ABSTRACT
In January 1993, Dean Daniel Tosteson convened a series of meetings with representatives of the five largest Harvard teaching hospitals and the Harvard Medical School to discuss a coordinated response among the five to the far-reaching changes taking place in health care. Data presented by Bain and Company, which had been engaged as consultants to the group, illustrated the magnitude of change taking place in health care. The hospitals had begun to experience declining occupancy and reduced revenues. In addition, Bain's analysis showed that the Harvard hospitals were 30 percent more expensive than high-end community hospitals and 65 percent more expensive than the lowest-cost community institutions. The statistics, especially those regarding cost and overcapacity, called for major changes in hospital strategy.
