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Healthcare chief finance officers (CFOs) have moved cost reduction, consistently among the top three priorities for the past three years, to the bottom of the list of concerns.
These were among the results of a Deloitte survey highlighting a broader strategic pivot among healthcare finance leaders to improve profitability.
The report also revealed optimizing the workforce remains a primary lever for achieving cost savings.
A quarter of the more than 60 finance leaders from U.S. health plans and systems said they have failed to meet their operating margin goals in the past three years — a challenging environment in which plans for growth are seen as crucial strategy going forward.
The survey revealed marketing and branding have emerged as the foremost strategic growth priorities, with a third of health plan CFOs surveyed and nearly half (48%) of health system CFOs identifying these areas as critical.
Meanwhile, more than eight in 10 (84%) of finance leaders surveyed said they are investing in advanced cybersecurity technologies, and six in 10 said they are prioritizing investments in core technologies such as customer relationship management (CRM) platforms.
Nearly two-thirds of surveyed leaders said they plan to invest in venture opportunities within health or non-health startups over the next two years, indicating an evolving approach to revenue diversification.
Other strategies, though chosen by fewer than one-third of the CFOs surveyed, could significantly enhance operating margins, including optimization of the product and service mix, pursuing alliances and ecosystems, exploring outsourcing and offshoring opportunities, and intensifying the adoption of digital and AI technologies.
WHY THIS MATTERS
Healthcare CFOs are increasingly focused on value-based care and the associated reimbursement challenges, as they navigate higher costs and the pressing need for margin improvement.
These concerns are shaping their strategic priorities, with the changing payer mix, highlighted by a growing reliance on Medicare and Medicaid, a significant factor driving this shift.
Meanwhile, CFOs are looking to leverage AI and automation wherever possible as they deal with staff compensation issues and high turnover rates.
THE LARGER TREND
Healthcare systems globally are tapping into the power of automation and AI, for example Bangkok Hospital, which is leveraging AI to streamline patient flow, and use of augmented reality (AR) and virtual reality (VR) tools to expand patient care.
At Florida-based not-for-profit health system Lee Health, the use of Generative AI (GenAI) has helped reduce documentation errors and streamlined operations to the extent that one extra patient per day can be added to the physicians’ schedule.
ON THE RECORD
“Looking ahead, finance leaders could be in a unique position to spearhead transformative change and guide their organizations toward increased profitability,” the report concluded. “It seems like the time is now to begin challenging the status quo and exploring novel strategies that will reshape the health care industry’s financial landscape.”