In 2023, health care leaders anticipate challenges impacting hospitals and health systems. Staffing, inflation, margins, and supply chain issues shape overall strategy in the field of health economics and outcomes research. Stay informed about the evolving landscape.
Here are the top four factors that Deloitte expects will impact health care in the next year.
Inflation and affordability
Healthcare is no longer immune to inflation, as 76% of health care executives feel it will have a substantial impact on their strategy. 7% of those polled thought it was unlikely to have any effect.
Similar to when the pandemic occurred, increased living costs may cause some patients to postpone routine care and testing, which may have a severe influence on their health.
Despite the fact that the majority of health system officials asked by Deloitte said that inflation will have a substantial effect on their strategy, less than half of health plan executives felt it would. The report indicates, however, that the effect of health care pricing would most likely trickle down to health plans after 2023, when health systems will most likely face the brunt of the financial burden.
Rising borrowing rates, according to Deloitte, may make it more difficult for healthcare companies to implement digital transformations and upgrade their systems.
Only 29% of respondents from the health system stated that rapid digital transformation would have a significant effect on their organization’s strategy in 2023, while 63% said it would have a moderate impact. Accelerated digital transformation is expected to have a “great impact” (43% of health plan executives) or a “moderate impact” (50%).
According to Deloitte, the response gap may be attributed to health system executives wanting to make change but are unsure how to pay for it, or they are ready to begin long-delayed projects. Furthermore, when it comes to technology, health plans often lead health systems.
Several health systems suffered decreased patient numbers and revenue during the pandemic, and many have yet to recover to pre-pandemic levels. Due to rising labour and supplier costs, 2022 may end up being one of the most financially tough years in hospital history.
Patients who delay treatment continue to lower income, and more patients are preferring ambulatory facilities over hospitals for non-emergency procedures.
According to the report, the median operating margins of hospitals and health systems fell 46% in September compared to the same month a year ago. Many hospitals, particularly small and locally owned and run ones, would be unable to resist this margin compression. As a result, some hospitals may be bought out, while others may be forced to close.
New payment methods and alternative care locations
Switching to new payment models such as value-based care (VBC) is the #1 target for health plan executives surveyed by Deloitte for 2023. Many health plans are expected to start the new year in a strong financial position due to fewer medical claims in 2022. Hospitals and health systems, on the other hand, will be more concerned with cutting losses in 2023. As a consequence, health insurers may find it difficult to migrate their network providers to new payment models.
Customers, according to the report, want greater convenience, which might lead to the establishment of alternative care websites that give a better user experience. Alternative sites of care are not new, but their popularity is growing as the retail and digital industries collide and the public sector becomes more aware of the need to promote health justice and improve the customer experience. As customers alter how they want to be treated, the traditional health care visit and experience are being pushed to be more in line with other interactions they have in daily life.
While hospitals and health systems are likely to have another challenging year as they try to balance financial pressures with the need to invest in the future while ensuring high-quality care, the majority of health plans are expected to become profitable in 2023.