Competition in Health Care: Same Game, Different Rules

Added on Mar 31, 2015

Competition is good for health care—as long as the competition is driven by the “right” things. That’s the take-home message from Press Ganey’s 2015 Strategic Insights reportCompeting on Patient-Driven Value: The New Health Care Marketplace.

In most industries, competition drives value for consumers by improving quality and reducing the cost of goods and services over time. Historically, the U.S. health care industry has been an exception to the rule. This is not because health care is inherently different from other competitive industries or is somehow incapable of functioning in a similar manner. Rather, it is an outgrowth of the fee-for-service system that has incentivized providers to focus on volume vs. value, frustrating real marketplace competition.

In the continued evolution toward value-based care, hospitals and health systems must be prepared to compete efficiently on the clinical, safety and experience outcomes that matter to patients, according to Press Ganey Chief Medical Officer Dr. Thomas H. Lee. “Providers must constantly question how they are organized, what functions are most important to improve patients’ outcomes, whether those functions can be accomplished more efficiently, and if so, how?” Then, they must act on the answers in order to add value to the care they deliver.

Health care organizations that demonstrate value by rigorously measuring, transparently reporting and continuously improving the quality, safety and experience outcomes that matter to patients will be in the best position to build a sustainable competitive advantage.