Health IT inefficiencies are costing hospitals billions

In 2024, U.S. healthcare technology experts reported that inefficiencies, system downtimes and poor health IT integration have contributed to industry losses exceeding $8 billion annually, up from $1.7 billion in 2017, according to an Oct. 1 survey from Black Book Research.

The survey, part of Black Book's "What's Hot and What's Not in Healthcare IT Investments" report, included feedback from 907 healthcare professionals, highlighting the systems that failed to meet return on investment expectations after deployment.

Every participant in the survey reported facing financial losses, major workflow disruptions, reputational damage or the loss of key staff due to IT software or outsourcing initiatives at hospitals, physician practices, or payer organizations within the last decade.

Here are nine key findings from the survey:

1. EHR systems were the most significant source of frustration. Seventy-seven percent of respondents cited ongoing issues such as clunky workflows, lack of customization, and difficult navigation, leading to "click fatigue" and inefficiency. Small practices (91%) also criticized major hospital EHR systems for being overly complex and hard to maintain without adequate IT support.
   
   
2. Among respondents, 81% said that many telehealth solutions failed to integrate with existing EHR systems, leading to data silos and workflow inefficiencies.
   
   
3. Seventy percent of respondents expressed dissatisfaction with RCM systems, citing outdated software and a lack of automation features like AI. This has led to longer claims processing times and higher denial rates for 79% of organizations. Sixty-one percent pointed to poor claims scrubbing and denial management capabilities.
   
   
4. Health information exchanges also fell short, with 23% of physician practices reporting struggles with data standardization and integration. EHR interoperability issues further hindered 28% of medical practices, preventing access to complete patient records.
   
   
5. Clinical decision support systems fared similarly, with 80% of users citing poor integration with EHRs. Many first-generation CDS tools overwhelmed clinicians with irrelevant alerts, leading to "alert fatigue." In addition, 93% of users found their CDS systems lacked real-time, evidence-based guidance.
   
   
6. Patient-engagement platforms, especially early patient portals, saw low adoption rates. Seventy-seven percent of hospital systems reported poor user interfaces and limited functionality, while 88% of providers using niche patient engagement solutions cited poor EHR integration and lack of mobile features as major barriers.
   
   
7. Despite the hype surrounding AI and machine learning, most early adopters have been disappointed. Ninety-six percent of healthcare IT executives reported challenges with AI ROI, while 92% of early adopters said their AI systems were not accurate or actionable enough for clinical use. Similarly, 85% of those using AI for diagnostics or treatment planning saw little to no ROI.
   
   
8. Interoperability remains a persistent issue, with 31% of those surveyed saying they were dissatisfied with their data interoperability vendors. Smaller platforms, in particular, struggled to keep up with evolving standards like FHIR, leaving 8% of providers stuck with outdated systems.
   
   
9. When asked to identify the top reasons for healthcare IT systems failing to deliver value, respondents ranked the following: 48% cited poor user experience, 24% pointed to lack of interoperability, 20% blamed high costs, 6% noted inflexibility in adapting to specific workflows and 2% cited alert fatigue from CDS systems.