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1. Determine how this Federal law will affect market-driven and non-market driven decisions.
The patient protection and affordable care act being a complex legislation provides a broad brush impact in marketing and not marketing decisions. It represents redistribution of income from the young and healthy population to the under 65 less healthy group. It will influence non market driven decisions since the young healthy population will be induced to enroll in health insurance plan. This will enlarge the risk pull and at the same time their will be enrolment of less risky participants. This will lead to a lowered health insurance premium for most risky members. This federal law will raise medical and dividend on the upper income holders at the same time increasing their income taxes. It will affect market driven decisions by the redistribution of income from high income holders to low income holders. It is therefore eminent that there will be a negative effect on work incentives and investment which will lead to a depressed potential economic growth. The PPACA does little to control healthcare costs since it only adds mandated benefits but discards underwritten considerations (Foster, 2010). It increases demand among those with no or little out of pocket costs. Carriers will be unwilling to go to market with uncompetitive total cost because of increase commissions of brokers' generosity.
2. Describe the circumstances at which you would prepare a strategic plan to include this new law in your marketing decisions, knowing this new law may or may not take effect.
The underlying circumstances when preparing a strategic plan would be based on the idea that estimated savings may be unrealistic and how the medical loss ratio provided on the healthcare bill would impact insurance brokers. The plan would be based on limiting amounts of premium s that can be devoted to administration and profit (Sultz & Young, 2010). This must be considered because it will lead to reduced insurance rates. Since PPACA requires health insurance coverage on all consumers, the loss ratio rule should be designed to prevent carriers from attaining underserved monetary windfall. The plan should be focused on the exempted broker commission since the federal law limits percentage premiums spent on profit and administration. The total cost of policies including consumer compensation will also be taken into consideration. The plan should include prevented cuts which would in turn take care of projected savings. It should also take care of small entitlement within massive entitlements where the collected premiums would increase surpluses before benefits are paid.
3. Discuss how each of the five (5) environmental forces will be affected by the new law, which you believe will be the most affected and why.
Environmental forces here are social, economic, regulatory, competition and technology. Consumers will be given the chance to change their needs and wants. The federal law will result to a change in technology and there will be increased government regulations to change the state of economy. Competing entries to the market will also be increased by the legislation where carriers will be forced to work with or against the factors. The new law will determine how efficiently to deal with environmental factors. Socially, PPACA will have a negative effect on work incentives and investment and thus depressing economic growth. It will result in healthier workforce where a healthier workforce would be a productive workforce. The most affected environmental factor would be economy since increased taxes related to PPACA will change the composition of funding from government expenditures this is because there will be decreased borrowing which will result to more taxes. Brokers subjected to high tax payments will cut back on their savings in order to fund high tax income payment (Washington Post, 2010). The decreased credit supply will in turn affect decreased treasury demands for credits.
Macro effects on economic performance will be resolved by productive resources of the private sector to the government. Technologically, companies are likely to increase market demands since advertisement procedures will be increased through technological differences. Seles would be conducted through phones and chart cites since they are the latest new inventions. For example, it is now a common knowledge that home phones are becoming extinct because of cell phones. Insurance companies will thus make changes with regards to customer contacts. Market mix changes are adopted by insurance companies to new regulations (Washington Post, 2010). Changes are therefore adjusted to uncontrollable factors (change in technology) by changing controllable factors because a change in technology is something that most corporations have no control over. They have no measures to stop the change so they only adopt to the changes by forecasting on huge the market.
4. Describe one new target audience and include the characteristics of their demographic and psychographic profiles.
The law focuses on private health insurance market to increase coverage to individuals with pre-existing conditions. The focus entails improved prescription coverage in medical care and Medicare trust fund. The law nationally implements guaranteed issues and community ratings in order for insurers to offer same premiums to applicants equally based on the same sex, location and age. Medicare has been eligibly expanded to cater for all individuals and families with gross income of 133% of poverty line (Sultz & Young, 2010). It governs that firms with 50 or more employees and not offering health insurance, are required to pay "shared responsibility payment" when government subsidizes healthcare. Insurance exchange is expected to start in each state and thus offering market for individuals and small business organizations to buy insurance and to compare premiums and policies. Insurers are supposed to be spending 80% of individual and small group premiums and 85% of large group premiums.
5. Technological changes with regards to healthcare services will likely increase understanding and sales of premiums. These companies are likely to increase market demands since advertisement procedures will be increased through technological differences. Seles would be conducted through phones and chart cites since they are the latest new inventions. The total cost of policies including consumer compensation will also be taken into consideration. The strategy will include prevented cuts which would in turn take care of projected savings. It should also take care of small entitlement within massive entitlements.
6. HIPAA Privacy provides national protection to personal health information under health organizations. The protected information gives patients a range of rights with respect to information protection (Foster, 2010). Federal privacy is balanced so as to allow the disclosure of personal health records only when it is needed for patient care or when needed for other important purposes. It was therefore important for the manager to implement the marketing plan. The rule specifies a range of administrative, technical and physical safeguards for entities covered for assurance of available electronic protection, confidentiality and integrity.