Healthcare executives have reasons to believe digital health solutions will eventually pay off.
For healthcare leaders, investment in technology right now requires more than just resources—it also demands patience and willingness to trust the process.
As technology continues to evolve, so will organizations’ understanding of how it impacts the bottom line. For that reason, hospital CEOs must remain committed to investing in new technology for the long haul despite slow return on investment (ROI) out of the gate.
Decision-makers across the industry agree, according to Ernst & Young’s survey of over 100 payer and provider executives. While seven in 10 respondents (71%) said the implementation of new technologies hasn’t lowered hospital expenses, nearly all (96%) believe that the investment in new technology is worth the cost.
The sentiment is important for leaders in an industry that is typically slower to adopt and implement technology. Hospitals may not have to be at the forefront of new technology, but with financial and workforce challenges wreaking havoc at facilities across the country, many organizations can’t afford to fall behind the curve. And CEOs seem to understand that.
“In a very touchy-feely space like healthcare, or at least traditionally is, [technology] is sometimes foreign to us old heads,” Phil Wright, CEO of Memorial Regional Hospital South, told HealthLeaders.
“We're used to still touching patients and talking to patients and the more and more we create these solutions around AI and technology, it can be a little scary. On the flip side, all of this technology and innovation, if used properly, can do nothing but help the patient process, help us become more efficient, help us make better decisions about how we deliver care, help us be more precise and accurate in the types of medicines, the types of treatments that we're able to give. So I'm kind of excited about it.”
Measuring ROI
Leaders may not be seeing any ROI yet, but that doesn’t necessarily mean it’s not coming—or isn’t already here, even.
Ernst & Young’s survey found that 86% of respondents acknowledge the potential cost reduction from digital health investments, highlighting that many executives recognize that the value is there.
However, that value could be difficult to quantify, as half (50%) of respondents said the lack of ROI so far is influenced by “siloed tracking metrics.”
To keep up with technological advancements, organizations must improve and refine their approach to tracking to go beyond the traditional means. Switching to unified monitoring can allow hospitals to collect and analyze data in a more standardized way, leading to more informed decisions over what is and isn’t working.
Investment in technology is not as effective without the investment in solutions to properly track it.
Beyond the numbers
Arguably the best area CEOs can invest in right now, through technology or otherwise, is in their people.
Workforce continues to be the top priority for hospitals as shortages of clinical workers and burnout slow down operations.
By utilizing technology to supplement the workforce, leaders can do more with less while keeping staff happier. In Ernst & Young’s survey, nine out of 10 executives said that after shifting administrative responsibilities to a digital system, their department has more time to focus on the needs of their providers.
Solutions that reduce administrative burden and allow physicians and nurses to spend more time caring for their patients will pay off in the long run by cutting down on turnover.
“We want to make sure that the non-productive work or the administrative burden that is placed on our caregivers, we're removing that out into a centralized location, so our nurses don't have to be burdened with those administrative tasks,” Michael Charlton, CEO of AtlantiCare Health System, told HealthLeaders. “They should be at the bedside, they should be delivering exceptional care, providing compassionate care and empathy. But how do they maintain that? We feel that pulling that work outside and using tech to do that, that's really the next iteration.”
The returns on technology may not be fully realized yet, but as long as CEOs are thoughtful in how they invest, the results will eventually come, whether that’s reflected on the bottom line or on the understanding of what the future of healthcare is.
Jay Asser is the contributing editor for strategy at HealthLeaders.
KEY TAKEAWAYS
Ernst & Young’s survey of payer and provider executives found that 96% of respondents think investment in new technology is worth it, despite 71% saying investments haven’t lowered hospital expenses yet.
The lack of ROI up to this point could partly be due to “siloed tracking metrics” not giving a cohesive picture of technology’s impact.
Still, by using technology to cut down on administrative tasks for physicians and nurses, CEOs can keep their staff happier and reduce turnover over time.