as well as the dissemination of technology that is that is costly in improving and sustaining health care. According to Macri (2016), technology has heightened the governments’ budgets and in case it is privatized, it will promote the medical and wellbeing of Australian citizens and also become cost-effective. The cost of medical technology has recorded increase at an annual rate of 7%. These cost have been bankrupting Australian government as well as the Medicare where for the last five to six years. The cost had accumulated to a staggering 4 trillion AUS. It is the more reason to privatize medical care to increase the number of health care provision and lower the cost consequently.

Demographic adjustments

There is a challenge for the Australian government to sustain the wellbeing and the health of its elderly population. Recently, the government has increased the cost and tighten the budgets of health care services in attempt to achieve that aim. Macri (2016) claims that analysis was undertaken in 2013 found 14% of Australian population aged 65 and above. These analysis project that by the year 2050, at least 21% of the Australian population will be aged at 65 years and above. According to Armstrong et al. (2007), the state, territory and federal governments have failed in creating a substantial adjustment to the popularly and publicly bolstered Medicare system for being scared of voter adverse reactions. This is another reason why health care in Australia has to be privatized to subsidize the cost of healthcare and promote efficiency gains.

Health Inequality and Equity issues

Despite the significant improvements in the health results in the country as identified from the low mortality and heightened life expectancy and extra efficient disease management and others, health care has not been effectively shared equally across all people living in that country (Marmot, 2005). For instance, according to Macri (2016), the life expectancy of the indigenous people (the Torres and the Aboriginal Strait Islander people) is approximately 70 years, which is relatively lower than the non-indigenous population found to be 85 years. It is a huge difference with the medical treatment that prosperous individuals draw versus the less prosperous.

Public and Private Funding of Medical Care

The liberal governments in Australia possess a perception that the health care system, can effectively meet the needs of the public if it is privatized or rather left to the market. The private sector, according to Macri (2016), currently has an approximate of 30% expenditure. Elshaug et al. (2007) claim that the Australian governments will progress to feel the pressure of the high cost of the medical technology, the cost of an aging population and measures to mitigate or eradicate diseases. It is a clear suggestion to the Australian governments to allow market-based mechanisms that set to devote oneself in addressing the huge budgetary difficulties on alternating governments, such as the surcharge of General Practitioners (GP) and pricing to market of health services and many others.

Accelerated Urbanization Health Problems

Macri (2016), argues that the ever increasing urbanization in Australia has led to health issues faced by people living in these urban areas. For instance, in the planning of a healthy and maintain communities, Elshaug et al. (2007), claim that it has subjected the population to issues such inadequate fresh foods, heightened mental well-being thus increased suicide rates, high asthma rates, and increased rates of obesity and many others. Based on these issues, they call for privatization of the medical care heightening the opportunity for business development, in this case formulated around Home, Polyclinic, and Mobile Health Care. Specifically, the social business will provide door-to-door medical servces such as physical therapies, health and well-being counseling and others to mention a few.

Target Market

The Business, which is based on issues of health care, will target generally the Australian population, without prejudice, depending on race, level of actualization and location. Specifically, the business intends to meet the pressing needs of the indigenous people of Australia; these are the Torres and Aboriginal Strait Islanders who are from far North of Australia specifically the elderly. The business also focuses on urban populations that are faced with low access to health foods, those suffering from obesity, and asthma due to pollution, mental issues, and many others. These individuals are the low-income earners or the 5.4% jobless population. These are people who have issues accessing health care insurances or the Medicaid offered by the federal government. The most vulnerable population that the social business targets is the jobless, or the least income earners. Below is a graphical representation of unemployment rates in Australia in percentages as from October 2017 to June 2018.

The graph indicate the population percentages of unemployment rates in Australia from October 2017 to June 2018 (TradingEconomics, 2018)

The Competitive Market

The government hospitals and those in private sector as well as medical insurance providers are the main competitors in mitigating the social issue, which is health. Majority of medical care is offered through public hospitals. The remainder is offered by the private hospitals and clinics such as the dental and physiotherapy as asserted by Productivity Commission of 1999. Some of the main competitors are like Calvary John James Hospital, which offers added value products such as Optical Pharmacy Saver giving off 20% off at the National Pharmacies for profitable medication, specifically for medication meant for diseases sustainability. Another competitor is the Brindabella Endoscopy and Fay Surgery Hospital, which offers its patients, discounts on all prescriptions lenses, frames, and glasses as well as a 10% transition discount on the first year of the hospital insurance cover. While these hospitals offer a range of checkup care and practices, they are located in specific areas but sometimes offer mobile clinic to remote areas.

