Hospitals must help create new community networks

  Health-system markets are being pushed toward a volume vs. value-payment tipping point. This is driven by the confluence of states’ moving Medicaid and state-employee health benefits to value-based (risk) contracts, corporations’  securing national contracts for high-cost care episodes and commercial payers’ creating tiered health insurance. Successful population-health (value-payment) programs, whether fixed-price bundled services for individual patients or comprehensive services for a specific population, as with ACO’s, require action based on these insights:

  • Outcomes depend on patients’ behaviors over their lifetimes. Thus, patient and family participation must be increased. Success depends on getting “upstream” of medical-care needs.


  • Broad local and regional communities, not individual institutions, can best allocate resources to improve the social determinants of health.

Indeed, improving community health depends more on the interactions among the parts than on individually optimizing the parts themselves. Hospitals and health systems have a time-limited opportunity to help develop community-health networks, the backbone organizations for improving population health.

To get started, leaders of hospitals, public- and private-sector social-service organizations, payers and representatives of the broader community must first frame the discussion from a policy perspective and then map linkages across the community.

Our experience with community health networks underscores the importance of social determinants of health, teamwork within/across collaborating organizations and accepting risk within global budgets. Sustained system thinking across the community’s health assets, shared insights, and much generosity and patience from every sector are critical factors for success and flow from visionary hospital leadership and community/political leaders. Case studies from Oregon and Connecticut, among others, show what can be done.

To get started, leaders would do well to convene a perspective-and-policy-setting discussion to frame context and mutual dependencies. Complex, foundational change is emotionally and organizationally disruptive. Thus establishing a fact-driven and respectful dialogue is an essential first step. We recommend that community leaders, especially hospital leaders, convene a community conversation and use linkage mapping as way to structure the conversation for progress. Based on readiness, one or more work streams would be selected to explore and improve the interactions between the parts.


This  is a summary of an Oct. 13 presentation developed by a Cambridge Management Group team led by Marc Pierson, M.D., Annie Merkle and Bob Harrington for the Society for Healthcare Strategy & Market Development's Connections conference. Oregon State Sen. Alan Bates, D.O., provided invaluable information and insights from his work as both a primary-care physician and community/political leader enlisting colleagues in all sectors.