As healthcare leaders across the country are focused on improving quality and the patient experience—while grappling with challenges that are transforming the practice of medicine—standalone hospitals and health systems are becoming increasingly rare. In order to remain strong in the new environment, many organizations are forming alliances with other providers, including clinical affiliations, regional collaborations, mergers, and acquisitions. Before pursuing these options, healthcare strategists must carefully evaluate potential partners with an objective, analytical approach that takes into account financial, clinical, operational, and market considerations.Introducing a 5-Step Partnership Ranking ToolIn 2014, Lafayette General Health (LGH), a Louisiana-based health system, developed and deployed a partnership ranking decision tool to support its long-range strategic business objectives. As a first step, the health system engaged Truven Health Analytics to evaluate the most recent and relevant data sources to provide insights on key competitors and potential partners in LGH’s primary and secondary service areas. LGH’s ranking tool includes these steps:
- STEP 1: Collect quality, financial, and market metrics for key competitors and potential partners.
- STEP 2: Interview key executives, physicians, and board members to gather their insights about potential partners.
- STEP 3: Organize the data into a spreadsheet tool and weight the importance of the metric categories.
- STEP 4: Ask leadership to rate the organizations by category.
- STEP 5: Calculate the rankings to guide management in partnership selection.
Erase the Boundaries of Business
In the 12 months following the strategic planning exercise, LGH partnered with four of the top five organizations identified by the ranking tool through a combination of acquisition, management, and clinical alignment affiliation agreements. These agreements have enabled the health system to expand inpatient bed capacity in Lafayette Parish by 128 beds and grow market share to over 60 percent.
Generate Data-Driven Insights
In the July/August 2016 issue of SHSMD’s Spectrum magazine, Allen Meadows, senior vice president of strategic planning and business development at LGH, and Joy Henderson, national director of planning solutions at Truven Health Analytics, share insights for creating an informed partnership strategy.
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