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Four takeaways on strategic planning for health systems

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WorkforceGrowth
Relevant Roles:
Chief Transformation Officers Chief Learning Officers Chief Information OfficersChief Human Resource Officers Chief Operation OfficersChief Strategy Officers

Against a backdrop of rapid federal policy shifts and turbulent markets, strategic planning is a hot topic in health system C-suites. To gain insight on market trends, pressures, and priorities, THMA’s Strategy Catalyst team analyzed 12 strategic plans of leading health systems. Here are a few of the key takeaways.

1. Service line expansion is cited as a top growth priority

  • Nearly all health system strategic plans emphasize revenue growth and diversification, with about two-thirds prioritizing service line expansion.

  • Women’s health is a top focus. Based on the live webinar discussion and our own market research, several factors seem to be driving this, including: women’s role in driving family healthcare choices, consistent service demand, broad specialty care opportunities, and payer incentives such as bundled maternity payments and maternal health initiatives.

2. Systems’ planning timeframes vary based on their goals

  • Health systems show mixed shifts in planning cycles: 43% report no change, 39% are shortening timelines for responsiveness, and 17% are lengthening them for transformational goals. Some moved from a 3-year to a 5+ year cycle to match ambitious objectives.

  • Many systems use hybrid approaches, such as rolling 3-year plans linked to 5-year financial plans. Other’s favor flexible horizons like “now, near, and far.”

  • Timeframes vary widely, with most plans starting in 2025 on 5–10-year horizons; however, some are setting bold 20-year goals for major institutional transformation.

3. Culture transformation is widely prioritized but underfunded compared to recruitment/retention and physician alignment

  • 83% of strategic plans cite culture as the top workforce priority, yet recruitment and retention is the top workforce investment for 79% of systems.

  • Culture change is diffuse and long-term, while physician alignment and retention are seen as urgent and budgetable.

  • Few systems define measurable culture outcomes (e.g., representation, turnover, internal promotions).

  • The challenge: translating nebulous, long-term goals into near-term, fundable investments.

4. Strategic growth into new markets can diversify policy risks

  • About half of health system plans prioritize market expansion, often to reduce exposure to state-level policy risks like Medicaid changes, telehealth licensure, and reproductive care restrictions.

  • Multi-state growth offers risk diversification but brings tradeoffs, including regulatory complexity, resource strain, and costly capital investments in M\&A or new facilities.

As workforce and financial pressures tighten, health systems are entering a period where the pace of change sometimes outstrips the comfort of traditional planning cycles. The variety of approaches makes clear there is no one-size-fits-all model for strategic planning. Still, every system can draw insight from how peers are tackling similar pressures, and adapt those lessons to their own context.