Disruption, Consolidation, and the Race for Market Share

Published: April 24, 2025
Author: Greg Wahlstrom, MBA, HCM
Focus: Competitive positioning, consumerism, vertical integration, and strategic pivots to retain market share.

The Threat is Real—and Already Here

The U.S. healthcare landscape is undergoing a seismic shift as nontraditional players—Amazon, CVS Health, and Optum—reshape access, pricing, and consumer expectations. These retail giants have moved beyond pilot programs to full vertical integration, combining primary care, pharmacy, tech platforms, and insurance within unified ecosystems. According to a 2025 McKinsey report, Optum now manages care for over 120 million Americans, while Amazon’s One Medical footprint spans 37 states. CVS Health’s acquisition of Signify Health and Oak Street Health cemented its pivot from pharmacy chain to full-spectrum provider. Health systems can no longer afford to view these companies as external disruptors—they are now direct competitors. “If you don’t think you’re in competition with Amazon, you’ve already lost,” said Dr. David Feinberg, CEO of Cerner. The entry of tech and retail into healthcare has brought speed, capital, and consumer loyalty that traditional systems often lack. Therefore, competitive strategy must evolve now—not after market share is lost.

Traditional health systems face structural disadvantages in this new era: slow adoption cycles, legacy IT infrastructure, and fragmented service delivery. By contrast, Amazon and Optum offer seamless user experiences, 24/7 virtual access, and bundled pricing models that appeal to a generation of healthcare consumers raised on convenience. At CVS Health, the average primary care appointment is scheduled in under three minutes through mobile apps. Amazon Pharmacy delivers prescriptions in under two hours in major markets. These are not futuristic capabilities—they are current realities. In our article, “The Hospital of the Future”, we examined how digital-first hospitals are embracing design, automation, and consumer insight. But for many legacy systems, catch-up is no longer enough. Consequently, health systems must choose: differentiate with clarity or risk commoditization.

Executives must now act with urgency. Providence has launched its own telehealth-first subsidiary, DexCare, to compete on digital convenience and access. Northwell Health is building consumer loyalty through personalized health plans, retail clinics, and wellness subscriptions. These efforts show that health systems can respond—but they must lead with agility and innovation. “The enemy isn’t Amazon—it’s inertia,” said Dr. Toby Cosgrove, former CEO of Cleveland Clinic. System leaders must think like retailers, act like startups, and deliver like clinicians. Thus, the competition is not only external—it’s internal, between old habits and new expectations.

The Rise of Consumerism in Healthcare

Today’s patients are also customers—with expectations shaped by digital banking, e-commerce, and on-demand services. The healthcare industry, historically resistant to consumer-centric models, is now being forced to evolve or become obsolete. According to a 2024 Accenture survey, 78% of consumers said they would switch providers for better digital experiences, while 65% expected the same level of service from their health provider as they do from Amazon. Systems like Yale New Haven Health have begun mapping patient journeys and removing friction points from scheduling to billing. Similarly, Ochsner Health offers a real-time ratings system for physician encounters—turning feedback into instant improvement. “Healthcare isn’t just clinical—it’s experiential,” said Elizabeth Mitchell, CEO of Purchaser Business Group on Health. Thus, winning the future requires competing on service—not just on outcomes.

Experience design is now a core competency. Mass General Brigham and Sutter Health have created Chief Consumer Officer roles tasked with aligning operations around loyalty, ease, and trust. At The Healthcare Executive, we highlighted systems using net promoter scores (NPS), access-to-answer times, and app engagement rates as operational KPIs. These tools quantify experience—making it actionable. Even simple upgrades like mobile check-in, automated prescription renewals, and SMS follow-ups can radically improve retention. When systems demonstrate they value time, preferences, and transparency, they build durable loyalty. Consequently, consumerism is not a department—it’s a design principle.

Industry disruptors already understand this intuitively. Amazon’s health platform includes a unified app for virtual visits, labs, and pharmacy, with predictive notifications and personalized health nudges. CVS offers subscription-based wellness memberships, discounts, and care coordination in a single interface. These models are not just convenient—they are sticky. “Every click is a choice—and every delay is a departure,” said Dr. Sachin Jain, CEO of SCAN Health Plan. Therefore, competing on consumerism means rethinking care access, design, and communication as deeply as clinical quality.

Vertical Integration as Competitive Armor

One of the most powerful weapons used by disruptors is vertical integration—the consolidation of payer, provider, pharmacy, and tech under one brand and infrastructure. UnitedHealth Group’s Optum unit now owns physician groups, urgent care chains, health plans, and analytics platforms. This gives them control over cost, quality, and customer relationships across the full continuum. CVS Health’s acquisition of Aetna further cements their payer-provider-retail ecosystem. As noted in Health Affairs, vertically integrated models are now outperforming fragmented systems on price predictability and patient experience. “If you control the channel, you control the value,” said Ken Kaufman, chair of Kaufman Hall. Consequently, traditional health systems must evaluate where integration can offer leverage—without compromising mission or scale.

