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Health System

What is a health system?

A health system is an organization of institutions, people, and resources that provides healthcare services. However, what falls within this category can vary based on different definitions.

For example, the Dartmouth College Center of Excellence states that a health system must comprise at least one hospital and one or more physician groups, and the physician group(s) must include at least three primary care physicians.

The RAND Center of Excellence defines a health system as two or more healthcare organizations affiliated through shared ownership or a contracting relationship for payment and service delivery. Additionally, the health system must include at least one physician organization and one acute care hospital.

Some clear similarities exist across these definitions. The health system must consist of at least one hospital and one physician group, and there is an affiliation between healthcare organizations in the health system.

Health systems are closely linked to integrated delivery networks (IDNs). An IDN is a health system that aims to integrate care across organizations and fragmented systems. IDNs provide a continuum of services across the patient journey and care transitions.

Some IDNs are localized in one geographic area, while others span the country. These networks are becoming more prevalent in the U.S. healthcare landscape and have the potential to influence physician treatment behavior. 

How does a health system improve healthcare?

Health systems provide consistent and seamless experiences for patients across all organizations and physicians.

A health system carries out four critical functions, and they include:

  • Resource generation
  • Provision of healthcare services
  • Stewardship
  • Financing

Through these actions, health systems provide patients with equitable access to healthcare while also promoting and improving health for all.