“The essence of strategy is choosing what not to do.” Michael Porter.
It is so often the case that organizations try to do things they should not do. Call it irrational exuberance; getting out in front of the curve; or a bridge too far. Hospital systems are examples of that. Already large, complex organizations doing incredibly challenging things with billions of dollars flowing through their systemic blood vessels, they are understandably tempted to do more. They always are. That is the inevitable urge of active hospital board members and ambitious executives. Do more; not do less. After all, who arrives to such an exalted position to do less?
Their collective corporate eye is cast toward health insurers who have been called bloated and inefficient; dinosaurs; dim witted at best. The President of the United States, no less, disparaged insurers while promoting the ACA, labelling them the “villains” of the healthcare system. Speaker Pelosi called them “immoral.” How difficult can it be to do health insurance better than the insurers have done it? Should be easy for people as smart as those who run complex healthcare delivery systems.
“Hospitals think this is a way to cut out the middle person, tailor care more closely and save a lot of extra money, but there’s a history to this and it generally doesn’t work,” said Howard Berliner, a visiting professor of health policy at NYU. “It sounds easy, but it winds up being incredibly complicated.”