Five Key Components of an Optimal Organizational End State

Healthcare’s migration toward a value-centric payment system is disrupting “business as usual” for most organizations and provider groups.  Reform is recasting how care is provided and paid for.  To survive within the evolving healthcare landscape, hospitals and healthcare systems must effectively anticipate and respond to imminent change while simultaneously positioning themselves to achieve a more suitable end state that considers the sweeping changes to which we are all responding.

ECG defines the concept of a preferred end state as a clinically integrated network in which organizations and providers band together to follow common clinical protocols, monitor aligned measures and incentives based on improved value, and jointly pursue payor contracts.  Each organization is uniquely constituted, so long-term positioning strategies should be specifically tailored.  With that said, all positioning strategies geared toward realizing an optimal end state must factor in the five critical components that follow, regardless of organization’s size, scope, and scale:

  1. Primary Care (Physician) Alignment – Primary care needs to include the characteristics of a patient-centered medical home (PCMH).  Strong, suitable physician partnerships are critical to driving change and protecting short- and long-term market share.
  2. Care Delivery Transformation – Care delivery needs to be transformed through the design of systems of care that are built to create exceptional outcomes, with an emphasis on the utilization of evidence-based practices, patient engagement, seamless care transitions, and capacity optimization.
  3. Payor Contract Restructuring – Systems focused on efficiencies must renegotiate contracts to account for a shift in payor focus and improved value.  As utilization is taken out of the system, organizational and provider financial performance will be at risk if contracts are not restructured.
  4. IT Infrastructure Development – Hospitals and healthcare systems need to focus on creating an information-driven culture of integration and accountability through the development of an appropriate electronic infrastructure.
  5. Network Formation – Attention needs to be given to growing a clinically integrated delivery network of providers and sites of care.

ECG works closely with each client to realize its strategic vision by defining the organization’s ideal end state; identifying the core competencies and infrastructure required; evaluating the existing capabilities, culture, resources, and challenges; and designing a clear, deliberate road map toward short and long-term, goals.

To learn more about preferred end states, read the Insight on our Web site.

This entry was posted in Healthcare Reform, Network Development, Physician Alignment, Strategic Planning and tagged , , , , , , by Steve Messinger. Bookmark the permalink.

About Steve Messinger

Steve, who is Managing Partner of ECG, has extensive experience in strategic and business planning, business development, mergers and acquisitions, and managed care. He assists health systems, academic medical centers, and medical groups with developing and implementing strategies that drive competitive advantage, and he is an effective adviser to boards and executives who are managing the challenges and implications of transformational change. Steve has been a featured speaker on healthcare strategy and hospital/physician relationship issues for a variety of professional associations, trade groups, health systems, and physician groups. He has been published in several healthcare journals, including Modern Healthcare, Modern Physician, hfm (a publication of the Healthcare Financial Management Association), Group Practice Journal, and Health Care Strategic Management. He earned a master of health services administration degree from The George Washington University and a bachelor of science degree in clinical sciences from Cornell University.

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