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Submitted URL: https://marketing.ecgmc.com/acton/ct/10977/s-058c-2109/Bct/q-01ac/l-dyn-contact-01a6:e730/ct9_1/1/lu?sid=TV2%3AcFdQEqRqi
Effective URL: https://www.ecgmc.com/thought-leadership/blog/three-ways-health-systems-can-improve-performance-while-building-scale?u...
Submission: On September 15 via api from US — Scanned from DE
Effective URL: https://www.ecgmc.com/thought-leadership/blog/three-ways-health-systems-can-improve-performance-while-building-scale?u...
Submission: On September 15 via api from US — Scanned from DE
Form analysis 5 forms found in the DOM
GET https://www.ecgmc.com/search
<form action="https://www.ecgmc.com/search" method="get" class="search-form">
<div class="input-group">
<input type="search" name="q" id="main-search" class="form-control search-input" placeholder="Search ECGMC">
<img class="search-click" src="//www.ecgmc.com/assets/images/newstyle/black-search-icon.svg" alt="">
</div>
</form>POST
<form action="" method="POST" accept-charset="UTF-8" id="contact-form" class="needs-validation" novalidate="novalidate">
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<div class="form-row">
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<div class="invalid-feedback">Enter First Name</div>
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<div class="form-group col-md-6">
<input type="text" id="contact_lastname" class="form-control" placeholder="Last Name*" name="fields[lastName]" value="" required="" aria-required="true">
<div class="invalid-feedback">Enter Last Name</div>
</div>
</div>
<div class="form-row">
<div class="form-group col-md-6">
<input type="text" class="form-control" placeholder="Organization*" name="fields[organization]" value="" required="" aria-required="true">
<div class="invalid-feedback">Enter Organization Name</div>
</div>
<div class="form-group col-md-6">
<input type="text" class="form-control" placeholder="Title" name="fields[jobTitle]" value="">
</div>
</div>
<div class="form-row">
<div class="form-group col-md-6">
<input type="email" class="form-control" placeholder="Email*" name="fields[email]" value="" required="" aria-required="true">
<div class="invalid-feedback">Enter Email</div>
</div>
<div class="form-group col-md-6">
<input type="tel" class="form-control" placeholder="Phone Number" name="fields[phoneNumber]" value="">
</div>
</div>
<div class="form-group row text-center approve-text">
<div class="col-sm-12 checkbox-parent">
<label><input type="checkbox" checked="checked" name="fields[newsletter][]" id="newsletter" value="newsletter">Yes, please send me <strong>Healthcare Management Insider</strong> monthly<span class="checkmark"></span></label>
</div>
</div>
</div>
<hr>
<div class="checkbox-part">
<h4 class="checkbox-head">I am interested in the following ECG Services:</h4>
<div class="form-group row">
<div class="col-sm-6 col-md-4 checkbox-parent">
<label class="label-head" for="service--strategy">Strategy<input type="checkbox" name="fields[services][]" id="service--strategy" value="7"><span class="checkmark"></span></label>
<label for="service--enterprise-strategy">Enterprise Strategy<input type="checkbox" name="fields[services][]" id="service--enterprise-strategy" value="17"><span class="checkmark"></span></label>
<label for="service--facility-capital-asset-planning">Facility <span class="amp">&</span> Capital Asset Planning<input type="checkbox" name="fields[services][]" id="service--facility-capital-asset-planning" value="11691"><span
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<label for="service--mergers-acquisitions-partnerships">Mergers, Acquisitions, <span class="amp">&</span> Partnerships<input type="checkbox" name="fields[services][]" id="service--mergers-acquisitions-partnerships" value="64"><span
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<label for="service--physician-alignment-network-development">Physician Alignment <span class="amp">&</span> Network Development<input type="checkbox" name="fields[services][]" id="service--physician-alignment-network-development"
