Predictions on Hospital Strategy in the Future: From Growth to Effectiveness, Relevance, and  Innovation, Talent, and Intellect

The healthcare delivery model is undergoing a massive change.  Everywhere hospital leadership teams are working to create new models and demonstrate care delivery effectiveness.  Strategic trends and increased interest in accountable care organizations, physician alignment models, operational efficiency, and uptick in mergers and acquisitions all indicate this shift.  This shift is not just about new reimbursement models. Even under the current fee-for-service model, Effectiveness strategies are playing a bigger role as Growth strategies are having less impact.

While the industry struggles to improve the delivery model Effectiveness, additional future strategic themes include one of the hospital and health systems’ Relevance.  Hospital and health system leaders will soon be faced with a question about the role of the hospital.  This question is being accelerated by the shifting importance of ambulatory and other elements of the continuum.

Historically, the hospital has played a leading role in organizing healthcare for the communities.  They have managed the scarce asset (infrastructure, technology, and complex operations) and served generally as the steward of the community’s healthcare.  However, the large, fixed inpatient assets and operations of the hospitals are becoming less of an asset as technology and information allows an increasing majority of healthcare to be delivered beyond the walls of the hospital.

This raises the question: In the future environment, is the hospital organization simply a manager of inpatient facility assets?

It is this question and its corollaries that lay at the heart of the hospital and health systems’ Relevance challenge.  We believe hospital and health system leaders must maintain the role of steward of the community’s healthcare coordination.  Without a strong non-profit organization taking that role, healthcare will quickly become less about caring for the community (patients) in favor of a focus on cost and the predictable result of payer defined rationing.

Other strategic themes emerge on the heels of the Relevance challenge.  For instance, how will hospitals lead and shape the industry to best organize healthcare unless they are successful at organizing, inspiring, and harnessing Innovation, Talent and Intellect? How will the future structures allow managing the continuum without Economic, Clinical, and Purpose Alignment?

Implications of Major Strategic Themes

Strategists focus on the interpreting and positioning for underlying industry themes rather than chase the tactical fads.  Understanding the underlying themes allows “no regret” strategies (strategies that work today and in the future) to be developed rather than strategies that “bet the farm” on the latest fads and unproven responses to a potential future environment.

The implication of the Effectiveness strategic theme is clear in the market today.  All around the country, Health System Advisors is advising leaders on responses to the Effectiveness requirement.  These responses include: positioning within an environment for greater accountability for care outcomes, preparing for bundled payments, clinically integrating various components of the continuum, consolidation, hospital-physician alignment, etc.  Moreover, the future strategic themes call us to challenge our client teams with questions about their Relevant role in future environments, how they will harness Innovation, Talent, and Intellect, while creating Economic, Clinical, and Purpose Alignment.

 


In the future environment, is the hospital organization simply a manager of inpatient facility assets?


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