Some systems are fighting back with strategic partnerships and acquisitions. Northwell Health launched a joint venture with Walgreens to operate retail clinics and coordinate pharmacy benefits. Advocate Health (formerly Advocate Aurora and Atrium) is building an integrated care delivery and insurance network across six states. These alliances blur the lines between clinical care, financing, and consumer convenience. “Vertical integration is not about size—it’s about synergy,” said Dr. Bruce Siegel of America’s Essential Hospitals. Leaders must strategically decide what to own, what to outsource, and where to differentiate. Thus, integration is both a financial and philosophical decision.

Data is a key enabler of vertical integration. Disruptors leverage unified data architectures to personalize care, manage risk, and automate decisions at scale. In contrast, many hospital systems still operate with siloed EHRs, disconnected billing platforms, and opaque population health metrics. As explored in our AI in the C-Suite article, enterprise data strategy is now a CEO-level priority. Systems like Providence and Rush are investing in digital twins, predictive care journeys, and real-time resource planning. Therefore, vertical integration is not simply about ownership—it’s about orchestration.

Strategic Pivots That Actually Work

To compete with retail health giants, traditional systems must pivot with intention—not imitation. Chasing disruptors in their native territory (like mail-order pharmacy or same-day delivery) is unlikely to yield lasting advantage. Instead, systems must double down on their strengths—deep clinical networks, care complexity, and community trust. Cedars-Sinai has expanded specialty access via virtual second opinions and AI-assisted diagnostics. Mayo Clinic now licenses its digital expertise to health systems globally through the Mayo Clinic Platform. These strategies focus not on replicating Amazon—but on being irreplaceable. “Don’t beat Amazon at their game—change the rules,” said Dr. Stephen Klasko. Accordingly, strategy must be rooted in differentiation—not mimicry.

Cost innovation is another area ripe for bold pivots. Systems like OSF Healthcare and Baystate Health have launched fixed-price bundles for common procedures, bringing transparency to markets long plagued by billing confusion. Sutter Health is experimenting with health subscriptions for employers and consumers—creating predictable cost models. These programs increase competitiveness while strengthening trust. As outlined in “Cost, Value, and Growth”, price strategy is a vital part of brand strategy. Therefore, competing on affordability must become a leadership imperative—not just a compliance checkbox.

Clinical innovation also separates systems that adapt from those that decline. Trinity Health now integrates social determinants screening, predictive analytics, and home health in every discharge plan. OSF Healthcare built a virtual hospital to treat rural patients using remote monitoring and AI. These are not gimmicks—they are scalable, sustainable differentiators. “If you’re not innovating at the edges, you’re eroding at the core,” said Dr. Don Berwick. Thus, every strategic pivot must be both systemwide and grounded in patient need.

Culture and Leadership That Drive Market Advantage

Strategy begins in the boardroom—but lives in the culture. Competing with tech and retail requires not only new products, but new mindsets. Systems that cling to hierarchy, fear of failure, or legacy silos will struggle to attract innovation-ready talent. RWJBarnabas Health restructured its executive leadership to include chief experience, digital, and diversity officers reporting directly to the CEO. Main Line Health adopted “test and learn” funding for staff-driven pilot programs, with annual innovation summits open to all departments. “If you want enterprise agility, you must decentralize insight,” said Dr. Atul Gawande. Ultimately, winning markets starts with empowering people.

Talent strategy must also shift. Amazon and CVS can offer compensation, convenience, and brand recognition—but health systems offer meaning, growth, and mission. Leaders must articulate that value clearly and often. Children’s Hospital of Philadelphia includes mission storytelling in onboarding and weekly leadership briefings. Yale New Haven Health tracks manager trust scores and internal promotion rates alongside financial KPIs. As explored in “The Healthcare Workforce Crisis”, culture is now a strategic asset. Therefore, leaders must design it as deliberately as they design care pathways.

Resilience and adaptability are critical traits. In a disrupted environment, the ability to pivot, listen, and co-create is more valuable than top-down expertise. Northwell Health uses real-time sentiment analysis to adjust team strategy during system changes. Gundersen Health invites staff to co-author annual strategy documents. These practices build buy-in, reduce friction, and accelerate innovation. “People support what they help create,” said Peter Senge. Consequently, culture must become a competitive differentiator—not a compliance artifact.

