Digital Transformation Investment Critical to Health Systems Survival, Says Senior Financial Leadership in Black Book Study
TAMPA, Fla., June 7, 2019 (Newswire.com) - Black Book™ surveyed nearly 1,600 hospital and health system Chief Financial Officers, Vice Presidents of Finance and RCM, Controllers, Business Office Managers, Staff, Consultants and Directors to spot trends, collect insights and assess the gaps and urgencies of financial technology administration.
According to our latest research study, investment in digital transformation is vital for health systems to keep a competitive advantage. Overall, 8 in 10 CFOs surveyed believe that digital transformation is critical for their health system to survive long term and maintain quality patient services.
To stay competitive in the current healthcare provider marketplace, 79% of CFO respondents and 89% of all other senior finance officers in health systems plan to increase their investment in digital transformations by the end of 2020. Of these, 68% forecast an increase of more than 20% by the end of Q1 2020.
Notably, while 28% of hospitals and health systems over 150 beds admit playing catch up to the provider organizations in their markets nationally, 19% claim matching their competition’s digital offerings.
Only 9% of respondents indicated that their digital transformation investment efforts are directed at their regional competition through differentiation, compared to 40% of all other non-healthcare CFOs measured by Black Book cross-industry surveys.
“Over the past five years, investment strategies for digital transformation have been influenced among healthcare providers more by the desire to improve operational performance and reduce costs,” said Doug Brown, President of Black Book. “Survey results indicate that future investments are moving towards improving patient experience, and differentiating from the competitors via technological innovations, including the interaction with patient payment and financial systems.”
The survey reveals that in 2019, creating exceptional patient and health consumer experiences represented a shift from internal operations concerns to external perceptions of healthcare services, outcomes, product lines, financial interactions, and improved care technologies that at least keep up with local or regional competitive health systems.
In the Q1-Q2 2019 Black Book survey, CFOs agree that their three top IT challenges are:
System Integration Across the Healthcare Enterprise (92%)
Upkeep of Current Financial Legacy Systems (84%)
Lack of Financial IT Talent (81%)
“Hospital financial functions which could benefit immensely from technology investments have been routinely deprioritized for the past five years because of budgets required for pricey electronic health records implementations”, said Brown. “Investment decisions have been made even more complex because there has been fluidity in healthcare organizations in determining key performance indicators to measure the financial success of new information technologies like population health tools.”
85% of senior healthcare financial leaders surveyed reveal that they do not have suitable financial metrics for IT ROI compared to 36% of CFOs in other industries.
The Black Book survey indicates that the adoption of new technologies in the healthcare finance functions through the next 5 years is correlated to better data quality, data mining for strategic analysis, optimized financial processes, minimizing billing errors, reducing operational costs and streamlined financial reporting.
Notably, three-quarters of all US hospitals have automated their financial transactions processes since 2013, however most are now outdated say 70% of CFOs.
Top Healthcare Financial Processes Automated in Q2 2019
Accounts Receivable/Accounts Payable 80%
Financial Reporting and Control 74%
Working Capital Management/Treasury 70%
94% of Healthcare systems and provider organizations anticipate a significant shift in IT spending to the CFO’s Office in 2020.
Top Healthcare Processes to Be Automated in 2019-2023
Financial Planning 86%
Advanced Financial Analytics 83%
Budgeting and Cost Accounting 79%
Forecasting and Decision Support 75%
Strategic Planning 61%
Financial Reporting 58%
"Future investments in healthcare financial automation will focus on better strategy, analysis and predictions for growth," said Brown.
57% of CFOs report that with few proven cases of digitization in healthcare finance including few best practices to pattern after, the finance team has been content to let CIOs pursue the issue. However, 94% of CFOs intend to dedicate more time to the application of digital technologies to finance tasks without CIO input in the coming five year period.
90% of CFOs expect to move to active implementations of transformational software and services in 2020 from the current state of tire kicking.
Current Drivers of Financial Digital Transformations in Healthcare
Reduce Cost of Care 96%
Improved Care Coordination 93%
Ready for Value-Based Care Payments 90%
Upgrade Credit Rating 90%
Improve Patient/Consumer Experience 76%
Improving Regulatory Status 74%
Need of Steady Predictable Earnings 72%
Financial operations to accelerate decision support is the short-term goal of 88% of all CFOs surveyed in Q1-Q2.
About Black Book
Black Book™ has polls for vendor satisfaction and industry trends across the healthcare software/technology and outsourcing sectors around the globe. Since 2009, Black Book began polling the client experience of now over 840,000 healthcare software and services users. Black Book expanded its survey prowess and reputation of independent, unbiased crowd-sourced surveying to IT, clinical, operations and financial professionals, physician practice administrators, nurses, consultants, executives and hospital information technology managers.
For methodology, auditing, resources, comprehensive research and vendor ranking data, see http://www.blackbookmarketresearch.com or contact us at email@example.com.
Results of the 2019 Revenue Cycle Management software and managed services user surveys will be announced in August. The annual Black Book CFO & Senior Finance Leadership Report can be viewed at https://tinyurl.com/yxgwmvem.
Source: Black Book Research