Stand-alone hospitals have neither the number of patients to manage the actuarial risk of population management, nor the geographic coverage to serve a large population. Hence the reason for allowing strategic hospital mergers.
Population health management means services must be coordinated so that primary-care physicians, specialists and hospital departments work together with all caregivers familiar with a patient's unique needs and status. This requires hospital systems to provide a full suite of services for their patient populations, warranting expansion through acquisitions of other hospitals, as well as physician medical practices and outpatient clinics.
Hospitals will also need to track patient conditions and treatments through sophisticated electronic medical records, which requires major technology investments. Additionally, hospitals must add an army of care coordinators to serve as the backbone of an integrated-care team. These are expensive investments that large hospital systems can bear far more readily than stand-alone facilities.
