Move from extractive growth to productive growth

Insight 2 from the 2013 CEO Special Sessions

Facing price transparency on the pages on TIME Magazine, steep reimbursement cuts, and a dwindling number of unaffiliated physicians, hospitals can no longer depend on "extractive" growth strategies, or tactics that focus on consolidating local position, locking up referral streams, and demanding price increases.


 

At the same time, certain purchasers—especially activist employers, physician ACOs, and cost-conscious consumers—are becoming increasingly sophisticated, actively seeking high-quality, affordable, and convenient care options.

This is pushing hospitals into a new era of "productive" growth—earning market share by attracting empowered purchasers. Hospitals will fuel this new growth by figuring out how these groups actually make their decisions:

  • Network suppliers: Physicians, post-acute providers, capital partners, and other hospitals seeking partners in a turbulent marketplace.
  • Wholesale buyers: Risk-bearing entities such as commercial payers, employers, and physician ACOs purchasing care on behalf of broad populations of patients.
  • Clinical shoppers: Physicians and patients making decisions for individual episodes of care.