value="62"><span class="checkmark"></span></label>
<label for="service--provider-workforce-planning">Provider Workforce Planning<input type="checkbox" name="fields[services][]" id="service--provider-workforce-planning" value="89193"><span class="checkmark"></span></label>
<label for="service--service-line-strategy">Service Line Strategy<input type="checkbox" name="fields[services][]" id="service--service-line-strategy" value="61"><span class="checkmark"></span></label>
</div>
<div class="col-sm-6 col-md-4 checkbox-parent">
<label class="label-head" for="service--finance">Finance<input type="checkbox" name="fields[services][]" id="service--finance" value="8"><span class="checkmark"></span></label>
<label for="service--financial-advisory-services">Financial Advisory Services<input type="checkbox" name="fields[services][]" id="service--financial-advisory-services" value="66"><span class="checkmark"></span></label>
<label for="service--industry-benchmarking">Industry Benchmarking<input type="checkbox" name="fields[services][]" id="service--industry-benchmarking" value="71"><span class="checkmark"></span></label>
<label for="service--payer-contracting-reimbursement">Payer Contracting <span class="amp">&</span> Reimbursement<input type="checkbox" name="fields[services][]" id="service--payer-contracting-reimbursement" value="67"><span
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<label for="service--provider-compensation">Provider Compensation Planning<input type="checkbox" name="fields[services][]" id="service--provider-compensation" value="68"><span class="checkmark"></span></label>
<label for="service--valuation-services">Valuation Services<input type="checkbox" name="fields[services][]" id="service--valuation-services" value="70"><span class="checkmark"></span></label>
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<div class="col-sm-6 col-md-4 checkbox-parent p-0">
<label class="label-head" for="service--performance-transformation-1">Performance Transformation<input type="checkbox" name="fields[services][]" id="service--performance-transformation-1" value="9"><span class="checkmark"></span></label>
<div class="col-sm-12 col-md-12 p-0">
<label for="service--acute-care-performance-improvement">Acute Care Performance Improvement<input type="checkbox" name="fields[services][]" id="service--acute-care-performance-improvement" value="87902"><span
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<label for="service--ambulatory-service-line-performance-improvement">Ambulatory <span class="amp">&</span> Service Line Performance Improvement<input type="checkbox" name="fields[services][]"
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<label for="service--consumer-engagement-access-to-care">Consumer Engagement <span class="amp">&</span> Access to Care<input type="checkbox" name="fields[services][]" id="service--consumer-engagement-access-to-care" value="74"><span
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<label for="service--digital-health">Digital Health<input type="checkbox" name="fields[services][]" id="service--digital-health" value="88719"><span class="checkmark"></span></label>
<label for="service--it-strategy">IT Strategy<input type="checkbox" name="fields[services][]" id="service--it-strategy" value="79"><span class="checkmark"></span></label>
<label for="service--medical-group-performance-improvement">Medical Group Performance Improvement<input type="checkbox" name="fields[services][]" id="service--medical-group-performance-improvement" value="87910"><span
class="checkmark"></span></label>
<label for="service--revenue-cycle-opt">Revenue Cycle Optimization<input type="checkbox" name="fields[services][]" id="service--revenue-cycle-opt" value="69"><span class="checkmark"></span></label>
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<hr>
<div class="addcomment-part">
<h4 class="checkbox-head">Add a comment?</h4>
<div class="form-group row">
<div class="col-sm-12">
<textarea class="form-control noresize" name="fields[comments]"></textarea>
</div>
</div>
</div>
