Top Healthcare Trends of 2024: What Executives Are Watching

As 2024 continues to unfold, healthcare executives are paying close attention to several key trends that are shaping the future of the industry.

It’s no secret that these are trying times for hospital and health system leaders. As we have learned from our interviews, research, and virtual and in-person events, there is no shortage of challenges from every facet of healthcare organizations from CEOs to revenue cycle executives.

From financial pressures to workforce challenges, these developments are set to impact how hospitals and health systems operate in the coming years.

Here are the top eight trends that our healthcare leaders have been monitoring most this year.

1. Mounting Financial Pressures

Healthcare systems are grappling with significant financial strain as costs continue to surge. Labor expenses increased by over $42.5 billion between 2021 and 2023, largely driven by workforce shortages.

On top of that, drug shortages in 2023 reached their highest levels in a decade, compounding costs for hospitals. Executives are under pressure to find ways to cut expenses without compromising care, making financial resilience a top priority.

2. Physician and Nursing Shortages

The U.S. healthcare system is facing a critical shortage of doctors and nurses. Projections suggest a shortfall of up to 124,000 physicians and 450,000 nurses by next year. This shortage poses a significant threat to the quality and accessibility of care.

As demand for services grows—especially with an aging population—healthcare executives are tasked with developing strategies to address this staffing crisis, from recruitment initiatives to improving working conditions to retain current staff.

3. Rising Influence of Payers

The balance of power between hospitals and insurers is tilting further in favor of payers. Large insurers have grown substantially, now dwarfing many health systems, and their increased leverage is creating new challenges for hospital leaders.

Negotiations over reimbursements are becoming tougher, with hospitals facing delayed payments and tighter reimbursement policies. Healthcare executives are trying to keep their heads above water in this complex payer landscape—and all while trying to ensure sustainable financial performance.

4. Regulatory and Policy Changes

Shifting regulations are reshaping the healthcare industry.

From price transparency mandates to potential reforms to the 340B drug pricing program, regulatory changes are poised to continue to impact hospital operations. Executives are also still watching the (never-ending?) push toward value-based care models, which after almost 20 years is still yet to come to fruition. But here’s to hoping?

All of these shifts require hospital leaders to adapt quickly, ensuring compliance while exploring opportunities for improved care delivery and cost efficiency.

5. Surge in M&A

The healthcare industry is experiencing one of the largest waves of mergers and acquisitions in over a decade.

As hospitals face rising costs and competitive pressures, many are looking to consolidate to improve operational efficiencies and strengthen their financial position. M&A activity is expected to continue at a rapid pace, with health systems increasingly pursuing cross-geographic deals to share resources and create synergies in an evolving market.

6. Non-Traditional Competitors

Digital-native companies and retail health giants are emerging as formidable competitors to traditional healthcare providers.

These disruptors are capitalizing on new patient preferences for more convenient, cost-effective care. With the ability to offer targeted services and significant capital at their disposal, these non-traditional players are reducing inpatient utilization and attracting valuable patient segments.

Hospital executives must adapt to this competitive landscape by improving their own offerings and patient experience.

7. Technology and Digital Transformation

As technology continues to reshape the healthcare landscape, hospitals are investing in digital tools to enhance both patient care and operational efficiency.

From self-scheduling platforms to omnichannel patient experiences, digital transformation is key to meeting modern consumer expectations. Additionally, technology is being used to streamline back-end processes and improve care coordination, making it a crucial focus for hospital leaders aiming to stay competitive and efficient.

8. Workforce Recruitment and Retention

Attracting and retaining healthcare workers is an ongoing challenge for hospitals, particularly in light of the current shortages in both clinical and non-clinical roles.

To combat burnout and improve retention, many health systems are investing in new technology solutions aimed at reducing administrative burdens and improving staff workflows. By prioritizing workforce well-being and creating more efficient environments, healthcare executives hope to build a more stable and satisfied workforce.

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