As small businesses struggle to regain their footing amid a widening recession, the complex topic of healthcare has emerged as a focal point of a national policy debate.
At least three healthcare reform proposals are working their way through Congress this summer, and the outcome of those competing plans will have a dramatic impact on businesses, healthcare providers and consumers across the nation.
With the financial stakes so high, HispanicBusiness Magazine for the first time presents a healthcare sector analysis. In this issue, in the coming months, and at HispanicBusiness.com, we will delve deeply into healthcare markets and the challenges they face.
With the industry at a historic crossroads, Hispanic entrepreneurs in the healthcare business have offered an insightful analysis of what the future may hold for small businesses, the government, and the growing number of people who are without healthcare insurance.
These are good times for healthcare companies that contract with the federal government, and the first person to admit this is Ted Terrazas, chairman and CEO of San Antonio, Texas-based TerraHealth Inc.
"The government has a lot of work," Terrazas told HispanicBusiness Magazine. "Right now, during the recession, it's a great place to be ... with our nation spending so much in the Department of Defense and the stimulus package."
From a business standpoint, the 8-year-old company's biggest problem might be its own success: Its revenues dropped nearly 18 percent in 2008. But that's largely because the Department of Defense contractor is getting too big to be considered a disadvantaged business, meaning it no longer qualifies for certain federal contracts.
"We've replaced them all," insisted Mr. Terrazas, who, prior to starting the company, retired from the military as a hospital administrator at age 40. Moreover, he said, the company is poised to double its size by the end of 2010.
The TerraHealth business plan includes a dizzying array of functions. In Afghanistan, the company was responsible for getting a hospital up and running so the Afghanis could take it over. In New Orleans, after Hurricane Katrina wiped out the city's hospital services, TerraHealth helped set up a floating hospital in a huge Navy ship named the USNS Comfort. The company also runs "readiness centers," where TerraHealth doctors conduct physicals and other assessments for soldiers coming to and from Iraq and Afghanistan.
"Everything that has been bad for the country has been good for us," Mr. Terrazas said wryly.
When it comes to healthcare reform, Mr. Terrazas confessed to being a "bit of a maverick." Although Mr. Terrazas acknowledged that the costs of healthcare are going up, he disagrees with the conventional wisdom that this trend should be reversed. The reason: You get what you pay for, and if a society demands better care, it's going to be expensive.
"Americans have a high standard for healthcare," he said. "If you push that cost down, you are going to get inferior quality -- the kind of quality Americans don't want."
Pacer Health Corp.
Another lucrative element in the healthcare sector is the business of hospital management.
Rainier Gonzalez is the 36-year-old CEO of Pacer Health Corp., a Florida-based healthcare company that concentrates on buying distressed hospitals in small markets and turning them around.
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