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An integrated healthcare system (IHS) is a set of organizations that provides for or arranges to provide coordinated and continuous service to a defined population. The IHS takes responsibility for that particular population's health status and outcome, both clinically and fiscally. An integrated healthcare system is a well-organized, well-coordinated, and collaborative network. The integrated delivery system is a network that connects different healthcare providers to deliver organized, coordinated, and collaborative care through common ownership. Integrated healthcare focuses on population health by improving the quality of healthcare and reducing healthcare costs.

There are two types of integrated healthcare systems:

The first type is horizontal integration, in which organizations that deliver the same level of care are grouped under single management—for example, a multihospital system merges and makes alliances with neighboring hospitals to form a local network. The Pan American Health Organization defines horizontal integration as "the coordination of activities among operational units that are at the same level in the process of providing services." This will consolidate the organizations' resources to boost efficiency and save money.

The second type is vertical integration. Here, organizations that deliver different levels of care are grouped under one management—for example, allying with physicians or health maintenance organizations like academically affiliated medical centers or home care facilities. The Pan American Health Organization defines vertical integration as "the coordination of services across operating units at different stages of the process of delivering patient care." The aim is to increase efficiency and global capitation management, broaden patient and provider pools to diversify risk, lower payer contracting costs, improve quality of treatment, and a seamless continuum of care.

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