Healthcare providers and payers increased their IT spend in the last year and many see additional budget bumps in the future, according to a report compiled by KLAS and Bain & Co.
The report surveys 150 healthcare provider and payer executives across the U.S. More than half of providers said software and technology investments were in the top three priorities for their organizations, and around 80% indicated their IT budgets increased in the last 12 months.
The top five software and digital technology priorities for providers this year include:
1. Infrastructure and services (with cybersecurity)
2. Clinical workflow optimization
3. Data platforms and interoperability
4. Revenue cycle management
5. Patient engagement
EHRs were No. 6 on the list and telehealth was No. 8. The top pain points for new technology were costs, EHR integration and streamlined data access. The leaders surveyed also cited interoperability and cybersecurity vulnerability as big challenges for new technology integration.
"Despite a bias toward 'good enough' solutions from current EHR suppliers, most providers remain open to buying solutions from other vendors," states the report. "This occurs especially in categories that deliver high ROI or that feature rapid innovation. In these circumstances, providers will often consult their EHR vendor's product roadmap before selecting a third-party solution and cite EHR integration as a key purchase criterion."
Generative AI was also top of mind for provider IT leaders, with around three-quarters of the leaders feeling optimistic about their organization's implementation. Many provider organizations have begun piloting generative AI applications focused on clinical documentation and support tools, according to the report, with promising early results. But there are challenges, with most health systems still developing governance for AI and new regulatory concerns arising.
The top barriers for generative AI as cited by providers were:
1. Regulatory and legal consideration:43%
2. Resource constraints: 40%
3. Accuracy, safety and hallucinations: 39%
4. Lack of technical expertise: 33%
5. Cybersecurity risk: 32%
"Amid diverse approaches to IT investment, healthcare providers and payers are doubling down on their commitment to investing in IT solutions, with a renewed focus on cybersecurity. Providers grapple with budget challenges and the need to integrate new solutions with EHRs and other suites. To address these obstacles, they are concentrating on solutions that offer clear, rapid ROI and that have proven integration," states the report.
The Change Healthcare ransomware attack early this year also affected IT budgets. Around 70% of providers said they were affected by the incident and 44% reported auditing internal systems. Nearly half also audited current vendors and 38% said their organizations increased cybersecurity software spending.
"While cybersecurity was already top of mind for most organizations, they are allocating greater efforts and spending to this area, including auditing internal systems and third-party solutions and building redundancy to mitigate future risks," according to the report.