<hr>
<div class="form-group row">
<div class="col-sm-12 contact-footer">
<div class="not-robot">
<label>
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<input type="hidden" class="hiddenRecaptcha required" name="hiddenRecaptcha" id="hiddenRecaptcha" aria-required="true">
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<button type="submit" id="contact_submit" name="submit" class="btn btn-default submit-btn"><img src="//www.ecgmc.com/assets/images/newstyle/arrow-right.svg" alt="">SEND</button>
</div>
</div>
</div>
</form>POST
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<div class="form-part">
<div class="form-row">
<div class="form-group col-md-6">
<input type="text" id="contact_firstname" class="form-control" placeholder="First Name*" name="fields[firstName]" value="" required="">
<div class="invalid-feedback">Enter First Name</div>
</div>
<div class="form-group col-md-6">
<input type="text" id="contact_lastname" class="form-control" placeholder="Last Name*" name="fields[lastName]" value="" required="">
<div class="invalid-feedback">Enter Last Name</div>
</div>
</div>
<div class="form-row">
<div class="form-group col-md-6">
<input type="text" class="form-control" placeholder="Organization*" name="fields[organization]" value="" required="">
<div class="invalid-feedback">Enter Organization Name</div>
</div>
<div class="form-group col-md-6">
<input type="text" class="form-control" placeholder="Title" name="fields[jobTitle]" value="">
</div>
</div>
<div class="form-row">
<div class="form-group col-md-6">
<input type="email" class="form-control" placeholder="Email*" name="fields[email]" value="" required="">
<div class="invalid-feedback">Enter Email</div>
</div>
<div class="form-group col-md-6">
<input type="tel" class="form-control" placeholder="Phone Number" name="fields[phoneNumber]" value="">
</div>
</div>
<div class="form-group row text-center approve-text">
<div class="col-sm-12 checkbox-parent">
<label><input type="checkbox" checked="checked" name="fields[newsletter][]" id="newsletter" value="newsletter">Yes, please send me <strong>Healthcare Management Insider</strong> monthly<span class="checkmark"></span></label>
</div>
</div>
</div>
<hr>
<div class="checkbox-part">
<h4 class="checkbox-head">I am interested in the following ECG Services:</h4>
<div class="form-group row">
<div class="col-sm-6 col-md-4 checkbox-parent">
<label class="label-head" for="servicedata--strategy">Strategy<input type="checkbox" name="fields[services][]" id="servicedata--strategy" value="7"><span class="checkmark"></span></label>
<label for="servicedata--enterprise-strategy">Enterprise Strategy<input type="checkbox" name="fields[services][]" id="servicedata--enterprise-strategy" value="17"><span class="checkmark"></span></label>
<label for="servicedata--facility-capital-asset-planning">Facility <span class="amp">&</span> Capital Asset Planning<input type="checkbox" name="fields[services][]" id="servicedata--facility-capital-asset-planning" value="11691"><span
class="checkmark"></span></label>
<label for="servicedata--mergers-acquisitions-partnerships">Mergers, Acquisitions, <span class="amp">&</span> Partnerships<input type="checkbox" name="fields[services][]" id="servicedata--mergers-acquisitions-partnerships"
value="64"><span class="checkmark"></span></label>
<label for="servicedata--physician-alignment-network-development">Physician Alignment <span class="amp">&</span> Network Development<input type="checkbox" name="fields[services][]" id="servicedata--physician-alignment-network-development"
value="62"><span class="checkmark"></span></label>
<label for="servicedata--provider-workforce-planning">Provider Workforce Planning<input type="checkbox" name="fields[services][]" id="servicedata--provider-workforce-planning" value="89193"><span class="checkmark"></span></label>
<label for="servicedata--service-line-strategy">Service Line Strategy<input type="checkbox" name="fields[services][]" id="servicedata--service-line-strategy" value="61"><span class="checkmark"></span></label>
</div>
<div class="col-sm-6 col-md-4 checkbox-parent">
