What trends are impacting healthcare organizations this year? Where do leaders anticipate their focus will be in three-to-five years? To get a pulse on what industry leaders are thinking, Huron surveyed 300 healthcare executives across the U.S.
Responses across five functional areas — strategy and innovation, finance and operations, clinical care, technology, and people — offer key insights into where the industry stands today and what actions executives are taking to position their organizations for stability and growth.
Financial management emerges as a central theme
Leaders report that financial management is the highest priority for both timelines when asked what trends they expect to impact their organizations in the next 12 months and in three-to-five years. Trends include:
- Redefining portfolio (No. 1 for both timelines)
- Cost reduction/optimization (No. 2 this year; No. 3 in three to five years)
- Price increase/optimization (No. 3 this year; No. 2 in three to five years)
The main challenges leaders expect tell a similar story, with the top three all relating to financial management. Challenges include:
- Cost reduction/optimization
- Price increase/optimization
- Redefining portfolio/changing healthcare business models
Leaders further report that financial pressure will come from:
- Rising labor costs
- Pricing optimization
- High cost of capital
- Supply chain and vendor costs
- Revenue cycle management
Four core responses to challenges
Leaders face persistent and emerging market trends that require prioritizing the organization’s bottom line while reinvesting in their people and businesses. How will they respond to this dual challenge? Huron’s research indicates that a multifaceted approach is essential for tackling the diverse mix of trends and challenges, anchored by four core actions.
1. Making digital-first investments
Healthcare organizations indicate a growing prioritization of initiatives to help them move towards becoming a more efficient, digital-first organization. Organizations will focus on managing and using data for:
- Uncovering critical insight into patient behaviors.
- Improving treatment and patient care.
- Optimizing operational efficiencies.
- Making analytics-driven decisions.
Digital-first organizations bring technology and corporate culture together to become more agile, respond quickly to shifts in the market, and remain financially viable amid volatility.
2. Evolving talent and workforce
The second strategy addresses workforce challenges, including the top financial pressure of rising labor costs. Organizations are evolving their talent and workforce strategies to encompass:
- Restructuring company and senior leadership.
- Investing in talent and employee training.
- Adopting flexible staffing and remote work.
- Expanding offering to include virtual care.
- Fostering a culture of continuous learning and innovation.
All these measures aim to make the workforce more efficient, adaptable, and resilient to changes.
3. Advancing care delivery and health equity
Value-based care models and consumerism are pushing leaders to rethink how they deliver care. Advancing care delivery includes how organizations promote health equity, ensuring every individual has a fair opportunity to attain quality care. Leaders will look to improve quality of care and accessibility through:
- Investing in consumer engagement and retention.
- Ambulatory expansion planning.
- Integrating care delivery models across the continuum.
- Investing in care access and social determinants of health (SDOH).
Expect to see organizations prioritizing accessibility and affordability by pivoting towards a patient-centered approach.
4. Optimizing operations and business models
The simultaneous pressure to drive growth while reducing costs is forcing healthcare leaders to rethink the way their organizations operate. With redefining portfolio top-of-mind across current and emerging trends as well as expected challenges, organizations will have to determine what works best for their unique circumstances. Initiatives to enable operational improvement and drive growth include:
- Reducing capital expenditures.
- Increasing reimbursement accuracy.
- Optimizing supply chain management.
- Finding merger, acquisition, and partnership opportunities.
Resolving complex challenges remains the imperative, as leaders try to strike a balance across initiatives that simultaneously reduce costs and drive growth.