John McleanOver recent years, the concept of “systemness” has emerged in healthcare to capture the need for health systems to operate as true systems in a coordinated, consistent, and consumer-friendly way. Systemness spans both how the health system handles internal operations— from referral routing and care coordination to physician engagement and IT deployments— and how it presents itself externally. Key considerations in the latter encompass everything from branding and communications to patient access and care transitions. 

Although the notion of systemness has always made conceptual sense for health systems, several key trends are propelling it as a priority today.

Mergers and Acquisitions

As healthcare delivery organizations combine operations and look to present a consistent brand experience to patients, providers, staff, and members of the broader community, the need for systemness has skyrocketed. With 2017 breaking records for health system transactions  (Kaufman Hall reports that there were 115 total and 11 involving sellers with net revenue of $1B and up) systemness initiatives need to take center stage. 

Without a deliberate strategy for systemness, health systems risk not maximizing the impact of their mergers and acquisitions. For example, there should be coordination around referral processes and visibility into the combined provider network to avoid referral leakage and missed patient acquisition opportunities. Similarly, patient loyalty may be at risk if a patient seeks care at a newly re-branded care site and is not satisfied with the experience.

Consumerism

Consumers are behaving more and more in health care like they do in other industries when it comes to decision making about where they’ll obtain services. And as their cost burden rises, their expectations follow suit, putting growing pressure on health systems to deliver differentiated and consistent levels of service, particularly those in competitive markets. Health systems are naturally placing focus on the patient experience, which starts with how patients access care and extends to how they make transitions within health systems. 

Systemness comes into play here especially as it relates to finding an in-network provider. Health systems should consider creating a comprehensive provider directory patients can search online. Similarly, for patients who prefer to call in, there should be a single number to dial. Call center agents, providers, and other staff should have the ability to search across the full network to find providers who best meet patients’ needs. Health systems should strive to make a good impression at the “front door” by making systemwide access easy for patients as their networks evolve.

Rapid Growth of Alternative Sites of Care

Healthcare consumerism has grown alongside a closely linked trend—the rapid growth of alternative sites of care. Research has shown that patients prioritize convenience and timely access; 82 percent of consumers cite appointment availability as extremely/very important in provider selection, and 77 percent cite location as extremely/very important. Thus, urgent care and retail clinics are increasing in popularity. CVS MinuteClinic alone reported 37 million patient visits in 2017 across its 1,100 locations in 33 states. Recognizing this trend, health systems across the country have partnered with organizations like CVS and Walgreens to expand and enhance patient access. 

Alongside expanded care site offerings come opportunities for building new patient relationships and brand loyalty. The need for systemness now expands far beyond to the walls of health system; health systems need to think about how they both provide access and present their brands across traditional and emerging settings. Atlanta-based Piedmont Healthcare for example, last year announced 27 retail clinics inside Walgreens stores.

Planning for Systemness

Systemness bears implications for health system patient acquisition, conversion, and retention,  all of which play critical roles in the financial performance of health systems. Mergers and acquisitions undoubtedly provide exciting opportunities for health systems to expand their reach, tap into new streams of revenue, and realize cost synergies. However, to capitalize fully on the short-term buzz and long-term business implications of such partnerships, while simultaneously meeting rising consumer expectations and demand for convenient access, health systems need a sound strategy for cultivating and reinforcing systemness. 


John McLean, is CFO, Kyruus, Boston. 

Publication Date: Thursday, July 26, 2018