Rich Miller

Five strategic challenges—and solutions—for healthcare in 2023

December 05, 2022
By Rich Miller

For over a decade, healthcare systems have looked to mergers, acquisitions, consolidation, and diversification of services to ‘scale up’ operations. The aim is to achieve greater productivity and quality while simultaneously reducing costs. Unfortunately, for far too many health systems, these benefits have simply not materialized; in many cases, each of these measures has deteriorated. These challenges will persist until new methodologies and enterprise infrastructure are adopted to build high-functioning operating units and care settings that take full advantage of their talented and dedicated provider workforce.

Still, with the right approach, consolidation can yield an integrated health system that uses its diversity to enable care excellence. The key to doing so is to recognize that provider operations are the tool needed to execute health system consolidation—not the other way around.

With that idea in mind, here are five significant, strategic challenges the healthcare industry will face in 2023, along with some best practices for addressing each:

Challenge #1: Learn how to integrate, not just consolidate
The ongoing march toward consolidation has created a vast sea change around what healthcare organizations look like. Typically, health systems grow to try to improve care quality, productivity/access, and economies of scale. So, why does consolidation often result in the exact opposite of the intended consequences?

The answer is deceptively simple: Consolidation requires the integration of provider processes, and sufficient investment in tools to accomplish that task.

Overcoming this obstacle has as much to do with mindset as with practical tools. Most growing health systems try to “get through the consolidation” before turning their attention to their provider operations—but this approach has the tail wagging the dog. When health systems instead focus on coordinating, harmonizing, and integrating their provider operations, they often find that the resulting workflows solve many of their consolidation conundrums.

That’s because operational integration allows health systems to funnel individual providers to the moments of patient care where they can make the best and most efficient impact within the larger, consolidated network of care.

Challenge #2: Achieve economies of scale
Increasing efficiency and reducing costs while improving care quality will remain a sizable effort in the coming year. One way to do all three is to create clinical Centers of Excellence that let health systems scale up care quality and productivity while decreasing unit costs. It’s about centralizing certain services to reduce variability, which is costly to both clinical outcomes and financial operations.

For example, a health system might decide to perform all its knee replacement surgeries in one facility. Clinicians and staff then become such experts at those surgeries that they understand how to work efficiently and effectively. The health system not only reaps the benefits of activity-based costing but also enables highly specialized care teams.

We all know bright young people who don't command high salaries but are great learners and problem-solvers. Such talent can be incredible on a team of people who are dedicated to specific services. At a time when provider shortages are only expected to get worse, Centers of Excellence open opportunities to utilize less expensive but extensively trained staff.

Furthermore, the strategy works even for small, regional health systems. Any facility can generate a reputation for specialized care and slowly but surely attract more patients and become more dominant. After all, the size of a building says nothing about the quality of the care delivered inside it.

Challenge #3: Attract and retain providers and staff
Few health systems believe the current struggle to attract and retain providers and staff will disappear in the coming year. On the contrary, engaging high-quality, productive providers promises to remain a long-term challenge—and one that attractive salaries alone will not solve. Providers increasingly value health systems that decrease administrative burdens and support work-life balance.

These things can be accomplished in a couple of different ways. First, health systems can lean into the Centers of Excellence concept to give their skilled providers more predictability in how they work, including more consistent adherence to standards of care. Moreover, providers are likely to find it faster and easier to accomplish their administrative and clinical tasks when surrounded by other specialists focused on the same clinical mission.

Another way to satisfy providers and staff is by ensuring predictable, equitable, and flexible schedules. Advanced scheduling should act like an air traffic control system that allows health systems to schedule entire care teams (physicians, nurses, perioperative staff, etc.) vertically per care setting and horizontally across facilities in real-time. It also should be flexible enough to balance the needs of the entire enterprise with the needs of the individual facility and individual provider.

Challenge #4: Maximize clinical capacity
Maximizing clinical capacity could be the difference between health systems’ success and failure in the new healthcare economy that demands better access to care. No patient wants to wait weeks—or months—for care.

Although maximizing clinical capacity poses a daunting hurdle, it also offers a huge opportunity for health systems to examine how they coordinate provider and facility schedules. By leveraging platforms that link provider scheduling with room management, on-call, and credentialing, health systems can ensure that the right providers go to the right places at the correct times to maximize patients’ access to care.

A unified credentialing and scheduling platform can be particularly beneficial for maximizing patients’ access to care. Fusing these provider operations together ensures that providers and staff are only in the care settings for which they are credentialed, privileged, and available. Likewise, the moment a provider is credentialed, they should appear in the schedule to maximize their availability for patient appointments.

Challenge #5: Improve outcomes
For years, health systems have gathered provider data to drive evidence-based processes and protocols. That trend is sure to continue, but there is a danger: health systems can’t afford to concentrate so intently on data gathering and analysis that they fall short of putting the data into operational use.

Tons of high-grained data are generated as providers get credentialed, are scheduled, and go about their daily caregiving activities. Data offers excellent insight into who is doing what, where, and when—and the resulting clinical and financial ramifications. However, health systems must operationalize that insight if they hope to advance outcomes.

As the calendar flips to 2023, health systems nationwide will be challenged to integrate their services as an enterprise while preserving the local culture, practices, and autonomy that promote efficiency and effectiveness. However, those health systems that focus earnestly on provider operations will likely find it easier to build truly integrated teams that successfully improve outcomes across the enterprise.

About the author: Rich Miller is the chief innovation officer at QGenda.