A way to approach the strategic decisions facing academic health centers

Rapid changes taking place in the various markets served by academic health centers (AHCs) are forcing these institutions to make difficult strategic decisions that may change AHCs' historic priorities. The authors present an approach that can help AHCs visualize possible new configurations of their traditional services of research, education, and clinical care. This approach is based on successful strategic management methods from the private sector and involves a three-dimensional "topography of services" encompassing all possible configurations of AHCs' services. From among the many possible configurations, the authors discuss three in detail. The historic one, which they call the traditional model, is characteristic of AHCs that give high priority to biomedical and clinical research, have broad medical education activities, and deliver comprehensive, high-quality clinical care. In the future, this configuration will be rare, and two others are likely to predominate. First is the "revised" traditional model, which would offer "boutique" clinical services, biomedical research, and medical education for MD-PhD students, residents, and fellows seeking tertiary care or academic careers. The patient care required for undergraduate medical education and clinical research would be provided by partnerships with community-based providers. Second is the academic services model, which would focus on competitive primary and secondary clinical services, health services and operations research, and primary care medical education. The authors discuss the implications of these models for AHCs' organizational structures and faculty incentives. They conclude that the clarity with which AHCs' strategic decisions are made and communicated to faculties and the incentive systems that are selected to motivate faculty and to provide the selected services may ultimately determine which institutions survive.