Lead Time and Price Quotation Mode Selection: Uniform or Differentiated?

Firms in service and make‐to‐order manufacturing industries often quote lead times and prices to customers. We define uniform quotation mode (UQM) as the strategy where a firm offers a single lead time and price quotation, and differentiated quotation mode (DQM) is where a firm offers a menu of lead times and prices for customers to choose from. Both modes are followed in practice. Firms should determine which is more profitable. We classify customers into two groups: lead time sensitive (LS) and price sensitive (PS). LS customers value lead time reduction more than PS customers. We develop mathematical models of both quotation modes and analyze them to determine the most profitable mode under specified situations as well as the best lead time and price quotations within each mode. We find that DQM is dominated by UQM whenever PS customers have positive utilities from UQM or LS customers have positive utilities from DQM. Otherwise, which quotation mode is better depends on multiple factors, such as customer characteristics (including lead time reduction valuation and product valuation of a customer, and the proportion of LS customers) and production characteristics (including the desired service level and service or production cost).     

A hospital protocol to resolve complaints against staff physicians

Complaints of discrimination or harassment in the workplace have become almost commonplace in recent years, increasing in both frequency and variety. In the hospital setting, this trend is manifested in allegations against members of the medical staff by hospital employees as well as by patients or their families. Whether real or fancied, such allegations are reflective of a potentially disruptive undercurrent of organizational tensions. Left unresolved, they can erode the essential partnership between staff physicians and other members of the health care delivery team. Unsatisfactory patient experiences may also damage the reputation of the institution and thereby undermine its viability. With either group of complainants, allegations of malfeasance that are not resolved at the source in a timely manner are far more likely to result in expensive, time-consuming, and potentially damaging litigation.     

Corporate compliance programs: risk management for the future

The Department of Justice has estimated that the government loses $100 billion annually in health care fraud. Consequently, the government's health care fraud enforcement activities with respect to all health care providers and suppliers continue to grow. Last year alone, the government collected more than $8 billion in settlements, fines, and penalties involving health care fraud. Recent settlements with the government have begun to include corporate compliance programs that require continued government oversight of the health care organization as an essential part of the settlement. The first section of this article describes the legal significance of health care companies' having corporate compliance programs. The second section provides a sample list of topics that should be included in any corporate compliance program. Finally, we describe various issues related to the creation and implementation of corporate compliance programs.     

The mandate for investigational cancer therapies

The heated national health care reform debate of the summer of 1993 has now simmered down, but pieces of the debate are still percolating along at the state level. Within the past year, numerous states have introduced bills that would mandate insurance coverage for investigational cancer therapies--in particular high-dose chemotherapy and bone marrow transplant for breast cancer. The problem with these initiatives, well-intended though they may be, is that they threaten to spread unproven technologies at a rapid rate and at the same time miss the opportunity to collect data that would prove the safety and effectiveness of the methods. The author explores these issues and suggests how managed care companies can play a more aggressive role in parrying the threat.     

The ascendancy of primary care: permanent or temporary?

The conventional wisdom strongly suggests a health care provider food chain for the future: Primary care physicians (PCPs), principally family practitioners, on the top playing the lead role, distantly followed by specialists, with hospitals and other ancillary services even further down the line. Is this a reasonable expectation? Will PCPs dominate the new systems? Or will they be but one of many equally necessary components of these developing integrated health care delivery organizations? Looking at the various models now developing, it would seem that future integrated delivery systems will utilize both PCPs and specialists, but with strong augmentation from a diverse assortment of other health care professionals, including nonphysician providers, educators, and administrators. To separate the illusion of primary care dominance of the coming health care system from the likely reality, we should first determine what is driving the apparent present demand for primary care physicians. Next, we will examine the possible and probable reactions to that demand from an economic standpoint and from the points of view of both health care professionals and the public. Finally, we must try to picture how health care provider organizations of the future are likely to look and how they will integrate their health care professionals.     

A comparison of quality and utilization problems in large and small group practices

Physicians practicing in large, multispecialty medical groups share an organizational culture that differs from that of physicians in small or independent practices. Since 1980, there has been a sharp increase in the size of multispecialty group practice organizations, in part because of increased efficiencies of large group practices. The greater number of physicians and support personnel in a large group practice also requires a relatively more sophisticated management structure. The efficiencies, conveniences, and management structure of a large group practice provide an optimal environment to practice medicine. However, a search of the literature found no data linking a large group practice environment to practice outcomes. The purpose of the study reported in this article was to determine if physicians in large practices have fewer quality and utilization problems than physicians in small or independent practices.     

Tissue Dosimetry, Pharmacokinetic Modeling, and Interspecies Scaling Factors

Interspecies scaling factors (ISFs) are numbers used to adjust the potency factor (for example, the q1* for carcinogens or reference doses for compounds eliciting other toxic endpoints) determined in experimental animals to account for expected differences in potency between test animals and people. ISFs have been developed for both cancer and non-cancer risk assessments in response to a common issue: toxicologists often determine adverse effects of chemicals in test animals and then they, or more commonly risk assessors and risk managers, have to draw inferences about what these observations mean for the human population. This perspective briefly reviews the development of ISFs and their applications in health risk assessments over the past 20 years, examining the impact of pharmacokinetic principles in altering current perceptions of the ISFs applied in these health risk assessments, and assessing future directions in applying both pharmacokinetic and pharmacodynamic principles for developing ISFs.     

Mirror, mirror on the wall: reflections from failure to establish a truly uniform national health care policy

When the author gazed into the proverbial mirror and asked if the U.S. health care system was the fairest of them all, it shattered. In this article, Thompson tells why the system is broken and what failure to fix it means to physician executives. He suggests that we, as Americans, must reinvent ourselves by realigning our value systems and and stifling our obsession with profit before trying to reinvent health care.     

A Path Analytic Model of a Theory of Quality Management Underlying the Deming Management Method: Preliminary Empirical Findings*

Despite the impact that Deming and his 14 Points have had on the practice of quality management, empirical support for the effectiveness of the Deming Management Method has not advanced beyond the presentation of anecdotal, case-study evidence. In part, this is because theory to guide the conduct of empirical research has not been available. Only recently has such a theory of quality management to describe and explain the effectiveness of the Deming Management Method been articulated in the literature. This paper continues the journey of theory development; it reports the results of an exploratory empirical analysis of an articulated theory of quality management underlying the Deming Management Method. The constructs in the proposed theory are operationalized using measurement statements developed by the World-Class Manufacturing research project team at the University of Minnesota and Iowa State University. Path analysis is applied to the World-Class Manufacturing project data to explore the empirical strength of relationships advanced in the theory. The path analytic results provide support for several of the proposed relationships in the theory, and more importantly, suggest a number of new relationships which have not heretofore been proposed.