Researches On Investment Management Of Expensive Equipment In The Hospital

Health care is a major problem to the livelihood of a country. Now,every country is faced with the issue of rapid creasing of medical cost. The increasing of medical cost bring mang problems to the government, individuals and third-party payment institutions.For the government, so much medical cost restricts the roles in other areas and the financial faces deficit; For an individual, because China is a developing country and health insurance the system of health insurance is not yet perfect, high health care payments make individuals face the risk of bankruptcy;For third-party payment agencies,they have to pay much money.In orde to solve this problem,they have to boost the rate of insurance. Adverse selection phenomenon appeases and the environment of health insurance market becomes worsen.There are many reasons that led to increased medical costs ,for example, the improvement of economic level,population aging,strengthening of medical safety,the changing of disease spectrum and mang investments of expensive equipment.In this paper, we focus on the affection that expensive equipments brings to the medical costs. This decision is determined by the current economic situation.In 2007, the financial crisis coming from U.S. sweeped the world, and China's economy was seriously affected.Replying to this crisis, our government intends to take 4 trillion to stimulus our economic. Much of these funds would flow into the area of health and the hospital will buy mang expensive equipments driven by interest.The cost of health care will increase.In this paper,firstly,we describe the relationship between the investment of expensive medical equipment and the increasing of medical cost using the theory of Organic Composition of Capital and the theory of Supply-Induced Demand.Then we check this relationship by Econometric approach. In the third section, we focus on CON Program. CON's experience shows that in order to control the cost brought by large-scale equipment,we need a comprehensive management system.Finally,this article discuss the management of expensive equipment including investment in equipment,changing the charging system,the introduction of competition.Marx divides capital into constant capital and variable capital according to the role in the process of production of residual value. Constant capital change its form in the process of reproduction but keeps its size steady; Variable capital can produce surplus value and make capital larger. In the hospital, capital can be divided into two types basing on similar criteria: One is equipment, plant and other fixed capital,we denote it by C; The other is the medical staff and management personnel,we denote it by V. In this article, we assume that there is no surplus value in the operation of hospital, so that the price of medical services is decided by C & V. The size of V is determined by the efficiency of manage staff and level of diagnosis and treatment of medical personnel , but it is difficult that these indicators have significant changes in the short term. Therefore, in this paper we assume that V remains unchanged. Finally, the price of medical service is determined by C only.The increasing of expensive equipment bring the increasing of C and the organic composition of capital and finally make he price of health services higher and health expenditure increase.Different from the general market, in the medical market, there is asymmetry of information between doctors and patients.Doctors have more information about the patient's condition and treatment.Doctors choose treatment programs as a patient's agent.In China's current health care system, hospitals and doctors may be contrary to the interests of patients as an independent subjects of interest. In the process of treatment, in order to improve the utilization of expensive equipment and increase the hospital and personal's income, the doctor may take a number of unnecessary treatments. These additional services will inevitably bring about the increasing of total cost of the health care market .While discussing relationship between health care costs and the investment of expensive equipment,we use inpatient for examination and treatment costs per capita and the number of expensive equipment in general hospital on average.We choose general hospital for two reasons:Firstly, statistics of the general hospital is normal and the data is relatively more accurate;Secondly, the general hospital has larger scale and there are many general hospitals everywhere ,so they can represent the health care market in general. We make scatter diagram using these two indicators.It shows that coefficient of correlation between them is nearly 1 and indeed there is a link between the two indicators.In the middle of 20th century the United States was also facing the issue of rapid increasing of medical cost.So in 1970s somebody proposed the capital management program,we call it CON. The program made certification of equipment. The hospital needed apply to the management departments before making investment, and only approving project can invest.By analysis of CON,we find that ,CON as a conservative management tool, when the existing hospitals get together ,may lead to the emergence of cartels, thereby impeding the industry's internal competition. The affection is not obvious when CON is used lonely, but when CON,rate management and payment management tools are used simultaneously ,it can make a significant results. This tells us that the management of large medical equipment should be an integrated management.In the final part, firstly, we introduced the theoretical basis for the management of expensive equipment, and then presented a integrated management program that includes investment management,payment management and the introduction of competition.