By Lou Sokolovskiy
For too long, American healthcare has organized itself around the hospital, says Eric Tower, a veteran healthcare attorney and advisor who believes that costly model is no longer sustainable and must change.
“You don't have to be treated in the hospital,” he told me. “You can be treated in a less intensive environment. And that can be just about anything.”
Tower has spent 35 years in healthcare law, working on acquisitions, reimbursement, fraud and abuse, and strategy, and also serving inside a major health system with responsibility for its medical group and mergers and acquisitions. He previously served as an executive and senior in-house counsel for the largest healthcare system in Illinois.
What Tower sees is a system whose old boundaries no longer hold. He told me healthcare used to be far more fragmented, with clearer lines between who paid, who delivered care, and where care happened. Now those lines are breaking down as insurers, physician groups, health systems, and specialty platforms expand across the continuum.
“If you insist on serving just as a standalone,” he warned, “you're likely to see people encroach in who you never imagined coming in.”
That warning matters because the economics are becoming impossible to ignore. According to CMS, U.S. health spending reached $5.3 trillion in 2024, equal to 18.0% of GDP. Employers are under pressure too. KFF reported that the average annual premium for employer-sponsored family coverage reached $26,993 in 2025, with workers paying $6,850 on average. Over five years, family premiums rose 26%.
“There's a huge focus by payers and employers… on the so-called total cost of care,” he said.
In plain English, that means the old question, “What did this visit cost?” is being replaced by a harder one: “What does the full episode cost, and did this care keep the patient healthier and out of a more expensive setting later?”
Tower’s answer is that the opportunity is shifting away from the traditional hospital-centered model and toward care that is coordinated across settings.
“Non-institutional healthcare services are positioned to do really well if people adapt appropriately,” he said.
His point is not that hospitals vanish. It is that more care will move to places that can treat patients safely at lower cost, and the winners will be the groups that can manage care across that broader system. Chronic disease makes that shift even more urgent. The CDC says 90% of the nation’s $4.9 trillion in annual healthcare expenditures are for people with chronic and mental health conditions.
“In the long term,” he said, “everything is moving ambulatory.”
