Health systems, also referred to as integrated delivery networks (IDNs), are networks of providers and care facilities that are formed with the goal of improving clinical and quality performance. IDNs help to ensure patients see the best care outcomes for the lowest costs, and usually offer a full range of healthcare services from preventative to post-acute care. Each health system is different in terms of size, specialty, and membership makeup. According to Definitive Healthcare's database, approximately 77 percent of hospitals belong to an IDN, up from 75 percent in 2018.
Top 10 Health Systems by Net Patient Revenue (M)
HCA Healthcare: $39,776
CommonSpirit Health: $28,380
Ascension Health: $17,090
Providence St Joseph Health: $15,235
Tenet Healthcare: $13,598
Trinity Health: $13,095
University of California Health: $12,037
Dignity Health: $11,813
Community Health Systems: $10,861
Northwell Health: $8,993
Fig 1 Data from Definitive Healthcare based on reports from the Centers from Medicare and Medicaid Services (CMS). Net Patient Revenue listed in billions of U.S. dollars.
Large IDNs -- such as HCA Healthcare, Ascension, and others -- often act as group purchasing organizations (GPOs) for members, negotiating with vendors to receive lower prices for supplies and services. About 84 percent of active IDNs are affiliated with a GPO according to Definitive Healthcare, up from 80 percent this time in 2018. By understanding the pricing structures achieved by GPOs, an IDN may be able to further negotiate for its member facilities. Additionally, many IDNs service a local region, giving them a unique ability to identify the needs of a defined community and address pricing needs accordingly, in a way that nationwide IDNs or GPOs may be unable to match.
Collectively, the largest health systems manage more than 1,300 hospitals -- nearly 20 percent of active hospitals in the U.S. This could give these hospitals an advantage in lowering care costs. In addition to negotiating purchasing prices, health systems also help to keep patient referrals in-network. This improves care coordination, enhances the patient experience, and prevents revenue loss by referring outside of a hospital's network.
Top 10 Largest Health Systems by Member Hospitals
HCA Healthcare: 211
CommonSpirit Health: 202
Universal Health Services: 173
Department of Veterans Affairs: 161
Encompass Health Corporation: 134
Ascension Health: 124
Select Medical Corporation: 115
Community Health Systems: 111
LifePoint Health: 86
Tenet Healthcare: 84
Fig 2Data from Definitive Healthcare based on reports from the Centers for Medicare and Medicaid Services (CMS)
Health systems play a crucial role in bettering healthcare delivery throughout the U.S. IDNs are able to manage dozens of hospitals and other care facilities, expanding service offerings and providing specialty physicians and clinics to ensure patients are satisfied and treated properly. Because IDNs manage an entire network of facilities, they have the power to influence industry practices and set the bar for clinical and quality program performance.
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