Healthcare Is A Finite Commodity: How Providers Can Differentiate Themselves

Jacob Kupietzky is President of HealthCare Transformation, a company dedicated to providing hospitals with experienced interim executives.

Medical workers with digital tablet in hospital


For decades, the U.S. has wrestled with a paradox within healthcare: We spend twice as much as comparable countries on health yet rank last among peers in health outcomes. A major question underpinning that dilemma is the nature of healthcare in this country: Is it a right of every citizen, and therefore, an expense that’s covered by the government, or is it a privilege exclusively for those wealthy enough to afford it?

More and more, it seems that healthcare isn’t so much a right or privilege as it is a commodity. As pointed out over a decade ago, healthcare is a finite resource: After all, “there are only so many doctors, hospitals, and, most important, money to go around.” In a commoditized market, healthcare facilities have to work harder to differentiate themselves.

So how can they do so? In an environment where patients are becoming more and more selective, how can healthcare providers differentiate themselves? While there is no one surefire answer for all facilities, there are some strategies they can take to stand out in a crowded healthcare marketplace.

Build up your network.

Gone are the days when hospitals need only stand there and patients sought them out. Now that consumers have a greater choice among healthcare providers, organizations have to consider what services they do and don’t provide. And with an increasing public demand for an all-in-one solution, that means establishing a network of service providers, clinics and local partners. This is especially significant in modern healthcare when patients no longer see the same doctor throughout their lives. A middle-aged woman will have different healthcare needs than her teenage athlete or her octogenarian father. Different systems, different specialties and different infrastructures will be needed to improve patients’ physical and mental outcomes.

Build up your brand and infrastructure.

Consider the facilities that would make up such an all-in-one solution: primary care offices, urgent care clinics, specialists, outpatient services. If all of these are to work together under the same healthcare brand, there needs to be a continuum of consistent care that patients can expect and ultimately rely on. That might start with instituting care standards across all facilities, but it would also mean establishing a means of sharing electronic medical records to allow for ease of scheduling, testing and communication among clinicians.

Consider the competitive landscape.

What choices do your community’s healthcare consumers have? Even if you provide a comprehensive network of services, is it best-in-class? People might buy store-brand detergent and paper plates, but in a healthcare emergency, they frequently go miles out of their way to consult with top specialists. How does your brand compare against your competitors in terms of availability, cost and (most importantly) health outcomes?

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Adapt on the fly.

Early in the pandemic, we saw patients put off much-needed care for fear of acquiring the virus during a hospital visit. While that fear was understandable, it hasn’t been durable, with healthcare facilities reporting patient volumes in October 2021 nearing 2019 levels. Even with the likelihood of new variants and subvariants, hospitals will need to develop capabilities, create new service lines and apply for designations without disrupting patients’ lives. Whatever changes your facility makes, it has to do so with the realization that the normal sequence of life doesn’t stop, and your consumers requiring cancer, orthopedic, oncology or other treatment won’t be able to wait until you’re ready.

Understand the needs of your community.

Start by figuring out what services lines you’re good at, and then see how they fit in with the needs of your area. Are you providing specialized services for a market that doesn’t need it or is already oversaturated? Consider finding a partner so you can close that unit and reallocate resources to what you are doingPay special attention to the needs of seniors; they are still a fast-growing demographic in the U.S. Pay more attention to women; women are not only the major deciders for healthcare needs, but they’re also using more healthcare services. Explore creating an end-to-end solution for these often underserved demographics.

The unfortunate truth is, in a commoditized market, you must be more than a healthcare provider. You must be a market researcher and brand manager. You must be strategic and thoughtful in how you grow; forming partnerships and affiliations, assessing your strengths and weaknesses, and most importantly, taking the time to understand the needs and preferences of the community you serve. In modern healthcare, that’s the best way for consumers to receive the best possible care and for hospitals to thrive.

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