<label class="label-head" for="servicedata--finance">Finance<input type="checkbox" name="fields[services][]" id="servicedata--finance" value="8"><span class="checkmark"></span></label>
<label for="servicedata--financial-advisory-services">Financial Advisory Services<input type="checkbox" name="fields[services][]" id="servicedata--financial-advisory-services" value="66"><span class="checkmark"></span></label>
<label for="servicedata--industry-benchmarking">Industry Benchmarking<input type="checkbox" name="fields[services][]" id="servicedata--industry-benchmarking" value="71"><span class="checkmark"></span></label>
<label for="servicedata--payer-contracting-reimbursement">Payer Contracting <span class="amp">&</span> Reimbursement<input type="checkbox" name="fields[services][]" id="servicedata--payer-contracting-reimbursement" value="67"><span
class="checkmark"></span></label>
<label for="servicedata--provider-compensation">Provider Compensation Planning<input type="checkbox" name="fields[services][]" id="servicedata--provider-compensation" value="68"><span class="checkmark"></span></label>
<label for="servicedata--valuation-services">Valuation Services<input type="checkbox" name="fields[services][]" id="servicedata--valuation-services" value="70"><span class="checkmark"></span></label>
</div>
<div class="col-sm-6 col-md-4 checkbox-parent p-0">
<label class="label-head" for="servicedata--performance-transformation-1">Performance Transformation<input type="checkbox" name="fields[services][]" id="servicedata--performance-transformation-1" value="9"><span
class="checkmark"></span></label>
<div class="col-sm-12 col-md-12 p-0">
<label for="servicedata--acute-care-performance-improvement">Acute Care Performance Improvement<input type="checkbox" name="fields[services][]" id="servicedata--acute-care-performance-improvement" value="87902"><span
class="checkmark"></span></label>
<label for="servicedata--ambulatory-service-line-performance-improvement">Ambulatory <span class="amp">&</span> Service Line Performance Improvement<input type="checkbox" name="fields[services][]"
id="servicedata--ambulatory-service-line-performance-improvement" value="72"><span class="checkmark"></span></label>
<label for="servicedata--consumer-engagement-access-to-care">Consumer Engagement <span class="amp">&</span> Access to Care<input type="checkbox" name="fields[services][]" id="servicedata--consumer-engagement-access-to-care"
value="74"><span class="checkmark"></span></label>
<label for="servicedata--digital-health">Digital Health<input type="checkbox" name="fields[services][]" id="servicedata--digital-health" value="88719"><span class="checkmark"></span></label>
<label for="servicedata--it-strategy">IT Strategy<input type="checkbox" name="fields[services][]" id="servicedata--it-strategy" value="79"><span class="checkmark"></span></label>
<label for="servicedata--medical-group-performance-improvement">Medical Group Performance Improvement<input type="checkbox" name="fields[services][]" id="servicedata--medical-group-performance-improvement" value="87910"><span
class="checkmark"></span></label>
<label for="servicedata--revenue-cycle-opt">Revenue Cycle Optimization<input type="checkbox" name="fields[services][]" id="servicedata--revenue-cycle-opt" value="69"><span class="checkmark"></span></label>
</div>
</div>
</div>
<hr>
<div class="addcomment-part">
<h4 class="checkbox-head">Add a comment?</h4>
<div class="form-group row">
<div class="col-sm-12">
<textarea class="form-control noresize" name="fields[comments]"></textarea>
</div>
</div>
</div>
<hr>
<div class="form-group row">
<div class="col-sm-12 contact-footer">
<div class="not-robot">
<label>
<div class="g-recaptcha" data-sitekey="6Lc0Y8MUAAAAAFmSfp-lRcLBxYPCcPJxX9AgQLAw">
<div style="width: 304px; height: 78px;">
<div><iframe title="reCAPTCHA"
src="https://www.google.com/recaptcha/api2/anchor?ar=1&k=6Lc0Y8MUAAAAAFmSfp-lRcLBxYPCcPJxX9AgQLAw&co=aHR0cHM6Ly93d3cuZWNnbWMuY29tOjQ0Mw..&hl=de&v=wxAi4AKLXL2kBAvXqI4XLSWS&size=normal&cb=h0yb9sl1y1z3"
