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The healthcare industry is big business. In 2020, Wilson Analytics in partnership with the California Health Care Foundation estimated national health spending in the United States to be $4.1 trillion (Wilson, 2022). As we know with the currently aging population, this number will only grow due to an increased need for health-related services, inflation, shortages of personnel and supply, and more. Those providing care and services must be knowledgeable about the financial complexity and challenges in the healthcare industry.

In 2020, just over one-third of all healthcare spending was attributed to government sources. Since that time, we know the number has grown exponentially due to the effects of the global COVID-19 pandemic on the economy. Spending during the pandemic included increasing federal medical assistance to state Medicaid programs; new provider assistance payments under the relief fund and paycheck protection programs; and escalating public health spending for vaccine development, testing, stockpiles, and grants to states, as well as to fund the public health activities of the Centers for Disease Control and Prevention (Wilson, 2022). The short-term effects from COVID-19, in 2022, have painted a bleak financial picture for most of the providers of healthcare. Longer-term financial and business effects from the COVID-19 pandemic are yet to be seen.

It is essential for all providers of healthcare services to develop a basic understanding of how business in the industry works: from obtaining supplies (and from where), attracting talent, accessing capital, learning about the costs to do business, how payment in the healthcare industry is sent to those providing care, the impact from the interest of private equity in healthcare fueling more for-profit entities, and more. This chapter suggests a number of ways for individuals to add their contribution to the larger whole.

In addition, an unfortunate cycle in healthcare is that during times of surplus, or when profits are robust, the risk threshold for leaders tends to decrease, and scrutiny for the cost of doing business reduces with it. This might include the addition of personnel, supplies, or processes that aren’t fully vetted for the value they might offer. Even more ominous, though, is a historical tendency in healthcare to be “addictively additive” in the work we request of others. This includes supply chain and work processes where new work is often layered on to what already exists without thoughtful planning or execution.

The neglect felt by either or both of these mindsets may in part be due to healthcare’s slow affinity for change. This potentiates the desire to freeze, change, and refreeze—slowly—and over time. The COVID-19 pandemic exacerbated a “fire-fighting” mentality where many problems had a “bandaid solution” for the day, and these solutions weren’t meant to be long-term.

Additionally, there is often a failure to recognize the complexity of the healthcare entity as a whole. Healthcare organizations are complex adaptive systems that seem to require an inordinate amount ...

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