Data, Platforms, and Ecosystem Leverage

The future of healthcare competition will be won on data—not size. Amazon, CVS, and Optum already leverage vast datasets to personalize care, manage population risk, and automate engagement. Traditional systems often struggle with fragmented data, non-interoperable EHRs, and analytic lags that limit insight. At Mount Sinai, enterprise data governance now operates under a C-level executive empowered to prioritize patient segmentation, loyalty prediction, and real-time quality signals. Rush is piloting digital twins to model patient flow, staffing needs, and financial risk—bringing platform-level thinking to operational design. “If your data strategy is reactive, your market strategy is irrelevant,” said Aneesh Chopra, former U.S. Chief Technology Officer. As such, health systems must treat data not just as IT— but as infrastructure.

Platform integration is a new differentiator. Disruptors don’t just connect tools—they unify experiences. Amazon integrates pharmacy, virtual visits, wearable devices, and insurance in one app. Optum combines behavioral, primary, specialty, and post-acute data into a seamless continuum. Hospital systems must develop similarly interoperable platforms or risk becoming disconnected vendors within someone else’s ecosystem. Providence launched its own care navigation platform across 10 states, centralizing referrals, diagnostics, and virtual check-ins. UCHealth is building a consumer-facing digital front door that includes triage AI, scheduling, and remote monitoring. These platforms function like retail ecosystems—designed around behavior, not bureaucracy. Thus, platform leverage is the digital equivalent of hospital real estate—and must be treated as such.

Healthcare ecosystems are also expanding beyond clinical encounters. CVS is integrating financial services, home delivery, and social determinants partnerships into its model. Amazon’s partnership with JPMorgan and Berkshire Hathaway signals broader employer-healthcare alignment. Traditional systems must rethink what value looks like—not just in a bed, but in a home, workplace, school, and screen. “Ecosystems outlast empires,” said John Sculley, former Apple CEO and health tech investor. To compete, systems must move from care networks to health ecosystems—interconnected, anticipatory, and omnipresent.

Rethinking Value Beyond Volume

Retail health disruptors are defining value as convenience, simplicity, and predictability. Traditional health systems have long equated value with volume and margin—metrics that may not translate to new consumer expectations. Systems must now quantify value through access, transparency, outcomes, and patient-perceived benefit. Cedars-Sinai tracks digital touchpoints per encounter to understand patient effort and satisfaction. Mayo Clinic links clinical outcomes to engagement rates and educational content usage. These shifts reflect a deeper understanding: value is no longer dictated—it’s experienced. “In the age of consumerism, value is felt more than it’s measured,” said Dr. Zubin Damania (ZDoggMD). Consequently, executives must redefine value across every channel of engagement.

Bundled payments, outcomes-based contracts, and virtual-first care are reshaping what systems get paid for—and how. Systems like Trinity Health and Sutter Health are developing primary care capitation and risk-adjusted reimbursement that aligns value creation with financial sustainability. These models allow systems to compete with retail players offering flat-rate transparency and monthly subscription models. In “The CEO’s Guide to Value-Based Care”, we explored how systemwide transformation requires alignment from CFO to CMO. Accordingly, value must be financially coherent—not just aspirational.

True value also includes social accountability. Health systems rooted in communities can offer something Amazon and Optum cannot—place-based trust and cultural fluency. Baystate Health launched a neighborhood-based care model focused on health equity, economic empowerment, and public health integration. Montefiore includes community members in governance and research prioritization. These efforts redefine value as shared prosperity—not just clinical efficiency. “If health systems want to be indispensable, they must be inseparable from community well-being,” said Dr. Darrell Gray. Thus, value must encompass the invisible threads that tie systems to the lives they serve.

Governance That Favors Agility

Legacy governance structures are often slow, risk-averse, and reactive—traits incompatible with the pace of disruption. Health systems competing with CVS and Amazon must overhaul decision-making processes to favor speed, experimentation, and accountability. Northwell Health restructured board subcommittees to include innovation, digital strategy, and workforce well-being. Mass General Brigham now holds “sprint sessions” where executives can approve pilots under $1M within 30 days. “The boardroom must move as fast as the platform,” said Anne Case, Princeton economist and health policy expert. Therefore, governance must evolve from compliance to capacity-building.

Metrics must also modernize. Traditional boards focused on margin, market share, and patient satisfaction are now tracking net promoter score (NPS), digital adoption, talent velocity, and innovation ROI. At UCHealth, leadership reviews product development cycles and consumer retention analytics alongside clinical dashboards. Trinity Health requires quarterly updates on workforce equity and digital transformation progress. These changes ensure that competitive positioning becomes a board-level priority. Thus, systems that update governance will unlock speed and strategic clarity.