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</div>
<input type="hidden" class="hiddenRecaptcha required" name="hiddenRecaptcha" id="hiddenRecaptcha">
</label>
</div>
<button type="submit" id="contact_submit" name="submit" class="btn btn-default submit-btn"><img src="//www.ecgmc.com/assets/images/newstyle/arrow-right.svg" alt="">SEND</button>
</div>
</div>
</div>
</form>GET https://www.ecgmc.com/search
<form class="search-form" action="https://www.ecgmc.com/search" method="get">
<div class="input-group">
<input type="search" name="q" class="form-control search-input" placeholder="Search ECGMC">
<img class="search-click" src="//www.ecgmc.com/assets/images/newstyle/search-iconsvg.svg" alt="">
</div>
</form>GET https://marketing.ecgmc.com/acton/eform/10977/0019/d-ext-0001
<form action="https://marketing.ecgmc.com/acton/eform/10977/0019/d-ext-0001" method="GET" class="form form__basic" id="js-form-newsletter" novalidate="novalidate">
<div class="form--group">
<div class="row row--two-up">
<div class="col">
<label class="required" for="First Name" aria-required="true">First Name</label>
<input type="text" name="First Name" required="" aria-required="true">
</div>
<div class="col">
<label class="required" for="Last Name" aria-required="true">Last Name</label>
<input type="text" name="Last Name" required="" aria-required="true">
</div>
</div>
<div class="row row--two-up">
<div class="col">
<label class="required" for="Company" aria-required="true">Organization</label>
<input type="text" name="Company" required="" aria-required="true">
</div>
<div class="col">
<label class="required" for="E-mail Address" aria-required="true">Email Address</label>
<input type="text" name="E-mail Address" required="" aria-required="true">
</div>
</div>
<div class="row">
<p>Choose All That Apply</p>
<ul>
<li>
<input type="checkbox" id="Newsletter" name="Newsletter">
<label for="Newsletter"><em>Healthcare Management Insider</em>, ECG's monthly email publication</label>
</li>
<li>
<input type="checkbox" id="Articles" name="Articles">
<label for="Articles">Articles</label>
</li>
<li>
<input type="checkbox" id="Upcoming Events" name="Upcoming Events">
<label for="Upcoming Events">Upcoming Events</label>
</li>
</ul>
</div>
<div class="row">
<button type="submit"> Submit </button>
</div>
</div>
</form>Text Content
* Services
STRATEGY
* Enterprise Strategy
* Facility & Capital Asset Planning
* Mergers, Acquisitions, & Partnerships
* Physician Alignment & Network Development
* Provider Workforce Planning
* Service Line Strategy
FINANCE
* Financial Advisory Services
* Industry Benchmarking
* Payer Contracting & Reimbursement
* Provider Compensation Planning
* Valuation Services
PERFORMANCE TRANSFORMATION
* Acute Care Performance Improvement
* Ambulatory & Service Line Performance Improvement
* Consumer Engagement & Access to Care
* Digital Health
* IT Strategy
* Medical Group Performance Improvement
* Revenue Cycle Optimization
* Tools
FEATURED SURVEYS
PHYSICIAN AND APP COMPENSATION SURVEY
ECG MANAGEMENT CONSULTANTS CONTINUES TO EXPAND ITS SURVEYS TO INCLUDE
INDEPENDENT, INTEGRATED, AND ACADEMIC PROVIDER ...
There is no more rigorous or accurate benchmarking resource for provider
compensation planning. Our surveys offer market-specific data composed of
compensation, production, and benefits information ...
Learn More
PEDIATRIC SUBSPECIALTY PHYSICIAN AND APP COMPENSATION SURVEY
THE INDUSTRY’S ONLY COMPENSATION SURVEY DEDICATED TO UNDERSTANDING THE UNIQUE
DATA NEEDS OF THE PEDIATRIC MARKET.
The industry’s only compensation survey dedicated to understanding the unique
data needs of the pediatric market. Our survey provides an in-depth review of
pediatric subspecialty market trends, ...
Learn More
FACULTY PHYSICIAN AND APP COMPENSATION SURVEY
OUR FACULTY PHYSICIAN AND APP COMPENSATION SURVEY SPECIFICALLY ADDRESSES THE
DATA NEEDS OF OUR ACADEMIC PARTNERS IN ORDER TO ...
There is no more rigorous or accurate benchmarking resource for academic
provider compensation planning.Our faculty survey offers market-specific
compensation, production, and benefits information ...
