Current Trends in Academic Health Systems: Four Things Boards Should Understand

Daniel DeBehnke, MD, The Governance Institute

Academic health systems (AHSs) are complex, matrixed organizations with a variety of ownership, governance, and operating models. However, the common thread that links them together is the commitment to multiple missions: delivery of clinical care to the communities they serve, educating the next generation of providers, and delivering innovation and discovery to advance health and medicine. As the healthcare sector undergoes transformational change, AHSs are facing significant headwinds. A recent report by Moody’s concluded that the unique, market-differentiating characteristics of AHSs give them inherent and fundamental credit quality, but these same characteristics put them at risk when competing in a value-based environment, where delivering on the Triple Aim (improving the health of populations, improving the patient experience, and reducing the per capita cost of healthcare) is paramount.

As AHSs navigate these choppy waters, board members must be well versed in the complexities of the changing environment so that they can appropriately exercise their duty of care in assisting management in planning and decision making.

There are several important questions that board members should be seeking answers to: 

  1. What is our strategy for delivering system-based integrated care? 
  2. How is our organization maximizing differentiation while delivering consumer-centric care? 
  3. What is our strategy to improve cost and quality (value)? 
  4. Are our missions linked strategically and financially? 

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