Financial Incentives In Health Care Looks At The Demand And Supply Side
Financing of any kind on any field needs both the demand and supply side to be considered to make it useful for the borrowers and high yielding for the lenders. This principle is applicable to the health financing systems as well. It is only then that the health services will be motivated to seek more such financing when they need.
On the other hand, there will be more providers of these types of funds ready to come up with more tailored loan products and financial solutions to meet the large number of diverse needs. As far as the health services are concerned, they will be able to provide quality health services to the people.
With different types of health financing interventions available, these are typically categorized into two broad categories, the demand and the supply side. This categorization is done based on the differences in who is the actual receipt of such financial incentives.
- The demand side of such financing interventions provide vouchers or financial incentives to the users directly and
- The supply side of it provides the same to the provider as in pay-for-performance.
These are the incentives or payments that motivate the health care practice in specific behavior that may not have been possible to bring in without providing any financial benefit. Such programs typically combine both the demand side as well as the supply side which helps in improving the overall approaches to provide better service access and health quality.
That means, in short the health financing companies, whether it is a line of credit, a traditional bank or other alternative lending sources such as Liberty Lending, must now look for different and more productive approaches so that it will improve both the supply of as well as the demand for better health services.
Overview of health systems strengthening
In order to strengthen the health systems there is an immediate need for private-public partnership. This will help the health care system to bridge the gap between the demand and supply of heal care services. This can only be achieved when the demand side and supply side of the financing interventions is a-bridged!
This is because there is a lot of importance and connotation of health financing family planning, especially for the countries that want to have more sustainable family planning programs. This is because:
- These countries need to ascertain that there are sufficient funds to mobilize in this specific aspect and
- It is also required to make sure that these funds are pooled in properly so that it allows cross subsidization.
This will ensure that the family planning services are provided as well as purchased in a more efficient way. It will also motivate the health care providers to offer a more diverse range of value added and high quality health care and family planning processes.
Health financing reforms
The financing options finally could benefit the health care sector and help them to undertake broader and more varied health financing restructurings toward UHC.
- This will particularly help donor funding to prevent the declining health care infrastructure and quality in the major countries in the world that are looking for more effective ways to improve and mobilize their domestic resources.
- This will also help them to enhance the accessibility and improve the quality of health services for the population, especially to the poor segment of it.
- In addition to all these, it will also provide them with adequate and more sustainable financial protection from the out of pocket health expenses both for the health care provider and more importantly by the receivers of such health care services.
In short, these reforms will offer them a greater opportunity to mobilize their available as well as additional resources for family health care and planning so as to improve their efficacy by a significant margin. Most importantly, it will have a serious and positive effect on family health care spending.
Merchant cash advances
Such financial reforms will speed up the process of bridging the financial gaps, especially with the help of the merchant cash advances.
- It is noticed that there has been a significant rise in the number of hospitalization in private facilities over the past two decades both in the rural as well as in the urban areas.
- It is also noticed that there has been a remarkable rise in the preference for the private setups to avail health care services.
Therefore, there is no way or reason that these private set-ups must be left in a sticky situation where they will have to struggle for getting sufficient funds for their sustenance and smooth operation.
In such situations, these private setups find that acquiring cash advances is the more viable and accessible alternative than procuring a bank loan. Though these cash advances are unsecured loans, these help them significantly to keep their business afloat.
Role of the alternative lenders
The role of the alternative lenders in this matter is not ignorable. They provide these cash advances to all irrespective of the size of the business. Their offers come with all possible types of credit values providing the health care service with a lot of diverse benefits. The primary benefits of these merchant cash advances are aimed for specific people such as:
- Those optometrists who want to buy any new equipment
- The general practitioners who want to expand their existing clinic or hospital
- The chiropractors or orthopedics who want to start their individual clinic for therapy
- The dentists want to build their own facility and even
- For people who want 2nd, 3rd, or 4th position loans.
These merchant cash advances help the health care providers to bridge the gap between the demand and supply of both finance as well as the health care services of the people. This makes the entire process easy not only to avail the loans due its short processing and disbursal time but also to provide better health care services faster. There is no pressure or worry regarding the repayment as it will be collected as a percentage of the future receivables.