A health system may be defined in any number of ways, but at its core it represents a collection of affiliated providers offering services from physician visits to acute inpatient care. The structure of a health system both influences and derives from the services it offers. Understanding the differentiation of these services is crucial for various stakeholders in the healthcare industry. This paper illustrates an approach organizations may use for thinking about and quantifying a health system’s differentiation in its various markets.
Highlights
- Why measure service differentiation? We look at why measurement is crucial for health insurers, health systems, and policy watchdogs and regulators.
- Health system design features: We examine balancing substitutability and complementarity in market competition.
- The varieties of system composition: Using six health systems as examples, we present high-level statistics of the patient subpopulations and service compositions by major diagnostic category.
- Intrasystem composition: Differentiation can shed light on strategic and operational decisions made by each system that may influence patient access, care coordination, and competitive positioning.