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Strategic Options: It's Not ACO or Nothing

Mark DuBow, for HealthLeaders Media, September 2, 2011

The national dialogue surrounding accountable care organizations seems to include a barrage of discussion pieces around the pros, cons, and requirements of becoming an ACO. While an important consideration for many, it is critical to take into account a much broader spectrum of strategic options that lay before healthcare organizations even in this era of reform.

This is a critical time for organizations to distinguish between operational initiatives and strategic plans and update their strategic direction.

Keenly aware that just to survive they must be effective in delivering value-based care, many providers have been rushing to implement operational plans that address care redesign, electronic medical records, and various forms of clinical integration.

However, an organization that pursues those activities in the absence of having a clear definition of its strategic role to provide a framework for its transformation and future direction runs substantial risks.

A medium to long-range perspective on the transformation of the healthcare industry suggests that seven emerging strategic roles will exist. In addition to ACO, they include the following which we define as: low-cost leader, niche clinical service provider, research/innovation institute, island, virtual health organization, and vantage integrated provider.

An organization may be highly successful in any of those roles if it meets the associated critical success factors and the role is a good fit with the culture of the organization.

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