Learn More
ECG SURVEYS
* Physician and APP Compensation Survey
* Pediatric Subspecialty Physician and APP Compensation Survey
* Faculty Physician and APP Compensation Survey
* Medical Group Performance Survey
* Value-Based Contracting and Physician Compensation Survey
* Physician Benefits and Perquisites Survey
* Clients
CASE STUDIES SEE ALL
Case Studies
BEHAVIORAL HEALTH STRATEGY AND CRISIS CENTER DEVELOPMENT
Dignity Health–St. Rose Dominican Hospitals (DH-SRDH) engaged ECG as an
advisory partner to support ongoing efforts to identify, evaluate, and design
care workflows for behavioral
Case Studies
IMPROVING BUSINESS OPERATIONS PROCESSES
In the process of addressing operational issues, ECG enabled Easterseals
Northern California (ESNorCal), then known as Easterseals Bay Area, to
transform its process improvement
WHO WE WORK WITH
* Health Systems
* Physicians
* Children's Hospitals
* Academic Medical Centers
* Ambulatory Surgery Centers
* Payers
SERVICE LINES
* Behavioral Health
* Cardiovascular
* Children's Health
* Neuroscience
* Oncology Consulting Services
* Orthopedics
* Primary Care Consulting Services
* Women's Services
* Thought Leadership
ARTICLES SEE ALL
Articles
HOW RETAIL PARTNERSHIPS CAN IMPROVE HEALTH EQUITY AND ACCESS TO CARE
A retail partnership strategy can help healthcare organizations expand access
while addressing changing consumer expectations about care delivery.
BLOG SEE ALL
Blog
THREE WAYS HEALTH SYSTEMS CAN IMPROVE PERFORMANCE WHILE BUILDING SCALE
With the Biden administration taking aim at hospital consolidation in a
recent executive order, health systems need to focus on improving performance
as they grow in size.
UPCOMING EVENTS SEE ALL
16
Sep
REGULATORY ENVIRONMENT: RECENT CASES, ENFORCEMENT THEMES AND KEY TAKEAWAYS
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Thought Leadership
Blog Post
September 9, 2021
THREE WAYS HEALTH SYSTEMS CAN IMPROVE PERFORMANCE WHILE BUILDING SCALE
AUTHORS
* John
Fink
* Alfredo
Fernandez-Concha
The Biden administration’s Executive Order on Promoting Competition in the
American Economy calls for the Department of Justice and Federal Trade
Commission to “enforce the antitrust laws vigorously and recognizes that the law
allows them to challenge prior bad mergers that past Administrations did not
previously challenge.” It notes that “hospital mergers can be harmful to
patients and encourages the Justice Department and FTC to review and revise
their merger guidelines to ensure patients are not harmed by such mergers.”
Statements like that might hit close to home for some hospital executives.
Health systems have been aggregating into regional, superregional, and national
systems predicated on a strategy of gaining economies of scale, enhancing
services, and improving access. However, in few instances have these systems
elevated the performance of their individual hospitals or returned the benefits
of scale to consumers in terms of lower costs.
But it doesn’t have to be this way. And health systems—especially very large
health systems—are now equipped to transfer the benefits of consolidation to
patients, communities, employers, and payers. The question is, will they?
Scale can bring value to health systems and the communities they serve. Scale is
needed to achieve a level of market indispensability characterized by an
integrated provider network able to invest in data analytics, bear risk, and
offer patient-friendly physical and virtual care settings. But size—or,
scale—doesn’t guarantee relevance. Bigger doesn’t result in better. Only those
health systems that grow by strategically pursuing vertical integration into
asset-light delivery mechanisms and ensuring a deliberate and structured
approach to achieve system performance will be positioned for clinical and
financial success that results in consumer benefit.
Below are three core strategies to pursue to build scale and improve
performance.
1. SCALE VERTICALLY TO ADVANCE HEALTH—AND WELLNESS
Big health systems need to get bigger so they can put big data to big uses. Many
of the most useful applications of the data health systems are gathering require
a comprehensive network of care. And the more comprehensive the network, the
more robust the data. This data can empower health systems to not only
understand their patients when they are sick but offer insight into the general
well-being of the populations they serve. Vertical integration offers that
ability.
