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Finance Environment Matrix

Create a matrix in which you:

  • Identify at least 3 economic trends of the health care payment system.
  • Identify ethics and compliance issues associated with those trends.

Cite 3 peer-reviewed, scholarly, or similar references to support your chosen trends and issues.

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The health care payment system is rapidly evolving, with several economic trends and compliance issues emerging in recent years. As a medical professor, it is crucial to educate students about these trends and prepare them to handle ethical and compliance issues associated with them. In this assignment, we will create a matrix that identifies three economic trends in the health care payment system and the ethics and compliance issues associated with each trend.


Economic trends in the health care payment system:

1. Value-Based Payment: Value-based payment is a reimbursement model that focuses on achieving better patient outcomes and cost savings. This model incentivizes healthcare providers to improve patient outcomes and reduce the overall cost of care.

Ethics and Compliance issues associated with Value-Based Payment:

a. Incentivizing providers to reduce costs may lead to undertreatment or rationing of care.

b. Risk adjustment and data accuracy concerns can lead to inaccurate payment and a lack of trust between payers and healthcare providers.

c. Patients who do not respond well to treatment may feel neglected and left behind.

2. Telehealth: Telemedicine allows healthcare providers to consult with patients electronically for diagnosis, treatment, monitoring, and management of health conditions, eliminating geographical barriers and enhancing access to care.

Ethics and Compliance issues associated with Telehealth:

a. Data privacy and security concerns may lead to unauthorized access to patient information and a lack of trust between patients and healthcare providers.

b. Lack of physical interaction may make it challenging for healthcare providers to make accurate diagnoses, understand complex medical issues, or address urgent medical needs.

c. The lack of regulations concerning telemedicine practices may lead to inferior medical care and lack of uniformity.

3. Consolidation: Consolidation in healthcare occurs when multiple healthcare providers merge to increase efficiency, reduce costs, and improve patient outcomes.

Ethics and Compliance issues associated with Consolidation:

a. Consolidation may lead to a lack of choice in healthcare providers, which can lead to increased healthcare prices and reduced competition in the industry.

b. Consolidation may lead to an increase in patient volume, making it challenging for providers to prioritize individual patient needs.

c. Consolidation can lead to power imbalances, with larger organizations dominating the market and limiting the bargaining power of patients and smaller providers.


1. Rosenthal, M. B., & Landon, B. E. (2014). How should we measure and pay for value in health care?. Jama, 312(14), 1443-1444.

2. Huang, Q., Ranade-Kharkar, P., & Stolting, C. (2021). Telehealth and Privacy: Quid Pro Quo. Frontiers in Public Health, 9, 602833.

3. Chang, A. H., Shih, S. C., & Wu, Y. Y. (2017). The impact of consolidation on hospital prices: Evidence from Taiwan. Health Economics, 26(2), 199-215.

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