by Eric Youmans

Created on: December 09, 2009

An often overlooked, but potentially vast reform of our current healthcare system could be done in the area of integration.  Proper integration and increased collaboration between clinics and providers could greatly decrease costs of administration, through the reduction and/or elimination of unnecessary paperwork, duplicated and excessive procedures, and redundant tests and exams.

This type of reform stresses the importance of streamlining patient care, through the application of concepts such as vertical integration.  Vertical integration involves merging all aspects of health care under the leadership or ownership of one entity.  This could involve a merger of hospitals and clinics that are all in the same region.  This type of integration has potential to be highly efficient since it allows for strategic management on a vast scale.  However, it takes a huge investment of capitol to accumulate several medical facilities and keep them well coordinated. 

Virtual integration seeks to emulate the benefits of vertical integration without the expenditures.  In this type of integration, different health care facilities act together in ways to maximize patient care and minimize business risk.  The disadvantage here is that no matter how comprehensive the agreements between separate health care entities, there will always be risk of duplicated, unnecessary administration at the point of patient care.   A vertically integrated continuum of care will always be potentially more seamless than a virtual integration.

Horizontal integration can be similar to either vertical integration or virtual integration.   Satellite facilities each cater to a different target group of patients.  For example, in a multi-hospital horizontal integration, there may be several hospitals in a particular region.  Each hospital may offer services that target a specific portion of the local inhabitants.  For example, a large city may have three major hospitals, A, B and C.  Hospital A is a rehabilitation and physical therapy facility.  Hospital B is a radiology and cancer center.  Hospital C is for long-term inpatient and hospice care.  This arrangement reduces competition between hospitals, ensures that they all can be profitable and highly functional, while offering a comprehensive spectrum of medical services to the city’s inhabitants.

In the raging healthcare debate, we should seek to epitomize the ideal concept of seamless continuum of care; and not get caught up in political fear mongering or scare tactics from those whose intentions are to maximize profits at the expense of quality.

Learn more about this author, Eric Youmans.
Click here to send this author comments or questions.