The first half of 2024 has already been a busy one for health system CIOs, with cyberattacks disrupting large swaths of the healthcare industry and an increased focus on artificial intelligence.
But what does the second half of the year have in store? Here are six issues healthcare CIOs will be paying attention to over the next six months:
1. Cybersecurity: Cybersecurity remains a top priority for hospital and health system CIOs due to the rising frequency of healthcare cyberattacks. Ransomware attacks in particular have surged, nearly doubling in 2023, according to cybersecurity firm Emsisoft.
This trend has prompted CIOs to increase their cybersecurity budgets and teams. An April survey by Moody's Investors Service, which included 148 healthcare organizations, revealed that from 2019 to 2022 cybersecurity teams expanded by 30%. Additionally, cybersecurity spending grew to 7% of the total IT budget last year, up from 5% in 2019.
2. Artificial intelligence: AI is a significant focus for CIOs with many organizations investing in the technology despite economic uncertainty. This is because many CIOs see AI as an opportunity to improve patient care, streamline administrative tasks and forecast patient outcomes.
CIOs are exploring the use of AI to analyze vast amounts of healthcare data, including EHRs, medical images and genomic information, to identify patterns and insights that human clinicians might overlook.
Health systems are also increasingly forming partnerships with technology companies to leverage the potential of AI. Some of these partners include Microsoft, Epic and Abridge. However, AI adoption is not without its concerns and obstacles. Nurses have recently voiced their apprehensions through protests, expressing concerns that AI may jeopardize patient safety and emphasizing the irreplaceable role of human nurses in healthcare delivery.
Because of this, healthcare organizations are working to ensure that their use of AI doesn't cause unintentional harm to patients as well as educating staff that this technology is meant to augment their jobs, not replace them. Health systems are doing this by creating AI frameworks and hiring dedicated leaders to steer their AI efforts.
3. Digital transformation: Nearly all CIOs are actively pursuing digital transformation. According to a June 7 report from McKinsey & Co., 75% of health system executives prioritize digital transformation. However, they face significant resource shortages for implementation due to the current macroeconomic climate and rising cost pressures.
Budget constraints remain a major obstacle to large-scale investments in digital and AI initiatives. Challenges with legacy systems are the second-greatest concern; modernizing core technology is crucial, but health systems struggle with outdated systems. Other challenges to digital transformation include data quality, tech talent recruitment, and readiness to adopt and scale new technology.
Despite these challenges, CIOs are still investing in digital transformation. The report highlights that the greatest areas of investment include virtual health, revenue cycle management and digital front door initiatives.
4. IT budgets: Many health system CIOs are operating under budgetary strains, learning to do more with less and prioritize digital technologies with the best returns on investment. For some tech executives, that has meant a return to the basics, concentrating on having a strong IT "foundation," while other leaders are moving forward with the latest technology, like generative AI.
CIOs hope that AI can continue to increase automation and thus reduce costs across cash-strapped health systems — including in the IT department — but many leaders say the technology isn't there yet.
5. EHR consolidation: Health systems continue to unify their EHRs, with Epic being the clear winner in that equation, particularly among big health systems and academic institutions. After years of hospital consolidation, health systems are opting to move to one EHR for streamlined record-sharing. Following mergers, hospitals are also migrating to the EHR of their new parent systems.
As one CIO put it to Becker's, "integration" has beaten "interoperability" in health IT, with many tech leaders preferring one solution that can do everything rather than having EHRs for every different department and specialty. CIOs expect this trend to continue.
6. Staffing: The labor market remains a concern for health system CIOs, who are competing with technology companies and other businesses for talent while trying to maintain budgets to afford top workers. While the job market has cooled down from a couple of years back, talented tech employees can still command hefty salaries and demand perks like flexible schedules. CIOs focus on the mission of healthcare in their recruitment pitches.
Some health systems have laid off tech staffers in recent months, while others have opted to outsource their IT departments to companies like Optum or IBM spinoff Kyndryl. IT leaders expect the outsourcing trend to pick up among smaller systems that want to focus more of their resources on digital innovation.