• Hospital systems aren’t fulfilling the triple aim

    The recent paper by Lawton Burns and colleagues includes a very nice literature and conceptual review of the cost and price effects of hospital system size and configuration. It also includes a new analysis from which it concludes:

    One major finding is that membership in hospital systems is not associated with lower operating costs. A second major finding is that the lack of system effects has been fairly stable over time. Despite changes in information technology and vertical integration, most hospital systems have not improved their operating performance. The one exception is the slight deterioration in hospital costs observed among hospitals belonging to larger and national systems. […]

    Although system formation is not associated with costs, some systems exhibit lower costs than others. We find that hospitals in smaller systems have lower costs than hospitals in larger systems. […]

    For two decades, researchers and consultants have argued the dual advantages of organized systems—the ability to standardize functions and centralize governance and other activities—which can enable them to achieve the triple aim. Our research suggests that many hospital […] systems’ ability to contribute to lower cost health care is nonexistent or limited at best.


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