New Growth Metrics for Healthcare Systems in 2024

Title image for the blog on Healthcare growth strategies

Over the past few decades, the environment for healthcare systems has been changing quite dynamically. Key performance indicators from earlier years, including inpatient volume proportion, are no longer sufficient. Hospitals and health systems are now moving to more pro-active and value-based healthcare growth strategies that consider patient value, cost containment, and strategic partnerships. This transition is strategic for managing the problems that the pandemic, inflation, and market shifts present to businesses.

The Shift from Traditional Metrics to Value-Based Care

The measure of success in health care over the last five years has gone through tremendous shifts. Growth is still important but its nature is different now for the executive teams. Quite a number of nonprofit health systems are still struggling to break even, it being a tough financial year due to the impacts of the pandemic and inflation. During this recovery, a change to value-based care emerged as one of the major reforms.

In value-based care models, the focus is on achieving better patient outcomes while reducing costs. This transition is moving care from the hospital-based care to ambulatory and telehealth models of care. For instance, many large hospitals have adopted ‘hospital at home’ scenario in which patients require the services but they do not go to hospital.

Healthcare Growth Strategies for 2024

In 2024, health systems are using new strategies in their expansion plans based on organic and non-organic models. Kaufman, Hall & Associates noted that growth will be defined by factors such as the number of covered lives, control over healthcare expenditures, total cost of care and patient satisfaction.

1. Organic Growth Strategies

The strategy for growth among many hospitals is to extend their presence through new forms of service delivery and applications of technology. As they advance to the higher tiers of incentive or risk based payments, the health systems are creating new models of care delivery with cheaper yet quality results. These include:

  1. Expanding outpatient services: Health systems today are keen on developing clinic networks to cater for the patient need in the continuum of care away from a hospital care setting.
  2. Embracing telehealth and virtual care: Telemedicine has offered an opportunity for hospitals, to expand health care services’ reach to patients who would rather access health care services online.
  3. Hospital-at-home programs: The expanded use of home care as an alternative to inpatient hospitalization is proven to enhance satisfaction and reduce healthcare expense.

 

 

2. Non-Organic Growth Through Partnerships and Acquisitions

Gaining market share through non-organic activities is still a significant factor in healthcare systems’ objectives in 2024. Many executive teams are reevaluating their acquisition and partnership strategies, especially after a period of inactivity during the COVID-19 crises. This has been occasioned by the complementarity of capabilities required in modern delivery models, including technology, specialized services, and creative interventions.

  • Partnerships with specialty providers and startups: Outsourcing to specialists enables the health systems to offer additional services beyond the core without having to develop additional departments.
  • Payer-provider affiliations: These affiliations contribute to patient engagement and service acquisition, allowing healthcare entities to increase revenue and achieve better cost-effectiveness.

Addressing Talent Gaps Through Strategic Consolidation

Perhaps the least apparent cause of consolidation in healthcare industry is the shortage of talent. In the last four years, many hospitals have experienced a reduction in the strength of their leadership bench, as many employees leave their organizations. This has been encouraging merger and acquisition since the larger company seek a partner who can support its strength and the small and midsize company need stability and new growth.

Up-to-date sources also show that 20 hospital and system transactions occurred in the first quarter of 2024, the highest level since 2020. This elevated activity is common to all of them and points to a vigorous drive towards more consolidation to address talent shortages, market growth, and cost efficiencies.

Staffing from a talent marketplace like SkillGigs is another solution to overcome staffing challenges Many companies tend to marketplaces like SkillGigs where they can find top talent according to their needs

Reassessing Existing Service Lines for Long-Term Success

Health systems plan for the future,meaning they will review some of the service lines that are no longer sustainable in the long run. As the key link in the healthcare value chain of services, some senior living, outreach laboratories, and behavioral health services are examining whether partnerships instead of ownership are feasible for delivering these services. Such a shift preserves the accessibility of the services while at the same time providing medical care organizations with an opportunity to concentrate on other fundamental growth strategies.

The Road Ahead for Health Systems

These changes in growth metrics in the systems of health care are as result of the ongoing changes towards value-based system of care. The key issues of interest for successful organizations will be on patient satisfaction, cost reduction and containment in healthcare sector, and search for ways to organic and non-organic growth. The following strategies help system health organisations to operate within the emerging markets and realise consistent development: Outreach services, telemedicine, partnerships, and staffing.

As 2024 unfolds, the need for agility and adaptability will remain central to healthcare growth strategies. This means that health systems should look forward to a more integrated, patient-centered environment that rewards value rather than volume.

 

 

 

 

 

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