How different is the Business from Competitors

The intention of the Home, Polyclinic and Mobile Health Care is to offer health care services in the comfort of the patient for various illnesses or injuries. The service is also less costly, convenient and effective as the care one acquires in hospitals of provided by competent nurses. The polyclinic intends to offer both special and general assessment as well as treatment to outpatients, which is effective due to its independence, with a variety of specialists offering more health care services (Bernet et al., 2008). Polyclinics that are special clinics will be popular in sub-urban, metro-cities and small towns across Australia. They will offer medical services such as consultations, examinations, and prescriptions to outpatients as well as dispensing of medicines by a general or special, or single health practitioner. These polyclinics will also offer minor medical procedures such as administering injections or dressing of wounds and many others Basically, it will offer cardiology, general physician, dermatology, gynecology orthopedics and several others. Mobile healthcare clinic can be a milestone in Australia, purposely to deliver health care at full-spectrum of at-risk populations and promote high-quality care at low-cost curing and preventing chronic diseases as well as sustaining. Mobile health clinics will expand the coverage abd the delivery of medical services and care, where the opportunity will be fostered through partnership with varios hospitals, health care systems as well as medical insurers to foster care at lower costs. Unlike Polyclinics these mobile health clinics will offer services such as preventive screening, dental service, disease management, prenatal care, primary care, and behavioral health care.

SWOT Analysis for the Home, Polyclinic, and Mobile Health Care Clinic

Strengths

The Business will have the capacity to use fully equipped caravans to offer health care services to patients in the comfort of their homes, or even at most local areas. The business will integrate all kind of specialist than other health care businesses may lack, such as cardiologists, dentists, physiotherapists as well as GPs. Finally, the business will have fully integrated all technological medical instruments, a fleet of caravans to access various location at once, and offer medical insurances for their clients who lack the platform to access the service and at the lowest cost.

Weaknesses

The business, being a mobile-based clinic setup; it might not have the capacity to offer complex surgical procedures to its clients. It might also incur extra transportation costs such as fuel cost. The penetration in to these new markets will take longer time to get to accept by people from various backgrounds.

Opportunities

The business will focus on accessing remote markets, the vulnerable groups, the ever-busy people in cities, the less active individuals as well as those who require immediate medical services. The opportunity eliminates competitors since most of them are geographically located in one place, but this business opportunity seeks clients wherever they are with little hustle subjected to them.

Threats

Due to the high mobility level, the business is threatened by the emergence of adverse weather conditions and changing customer attitudes towards health care services we will be offering. The risk into a new market that has already been occupied by other similar medical care business might face stiff competition, or tough state or location policies.

The Table summarizes the SWOT Analysis:

Proposed Management and Organizational Structure

The structure of management and organization will be functional, which can be similar to a traditional line of structure, but there is an extensive line of communication. In this structure according to Pearson (2018), the directors under the chief executive officer can communicate to managers that they do not directly control, similarly to the manager connection with the teams.

Owners of the Business

The owners of the health care business will be more of a corporation. The initial owner who will start the business with personal investments will possess the greater share than the partners, who will be the first investors into the business. The investors/partners are the angels; wealthy people from retired medical companies and hospitals executives who will and some have directly invested into the business as suggested by Atherton (2012). Some of these are leaders in specific fields of medical care that will contribute to experiences and network of contacts not leaving out the managerial and technical awareness.

Chief Executive Officer (CEO)

At the topmost of the hierarchy is the Chief Executive Officer (CEO) whose roles will be to deliver the best quality and client care. As a leader, he or she will be needed to develop a productive and positive culture. He/she will set and follow principles for functional excellence, he/she will hire and retain qualified medical professionals and he/she will implement clinical policies and procedures for the excellence of the business.

Managers

Broadly, the roles of the managers in the health care setting according to Carroll and Rudolph (2006), will receive directives from the CEO and break them down to their teams. They have a responsibility of fostering an environment that is capable of offering necessary and quality health care at optimal and profitable manner. They will keep up with the admissible health care laws, standards and technology, and ambassador the organization at external meetings, such as investors’ gathering and community meetings as depicted by Locsin (2018). They decide the budgets, orders and apprehend supplies, carry out stipends and benefits, and disperse everyday communication and functions.

Managers of the Health Care Service and Facilities Departments

The managers in this department will administer healthcare services and facilities, such as the ambulatory health care service to ensure that it offers indirect and direct medical care services to the patients (Technofunc, 2013; Serrano et al., 2006).