Diversity and disruption readiness must also shape board composition. Systems competing for market relevance must include consumer behaviorists, technologists, and entrepreneurs alongside clinicians and financiers. Yale New Haven Health and Gundersen Health are recruiting board members from outside traditional healthcare sectors to bring fresh insight. “Innovation happens at the edges—so bring the edge into the room,” said Dr. Esther Dyson, digital health investor. Accordingly, governance is no longer neutral—it is either a strategic accelerator or barrier.

Rebuilding Brand and Trust in a Competitive Landscape

Health systems once relied on reputation, tradition, and proximity to attract patients—but those moats are shrinking. CVS and Amazon have brand trust, loyalty programs, and data insights that health systems often lack. Rebuilding competitive brand equity requires more than clinical reputation—it demands emotional trust, user-centered design, and bold transparency. Ochsner Health launched a “You Deserve Better” campaign that blends outcome data, patient stories, and digital experience guarantees. Cedars-Sinai pairs every service with real-time feedback and escalation response pathways. “Brand is not what you say—it’s what people feel,” said Scott Galloway, NYU Stern professor and brand strategist. Therefore, every brand decision must deliver emotional resonance and operational truth.

Transparency builds trust. In “Rebuilding Trust in U.S. Healthcare”, we explored how systems must share pricing, performance, and patient safety data in formats that are understandable and actionable. RWJBarnabas Health publishes its health equity performance annually and integrates social impact into its annual report. Saint Luke’s uses patient-reported outcomes to improve care pathways and communicate performance publicly. These efforts shift the brand from aspiration to evidence. Accordingly, trust is not built by logos—but by behavior.

Patient voice must become brand co-ownership. Systems like Children’s Hospital Los Angeles include patients and families on advisory boards, co-design committees, and research panels. Baystate Health has a real-time public dashboard tracking patient satisfaction and response rate to feedback. These models reflect a deeper truth: competitive brand identity is shared, not manufactured. “In the trust economy, patients are the storytellers—and the validators,” said Adrienne Boissy, MD. Consequently, brand must be co-authored with the communities it seeks to serve.

The Path Forward—Bold Strategy, Relentless Execution

Winning the future of healthcare will depend not on size, but on clarity of vision and speed of action. While Amazon, CVS, and Optum are equipped with capital, data, and reach, traditional health systems hold deep clinical expertise, community embeddedness, and public trust. The path forward demands that legacy systems operate with the agility of startups and the discipline of payers while honoring their public mission. Executives must reject outdated assumptions and redesign care around convenience, affordability, and personalization. This will require shifting budgets toward digital infrastructure, strategic partnerships, and new care modalities. At Northwell Health, leadership now uses cross-functional “war rooms” to evaluate market threats and deploy new service lines within 60 days. Trinity Health conducts quarterly strategy audits using external benchmarks from retail and tech competitors. Boards must become acceleration engines—not bottlenecks. “Healthcare strategy without speed is just paperwork,” said Dr. Toby Cosgrove. Therefore, strategic boldness must be matched with executional intensity.

In this new era, adaptability will matter more than legacy. Executive teams must be prepared to realign service lines, redefine roles, and reimagine care delivery models quarterly—not annually. This means questioning whether every clinic, tower, and business unit still aligns with the evolving demands of healthcare consumers. Systems like Mayo Clinic and Mass General Brigham are embedding innovation metrics into annual performance reviews and CEO dashboards. At RWJBarnabas Health, digital transformation goals are linked to workforce KPIs to ensure alignment across departments. Leadership development, once reserved for physicians or managers, must now include every employee with decision-making potential. “The enemy of innovation is not bad ideas—it’s organizational drag,” said Rita McGrath of Columbia Business School. As outlined in “Green Hospitals”, transformation is not linear—it’s systemic. Consequently, adaptability must be embedded in operating models, not tacked onto strategic plans.

The competition is not only external—it’s existential. Health systems must outpace disruption by becoming disruptors themselves, rooted in purpose but freed from tradition. Those who win will redefine access not just as entry but as engagement. They will make affordability synonymous with quality, and technology synonymous with empathy. These systems will bring healthcare into homes, workplaces, mobile apps, and retail centers without losing the essence of human-centered care. At Yale New Haven Health, a three-year innovation roadmap aligns every growth strategy with community health goals and technology investments. Ochsner Health is layering behavioral nudges and predictive alerts across its patient experience to guide behavior and personalize support. As we’ve explored throughout The Healthcare Executive, success is no longer about maintaining market share—it’s about transforming expectations. The systems that act today will define tomorrow’s healthcare economy. Thus, the moment to compete—and lead—is now.