Understanding hospital networks and affiliations can be the difference between having a successful sales conversation and wasting time talking to someone with no influence in the decision-making process. The constant stream of mergers and acquisitions in healthcare make sorting out facility and provider partnerships even more convoluted, reducing visibility into this high-value market.
Comprehensive knowledge of a health system or hospital network can help you pinpoint the specific problems of your prospective clients. Network and affiliations intelligence opens opportunities for comparing hospitals to others within their health systems, as well as comparing IDNs to one another – creating incentive for prospects to consider your unique solution.
We’ve compiled the three most influential metrics when analyzing affiliations between healthcare organizations and allied health professionals.
1. Hospital referral patterns
Hospital referral patterns can indicate a wide variety of provider pain points – the largest being network leakage. If clinicians in a hospital are consistently referring patients to out-of-network facilities and physicians, the original facility loses money. This can also lead to interruptions in care delivery and inconsistencies in care quality, which could negatively impact patient outcomes and cost even more money in penalties from the Centers for Medicare and Medicaid Services (CMS). Network leakage can also disrupt patient adherence to a medication regimen, further mitigating the effectiveness of a treatment plan and increasing care costs.
Referrals to specialists or specialized facilities may indicate a staffing shortage. If there are no providers offering a particular service in-network, there is little choice but to send a patient elsewhere. Identifying the diagnoses leading to the greatest number of referrals can help facilities understand where there are gaps in care within their network. For example, if a health system is losing patients with cardiac conditions to specialists in other networks, system leaders may consider hiring or contracting with cardiologists to reduce out-of-network referrals.
Fig 1 Image is a screenshot of DHC Visual Dashboard on Hospital Referral Patterns, from the Definitive Healthcare platform.
2. GPO and purchasing relationships
Who controls a health system’s purse strings? Hospitals and health systems that are members of a group purchasing organization (GPO) take advantage of lower supply costs. GPOs have massive purchasing power and can negotiate prices lower than retail costs for member facilities. Some IDNs have also begun to negotiate purchasing costs with vendors across the supply chain. Knowing which purchasing group(s) a hospital is part of can help you identify to which entities you should pitch your products.
According to Definitive Healthcare data, 91 percent of hospitals are members of a GPO, compared to 70 percent of health systems.
Some GPOs and IDNs are regional and serve facilities in specific geographies, while others have members nationwide. Contracting with a GPO is one way to secure a steady stream of sales to healthcare facilities. Additionally, finding influencers and champions for your services within a hospital or health system can put pressure on GPOs and other purchasing organizations to work with you. Hospitals and health systems are focused on cost-saving measures in an effort to meet CMS expectations for patient care costs relative to care outcomes. Physician preference items still account for a significant portion of supply chain spending – if you can prove ROI for your solutions, you become even more valuable to potential clients.
Fig 2 Image is from Definitive Healthcare’s comprehensive Hospitals and IDNs database. The map indicated locations of active GPOs in the U.S.
3. IDN parent and network hierarchy
According to Definitive Healthcare data, nearly 80 percent of hospitals are members of an IDN. These health systems dictate how hospitals and other member facilities run on a day-to-day basis. IDN membership also influences the software and other technology healthcare facilities implement (such as EHR vendors), supply chain spending, and quality improvement measures. Partnering with a health system can be more lucrative than focusing on one hospital alone and can ensure your services are adopted in dozens of care facilities.
Some IDNs even have parent IDNs. Of the 1,010 IDNs tracked by Definitive Healthcare, nearly 30 percent report having a parent IDN. Kaiser Permanente, a parent IDN, reports more than 540 members – including 5 smaller IDNs in California, Oregon, Washington, and Hawaii. When attempting to infiltrate care facilities in California, it could be more advantageous to target the Kaiser Permanente parent IDN than its member IDNs in northern and southern California – though these health systems could be good places to start, depending on the network hierarchies.
Fig 3 Image is from Definitive Healthcare’s comprehensive Hospitals and IDNs database. This map indicates the locations of IDNs in the U.S. by integration level.
Are you looking for more ways to improve your knowledge of the complex healthcare industry, including hospital affiliations and provider networks? Join us for a free webinar – Increasing Sales Efficiency and Deal Size by Understanding Provider Networks & Affiliations – on Wednesday, Oct. 30 at 2pm EST.
In this webinar, customer success manager Amanda Devaney will teach you how to:
Use data and analytics to identify patterns and interconnectivity among hospitals and other health facilities
Leverage referral patterns that provide visibility into provider networks
Identify buying teams within complex association relationships
Apply data-driven insights to contextual, relevant, and precise conversations with prospects