Managers of the Medical Equipment, devices and Supplies

In this segment, they will make sure that medical equipment such as the diagnostic, treatment, life support, medical monitoring and laboratory equipment, meet the safety standards. Supplies from manufacturers are of latest models integrated with latest versions of technology. Products across the entire spectrum used along with medical equipment, supplies, and services as well as products not leaving out an application of specialists are up to date and, diagnosed at all times.

Managers of the Medical Service, Insurances and General Well-being on Clients

In this department, the approach will include the assessing, monitoring the delivery of medical services, promote insurance coverage and follow up the general well-being of the clients before and after provision of medical services (Serrano et al., 2006).

Managers of the Pharmaceutical and Related Spectrum

In this department according to Technofunc (2013), the manager will makes sure that all necessarily licensed pharmaceuticals for use, as medications are available. Ensures that they are tested, to make sure that safety and efficacy once they are offered to patients.

Public Relation Office

Due to the size of the business, the organization will require public relation officer who will manage the reputation of the business. The Public Relation (PR) position will involve attaining comprehension as well as support for the customers. The personnel will also try to influence behavior as well as opinion regarding the Poly, Mobile Clinic business. He or she will have to apply all kinds of communication and media to develop, sustain and manage the reputation of the business and that of the customers that the business will serve.

A methodology of Dealing with the Social Problem

First, the business intends to operate across all states and territories of Australia. It means that for effective and efficient delivery of our medical services and cares, there will be erecting of branches in states of New South Wales, Queensland, Western Australia, Tasmania, South Australia, and Victoria. Cities will include; Melbourne, Canberra, Newcastle, Sydney, Brisbane, Gold Coast, Perth, Adelaide. Towns will include Alice Spring, Hobart, Albury, Cairns, Townsville, Launceston, Bryon Bay and many others that can promote easy access. All the branches will have managers for the various departments and team of specialists, GPs, registered nurses, nurses that are still learning as well as local social workers. Elshaug (2007) suggest that each team within the branches will be divided to ensure that the branches’ polyclinics, home care units and mobile clinics in those stipulated areas are all functional and with little or none distress. At ground level, there is an expectation that all medical services are recorded and reported on a daily basis to the manager whom among others ensures that the intended general purpose of the business was met (Smith et al., 2009). After that, the collected information and services offered are presented to the Chief executive officers who are located in every state before forwarded to the head office in Canberra; capital city of Australia. The managers also will have the responsibility of ensuring that the insurance companies, such as the Bupa, the Medibank, the Australian Unity, including the medical research institutes such as the Walter and Eliza Hall Institute of Medical Research, the Garvan Institute of Medical Research are offering contemporary measures unto which the business will operate (Walshe and Rundall, 2001). Together with these institutions, service provision will be easily delivered applying medical information that the managers from each branch will acquire from these organizations.

Service Delivery to Beneficiaries

Home Healthcare will be offered to the older adults covering a wide range of services, thus delaying the need for long-term nursing home care. It will involve physical and occupational therapy, skilled nursing, speech therapy. It will also involve assisting with functions of everyday life such as bathing, eating, dressing, and daily walk. It will include services such as housekeeping, cleaning and cooking not leaving out monitoring of one’s medication. The polyclinic medical care will be distributed across all the branches across the country. The intention is to offer medical services and treatment of a wide range of illnesses. Bernet (2008), depict that it focuses on outpatients, offering dental, screening and laboratory services as well as offering general disability assistance schemes. Mobile Clinic Hath care will also be situated in all branches in the country. It intends to access remote areas or areas that individuals are unable to access our branches. It will offer medical services to insured and uninsured individuals and children at community level whom usually only access health care in times of emergencies. According to Weitz et al. (2001), it is meant to offer medical care in a timely method to those who are perceived to need it. It will focus on taking care of all-round well-being, treat chronic conditions such as diabetes, high blood pressure, and heart issues. It will offer immunization, screenings and acute care of illnesses or even minor accidents. It will coordinate patient’s medical care across all settings as well as times when one might require visiting a specialist or attending a hospital. Finally, it will enroll health insurances assistance.

Stage of the Business

The business is currently setting up branches of home, health care provision, polyclinics and mobile health care clinics across the country. Some of the major cities such as Melbourne, Sydney and the Gold Coast have already established themselves dealing with issues such as; treating chronic illnesses, asthma, high blood pressure, diabetes, and the likes. The business has already started offering home care among the elderly and other individuals with special needs at the suburbs. It has worked towards accessing areas within and outside the cities as they identify new markets. Having been in operation for the last one year, and already captured three cities’ markets with over a million customers, making sure that the health care services delivered are at optimal level with positive results, the cost of health is subsidized when compared to competitors. The business is projected to have set up branches across all states and towns in Australia in the next four years.

