Healthcare Issue: Academic Medical Center


Medicine is one of the oldest professions known to humanity. From ancient times, certain members of the society played the role of doctors or healers. There has been tremendous growth in the field over the centuries. This growth has been the result of continuous research to improve the quality of healthcare offered to patients. The Academic Medical Center (AMC) exists against this backdrop. It represents a modern incarnation in the practice of medicine where research and medical care to patients go hand in hand.

The concept provides medical professionals with an opportunity to practice as well as conduct research on how to improve their practice (AMC, 2011). This paper looks at the issues surrounding the financing of the AMC.

Programs at ACM

The three main services that the ACM offers include “integrated patient care, fundamental and clinical scientific research, and teaching” (AMC, 2011). The ACM is primarily a hospital that offers medical service to patients. Providing integrated patient care is a recent trend in medicine, which aims at making provision of healthcare coordinated. This means that services relating to diagnosis, treatment, and care receive coordinated attention. It also means that there is a deliberate drive to enhance provision of services by increasing efficiency and improving ease of access to the satisfaction of the clients.

The second defining characteristic of the ACM is that it is a clinical scientific research center. At any one time, there are several clinical research projects underway. The design of the center is such that there are always a large number of resident research professionals thereby creating a hub for scientific collaboration. Currently, there are twenty-one ongoing research projects (AMC, 2011). Some of them are entirely under the secretariat while others are collaborative projects with other institutions.

The third role that the ACM plays is teaching. A natural part of research is dissemination of results. Hence, providing teaching services provides researchers with an outlet for the information generated. The center concentrates on providing research opportunities for PhD students (AMC, 2011). As a research institution, these students stand to benefit best from it. At PhD level, the students do not present a huge teaching burden to the institution but offer opportunities for providing research services as they learn. This is beneficial for both the students and the institution. The students get the opportunity to learn within a highly reputed scientific community, while the institution gets a pool of motivated researchers to participate in its projects.

Sources of Income for ACM

Since the ACM is a conglomerate, there is no single source of income, but a set of sources. The most significant source of income for ACM is research grants (Fitzgerald, 2003). Depending on the type of research, grants come either from the government or from private corporations. Charities also offer research grants though their contribution is not as significant as the other two sources. Normally, funders issue grants on competitive basis and impose certain conditions. It is the role of ACM to prepare its researchers to compete for research grants.

The next source of income is patient fees paid for use of the hospital facilities found at ACM. The money patients pay cover the costs of offering the services that they need such as consultation, laboratory services, and pharmaceutical services (Bodenheimer, 2005). In addition, patients pay for specialized services such as dialysis, mammograms, CT scans, and radiotherapy. The money paid in most cases only pays for use of the services hence it is not a very sustainable way of funding research programs.

The third source of funding for the ACM comes from the teaching services offered. The students pay to learn at the facility. Their financing normally comes through scholarships and research grants. The sponsoring organization provides the student with the money they need to carry out their research project, which pays for the use of ACM’s facilities. In some cases, philanthropists donate money towards certain courses that ACM promotes.

Cost Drivers, Cost Controls, and Trends

In the United States, research shows that the cost of providing healthcare increases at a rate higher than the average inflation rate (Bodenheimer, 2005). This means that more people are unable to access healthcare, especially those that need it the most. The significant cost drivers within ACM include the cost of retaining specialized staff. The prevailing challenging economic times have put pressure on healthcare professionals who now seek the best openings available for them to increase their remuneration (Kovner, Knickman, Weisfeld, & Jonas, 2011, p. 187). There is also a rise in the cost of inputs for all the three service areas that ACM focuses on. The cost of research equipment including maintenance and operation has been increasing over time and is now prohibitive. Another cost driver is that there is increasing regulation over research that affects human life. The researchers are under constant professional and ethical scrutiny, which ends up increasing the overall cost of research. ACM faces great challenges relating to financing of the services offered. This is making cost control central to the strategic initiatives that will make it possible for ACM to survive into the future. The main reason for the need for cost control is that there is reducing funding from government, which scholars project to reduce further in the near future.

The economic environment is the main reason for a decrease in the amount of funding available for research. Many funding agencies and governments have cut back on the amount of money spent on research (Bodenheimer, 2005). This means that there is increasing competition from research institutions that compete for funding. On the other hand, there is an increasing realization that integrated services provide the most economical way of offering healthcare. In this sense, ACM has a strategic advantage. As other institutions seek partners in order to achieve the dream of offering integrated services, ACM can leverage on its experience to remain an industry leader. Another important trend affecting the healthcare industry is the move by governments to make healthcare affordable to a majority of the people. In different countries, different measures are in place. The flipside is that some of these measures constrain healthcare providers such as ACM to an extent that the quality of services offered suffers.


In conclusion, ACM stands well poised to remain a market leader in the provision of integrated healthcare services. There are challenges now relating to funding options and funding strategies, which should ease with time. After all, healthcare is a basic service that all countries must maintain. In this sense, there is an obligation on the part of all the stakeholders to ensure that ACM is able to offer services in the long term.


AMC. (2011). AMC at a Glance. Retrieved November 17, 2011, from Academisch Medisch Centrum:

Bodenheimer, T. (2005). High and Rising Healthcare Costs. Part 1: Seeking an Explanation. Annals of Internal Medicine , 847-854.

Fitzgerald, M. R. (2003, March). Financial Support Arrangements between Academic Medical Centers and Faculty Practice Plans. Retrieved November 17, 2011, from Powers Pyles Sutter & Verville PC:

Kovner, A. R., Knickman, J., Weisfeld, V. D., & Jonas, S. (2011). Jonas and Kovner’s Healthcare Delivery in the United States. New York, NY: Springer Publishing Company.


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