Broadening a health system’s perspective of vertical integration allows for
management of an even greater portion of a community’s health and well-being.
Health systems with a patient-centric focus and a population-based care model
will achieve a competitive advantage when applying data. A health system seeking
to develop lifelong relationships with its customers must first make sure it is
filling all its service gaps so patients don’t need to look elsewhere for care.
So, ensuring a comprehensive healthcare delivery system with superior customer
satisfaction and convenient physical and digital touch points is task one. But
why stop there?
Rather than limiting the health system to the traditional continuum of care and
those services reimbursed by traditional payers, consider moving to a continuum
of life where the health system’s role is to partner with customers in achieving
and maintaining health and wellness.
New revenue sources with higher margin potential than the health system’s core
business become apparent when the health system considers itself part of the $14
billion workplace wellness industry, $30 billion health club industry, and $120
billion wellness real estate industry. This expansion of the scope of
services—provided either directly or through affiliations—allows a health system
to fortify its relationship with consumers through more consistent contact while
achieving profitable growth.
2. INVEST IN ASSET-LIGHT SERVICES
Owning stuff isn’t what it once was. Ten years ago, companies from asset-heavy
industries such as energy, mining, manufacturing, and retail were ranked among
the 10 largest publicly traded companies. Today’s highly valued firms are
asset-light companies—firms in technology and finance. These firms generate
revenue while owning relatively few fixed assets; that is, they have a high
fixed-asset turnover ratio (revenue divided by net fixed assets). Among the
companies with the highest fixed-asset turnover ratios are health insurers.
Asset-heavy businesses have high fixed costs and require consolidation to build
market scale and high degrees of efficiency to drive return on assets. In
contrast, asset-light businesses have low fixed costs and derive their return on
assets from broad, efficient distribution networks and high utilization.
Health systems are burdened by big buildings filled with expensive equipment.
Although those big buildings need to be maintained, health system investments
should be focused away from bricks and mortar and toward the delivery of
ambulatory care, virtual services, and other asset-light sectors that broaden
their health and wellness care services.
3. ACHIEVE SYSTEM PERFORMANCE
Multiregional and national health systems are working to function more as
operating companies and less as holding companies. The challenges are great,
and, in many cases, leadership of these health systems should be commended for
their progress.
Consider the following five guiding principles when pursuing system performance:
* Don’t look for scale to create performance.Achieve performance and then scale
by integrating new organizations and new growth into your high-performing
business. Health systems are currently experiencing record-low operating
margins and face a growing proportion of care reimbursed below the cost of
providing it. Those that cannot enhance the value they provide will fade away
or be absorbed into those that can.
* Engage physician leadership to drive systemwide reduction in care
variation.The nation’s best-performing hospitals are those with a high degree
of physician leadership, where physicians have a strong voice in operations,
and administration is seen as an enabler of the improvements physicians seek
rather than a barrier. Physicians need to be empowered with timely cost,
quality, and outcomes data that can support consensus-building and guide
decision-making.
* Optimize centralized shared services.Standard, nonstrategic functions such as
revenue cycle, patient contact centers, supply chain, finance, legal, HR, and
IT should be managed at a system level. The nuts and bolts of operating the
health system must be optimized, and organizations added to the system need
to be effectively integrated.
* Establish an effective consolidation strategy.Define the one core objective
driving your consolidation strategy, and then measure every opportunity on
its support of that objective.
* Align culture, strategy, and brand. System performance is contingent on the
system having a unifying culture—not one culture for the hospital, a second
culture for the medical group, and separate cultures at different facilities
or regions. And this singular culture must complement the system’s branding.
When culture, strategy, and brand are aligned, all stakeholders understand
the health system’s purpose, and that purpose guides all behaviors,
decisions, and interactions.
Is Your Organization positioned for clinical, financial, and patient success?
This blog post is excerpted from part three of our We Believe series, a
collection of strategic perspectives on the changing dynamics of the US
healthcare system.
Read the Whitepaper
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