MANASQUAN NJ USA -- HEALTHCARE UPDATE NEWS SERVICE(TM) -- JULY 10, 2006: The healthcare industry faces a series of challenges that may change the face of the industry and therefore impact both health providers and payors.

The health costs escalation issue won't go away. With costs continuing to rise there will be more demand for across the board containment. Controlling costs, whether it be administrative costs or costs to consumers, is the top challenge facing the healthcare industry this year.

Health plans are continuing to bring consumer-driven health plan products to market; the federal government cleared the way for health savings accounts (HSAs), and plans are "partnering" with financial institutions to market HSAs. MCOs are waving bonuses at providers to increase quality and patient satisfaction. Finally, all of these developments are unfolding as the move toward electronic health IT is shaping the provider-patient-payor dynamic.

Medicare's prescription drug plan was officially launched with so much across the board confusion from beneficiaries to providers that it is shaping up to be a political minefield come November.

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