Hospital and Health System Innovation and Transformation - McDermott

Key Takeaways: Hospital and Health System Innovation and Transformation at the 2023 J.P. Morgan Healthcare Conference


Leaders in health system innovation joined McDermott and EY at the 2023 J.P. Morgan Healthcare Conference to discuss how hospitals can address current financial and operational issues while also positioning their systems to compete in an evolving healthcare landscape. Panelists cited diversifying and digitizing healthcare access as a means of transforming health systems into more consumer-oriented healthcare companies.

Key Takeaways:

  1. Hospitals and health systems are looking to address the need for efficiency in healthcare delivery to become more productive and to provide better care.
  2. Attraction and retention of clinicians is top of mind for hospitals and health systems as they continue to navigate the post-COVID-19 landscape.
  3. To increase efficiency and quality of care, hospital and health system leaders are interested in strategic partnerships and joint ventures in new areas.


The need for health systems to create more diverse patient access points by deconstructing, digitizing and diversifying healthcare delivery was identified as a top priority. By adding “smart assistants” in patient portals, for example, patients can find answers themselves and be directed to appropriate resources within the health system, freeing providers to focus on the delivery of care. Among other benefits, investing in these initiatives can reduce provider workloads and alleviate workforce shortages.

In a similar vein, hospitals and health systems can drive efficiency by reimagining and reinventing themselves from health systems to health services companies. Artificial intelligence (AI) can also pave the way for health systems to provide services more effectively.

It is also important for health systems to rethink existing delivery models that focus exclusively on traditional hospital settings. By reallocating capital to joint ventures and partnerships, hospitals and health systems can shepherd in new capabilities and alleviate existing operational inefficiencies. Micro hospitals and freestanding emergency rooms (ERs), in particular, can address a variety of patient health needs in a more efficient, patient-friendly manner, with reduced capital and operational requirements than traditional care environments.

Other areas of opportunity include partnerships with home health companies and skilled nursing facilities, which can assist hospitals by preventing readmissions and alleviating ER capacity concerns. Hospitals and health systems typically utilize a long investment cycle when deciding how to allocate capital; these entities should rethink this process and focus on how investments today can facilitate a long-term, more sustainable health system.

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