2 approaches to increase market relevance

As non-traditional competitors enter the healthcare industry, hospitals and health systems must increase their market relevance, and take a hard look at what their organizations can do to boost ability to satisfy customer's needs, according to an article in Becker's Hospital Review.  

There are two different ways hospitals can expand their market space and relevance in it, and the approach a hospital or organization chooses is telling with regard to its respective mission, according to the article:

  1. Increase scarcity of the service by reducing the availability. Reducing availability eliminates consumers' choice and means hospitals can charge higher prices for their services. It also eliminates the need to play hospitals against each other for pricing or services by making it the only network available. However, because of non-traditional competitors in the healthcare market taking the most profitable segments of the population, hospitals are better off focusing on the second option, improving the value proposition.

  2. Increase the value of the product or service to the customer by improving cost, quality or service. To succeed in this arena, hospitals must be the low-cost, high-quality and best-service market leader, according to the article. Bringing healthcare components together under an accountable care organization or population health reimbursement model allow systems to rationalize out high-cost elements. Hospitals must improve quality, measure the improvement and convincingly communicate that improvement to the public. Finally, healthcare organizations must provide the best service to physicians and more convenient options for patients.

Ultimately, "health systems must reinvent themselves without losing their core strengths of care organization, long-term relationships and community trust," according to the article.

To learn more:
- here's the article