Porter's 5 Forces In Health Care

According to Michael Porter (2008), the key reason for the existence of intense competition and rivalry in the health care industry works as a mechanism to increase value for patients. Competition or opposition has ensured provision of better products and services to satisfy the needs of customers. It is capable of increasing value for customers over time. Quality and process improvements, as a result of competition or opposition leads to decreased cost and increased customer satisfaction (Porter, M. 2008). Michael Porter’s “Five Forces” helps to gain a better understanding of the competitive nature that exists in the external environment.
Threats of New Entrants: With the current situation of President Trump’s aim to replace or repeal the ACA, there is a high probability of it being replaced or certain aspects of it being repealed. With some stakeholders citing rising healthcare costs and less value obtained from it, universal healthcare system or single payer system could
The majority of American healthcare consumers, approximately 49% who receive health insurance through an employer and 32% through a government program, may not notice as many changes of rising premium costs or benefits in health insurance coverage. However, any changes in the ACA has a significant impact on the demographic environment. The Congressional Budget Office (CBO) estimates that changes to provisions of the ACA especially for insurance purchased in the nongroup market and to the Medicaid program would drive up the number of uninsured people to 21 million in 2020 and then to 24 million in 2026, weakening the ACA’s vision (Congressional Budget Office, 2017). This act has greatly impacted individuals with pre-existing conditions, children under 26 years and the uninsured poor income individuals to receive health insurance, increasing their accessibility to