How Health Systems Can Survive the Retail Healthcare Squeeze
"We are in the golden age of consumerism in healthcare." That’s how Tom Swanson of Adobe characterized the shift in which patients behave more like consumers, seeking the same ease and satisfaction they find in other sectors, like retail and banking.
Swanson was one of the panelists at a recent Global Prairie virtual event: Surviving the Retail Healthcare Squeeze: Strategies for Health Systems. During this webinar, industry leaders explored how health systems can best adapt in the face of growing competition from retail giants and private equity-backed disruptors. In addition to Tom Swanson of Adobe, the panel featured insights from Tom Hileman of Global Prairie, and Rob Whitehouse of TriHealth. To share key insights from the panel, it is important to provide brief context about the challenges being faced by health systems. Traditional healthcare models are being disrupted by new entrants to the marketplace, including high-tech players like Amazon, the surge of retail care centers like CVS, the rise of virtual-first companies, and, finally, an explosion in private-equity acquisitions across the healthcare ecosystem.
Trust as a Competitive Advantage
The retail healthcare model is built on consumerism—offering patients the convenience and transparency they expect from other industries, such as retail and banking, but nothing is more important to consumers than trust. According to Global Prairie’s Tom Hileman, trust is a critical factor that health systems can leverage to differentiate themselves from retail disruptors. "Patients trust their doctors, nurses, and local health systems more than they trust payers or government entities," Hileman noted. This inherent trust provides a unique opportunity for traditional health systems to solidify their position in the market by building on the foundation of trusted relationships.
Strategies for Success
Health systems that have embraced the changing landscape, like TriHealth in Cincinnati, are finding ways to coexist with retail healthcare providers. Rob Whitehouse from TriHealth shared how they have partnered with Walgreens to run clinics, thus turning a potential competitor into an ally. "Instead of being defensive, we've leaned into these changes," Whitehouse shared. By aligning their services with population health models and maintaining a strong primary care network, TriHealth has managed to thrive in a competitive market.
The panel also discussed the need for health systems to clearly define their value proposition. Whether it's focusing on primary care, specialty care, or other areas, it's essential to communicate this value to patients effectively. As Tom Swanson pointed out, "Healthcare isn't completely a consumer environment, but the models we see in retail care—getting care where, when, and how you want it—are here to stay."
Looking Ahead
Our discussion underscored that while the retail healthcare squeeze presents significant challenges, it also offers opportunities for health systems to innovate and strengthen their ties to the communities they serve. The key is for health systems to remain agile, and consumer focused as the lines between retail and healthcare continue to blur.
The panelists agreed that those who can adapt to this new environment, leverage their trusted relationships, and clearly define their value in the market will not only survive but thrive.