Funding

The establishment of the business in Canberra began with my personal investments, that is, personal savings and collateral assets that totaled to at least 1 million AUD. My long-term objective and commitment towards the business steered my intentions by taking a risk and diversify as well as expand the business to other states and cities. In addition, family and friends played a vital role by offering loans during the set up the first business premise. It managed to accumulate loans from family and friends of about 500. 000 AUD. Notably, the business was first set up in Canberra and started to yield profits in offering medical care services, it proved to investors as well as bankers such as Commonwealth Bank of Australia that also offered a loan of another 500,000 AUD with a return interest of 4% for the next four years. The Medibank Private Health Insurance that partnered with the business also invested into the business offering an investment of 300, 000 AUD and offered free registration of patient medical insurances for the first 1000 individuals that we served as we projected its growth and venture to other states. The startup had managed to set up its resources and operations with a capital of 2.3 million AUD. As the business will have branches in various states hence it demand for more resources (workforces and financial). De Jesus (2012) and Saigal (2017) recommend that more funds must be included from financers and expertise from such as businesspersons, retired medical companies, and hospitals executives who will and some have directly invested into the business. Some of these are leaders in specific fields of medical care that will contribute to experiences and network of contacts not leaving out the managerial and technical awareness. Having integrated all these investors and angels to assist in setting up and running the Healthcare business, for the last one year, the business has been able to generate profits that should manage to cater for its activities and save for future investments. Since the business targets that client at the lowest level for a small fee, Aronsson (2013) propose that the more the customers the business attracts, the more the revenues generated.

A 12 months Financial Projection

The business being in operation for a year now, the following is the cost incurred over twelve months:

The first month was the initial start of the business, where the cost was 220,000 Australian dollars. The cost was high due to the cost of the initial franchise, the office and service equipment, recruitment, training programs, advertisements, supplies, legal documentation of business, utility deposits, leased premises, first month remunerations, insurances and compensations, state bonds, caravans, license, and permits. The following months catered for incurred expenses such as employee remunerations, consultants’ fees, accreditation, transport costs, insurances, advertisements, medical supplies, equipment maintenances and other miscellaneous.

The following is the revenue collected over twelve months since the business started its operations:

The revenue that was collected indicated a consistent increase since its first month of operations. While compared to the initial cost of the business, healthcare business started with a little number of customers since they had little knowledge of the service offered irrespective of the low cost of service offered. Over time through quarterly annual advertisements, the revenue has increased consistently as depicted by de Jesus (2012).

The table below will project total revenue that will be collected if all six branches from the six states of Australia will be operational.

These projections suggests an acquisition of interest from the mid of the year to the end, thus offering investors some numbers to look at before they made their decision to invest in the business. However, the business focuses on long-term revenue and interest generation, just like the first year, other branches might undergo similar trend, with some states completely dependent on already existing Medicaid and others adopting our services fully.

Internationalizing the Social Business

The business will venture into foreign markets such as those of New Zealand, Indonesia, Solomon’s Island, New Caledonia, and Timor-Leste. It is after several researches that it was discovered that many people from these countries travel to Australia to access medical care and services. According to Jech, Magnani and Freitas (2007), the venture is increasingly tradable with patients having an opportunity to attaining a wide range of medical care packages to choose from, not just from those provided by their local hospital, but also from Home, Polyclinic and Mobile Health Care Clinics. In two to three years, the venture will have been fully established in the five countries mentioned above. Within the first year of rolling out the business, the main markets to target are those of New Caledonia, Solomon’s Island and Timor-Leste. Reason is that many individuals have been recorded to seek medical care and services in Australia. While there would be a disadvantage of language, cultural barriers as well as the inadequate knowledge of the local socio-economic and business structures in these nation s according to Khoo (2011), the demand of health care is immense, leveraging on the service market power, superiority of the service techniques, and the first to offer this kind of business in these countries. Unlike the high competition in Australia and less income generation, the internationalizing of the healthcare business will offer more profits than it is generating in Australia.

Conclusion

The introduction of Home, Polyclinic, and Mobile Clinic Health Care Business in Australia is meant to solve the adverse social issue of health. Despite the efforts the Australian federal and territorial governments have made in mitigating the social issues by introducing Medicaid and several private institutions such as Insurance companies and hospitals, they have failed to meet the needs of the marginalized individuals such as the aged, the natives Australians and several other low-income earners. The business plan has already done its one-year pilot program to project its likelihood to succeed in Australia for the next four years. It is also venturing into neighboring countries such as New Caledonia, Solomon’s Island and Timor-Leste that will offer more interest rates compared to Australia based ventures.

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