Case Study

Disaggregating a Market for Better Healthcare Strategy

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A sectioned orange against a white background illustrates the idea of disaggregating healthcare markets. Photo by Karolina Grabowska.

The Challenge: Finding pockets of opportunity for a nonprofit hospital in a diverse market served by better resourced competitors.

The Background: Ascendient was engaged by a local, acute care hospital that was affiliated via management agreement with a regional nonprofit health system. With several hundred beds and nearly $450 million in net patient revenue, our client was well run and well respected, but hardly the only game in town. One neighboring county was dominated by a teaching hospital five times the size of our client. In two other counties, though local hospitals were smaller, they were affiliated with regional or national systems that dwarfed our client’s affiliated system, as seen in the stylized "map" below.

Logically enough, our client’s existing strategy focused on 1) extending its leadership in its home county; 2) growing opportunistically in Submarkets 2 and 3, the neighboring counties with smaller local hospitals; and 3) defending against incursion by the teaching hospital in Submarket 4.

Our Work: Moving beyond the conventional wisdom on market conditions, we wanted to get a much more granular view on where patients were actually going for inpatient care, primary care, ED visits, ambulatory surgery, and a dozen specialized services ranging from oncology to orthopedics. Instead of relying on county-level data, our analysis looked service-by-service across scores of Zip Codes. In addition to current conditions, we overlaid demographic trends such as aging and population growth to see how and where service demand was likely to change over time.


The Findings: Within its home county, we found that our client enjoyed a leading position in primary care, urgent care, and surgery – both inpatient and ambulatory – all supported by a growing population and high levels of satisfaction. Radiation oncology stood out as the greatest opportunity in outpatient services, while Women and Children services were a major laggard on the inpatient side. 

Meanwhile, past investments in primary and specialty care for Submarkets 2 and 3 appeared to be working. In each of those smaller counties, a significant percentage of patients was choosing our client for tertiary care rather than the big teaching hospital. To build on that momentum, we identified several service lines that merited additional investment in Submarket 2, based on health needs and demographic trends. But in Submarket 3, despite the largest overlap in primary service area, we warned that a declining population plus changing competitive trends might call for a re-thinking of additional investments.

Finally, for Submarket 4, we found surprising opportunities for more aggressive growth. Our client had long ceded this market to its much larger competitor, but low satisfaction data for both patients and providers suggested that investing in new primary care and urgent care locations could repeat the successful growth scenario from Submarkets 2 and 3.


The Outcome: Despite deep-pocketed competitors on every side, our client realized that it had a real opportunity to expand regionally by increasing capacity and growing select service lines to match the needs in each county. Going back to the previous regional map, the client chose a specific competitive stance in each of its submarkets:

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