Healthcare financial leaders were unanimous in their expectation that they will face "a significant revenue decline" this year.
All healthcare CFOs expect to see revenues decline this year and plan to adjust spending in response to the ongoing coronavirus disease 2019 (COVID-19) pandemic, but only 12% plan to cut spending on digital transformation efforts, according to a Black Book Research survey released Wednesday.
The COVID-19 outbreak has battered hospital and health system bottom lines, which has forced leaders to deal with lower than expected revenues and urgent expense control needs.
According to Black Book, more than 84% of hospitals and 79% of physician practices have conducted audits on "the existing state of their digital transformation," with more than 90% acknowledging that they lacked capabilities or had "redundant or conflicting systems" during Q2.
The survey indicated that shrinking margins and the lack of financial analytic tools has hampered struggling hospitals and "put focus on the immediate technology needs of chief financial officers."
"It would seem most CFOs understand what the pandemic has proved is the need to speed up digital transformation initiatives to not only survive but to prosper in the new normal," Doug Brown, president of Black Book Research, said in a statement. "For CFOs eager to expedite their organization's digital transformation, the standardization and simplification leaders want in their back-end processes are allowing for less complicated, faster adoption despite the times."
Additionally, the survey found that nearly 90% of providers have embraced virtual care solutions, almost 75% have initiated "highly patient positive experiences," and over half have had to commence with "layoffs and process changes."
Prior to the pandemic, digital transformation was viewed as a popular initiative for healthcare finance leaders.
A Black Book survey released in June 2019 indicated that 79% of health system CFOs and 89% of senior finance officers would increase investments in digital transformation by the end of the year.
The primary drivers for financial digital transformation, according to health system finance leaders, were reducing the cost of care, improving care coordination, and preparing value-based care payments.
However, despite the enthusiasm for pursuing digital transformation efforts, healthcare leaders have fallen short of a full embrace of data analytics in recent years.
A Black Book survey released in January found that 80% percent of healthcare leaders said their use of data analytics for decision-making and strategic planning is "negligible."
Surveyed health system CFOs expressed skepticism about the effectiveness of data analytics at their respective organizations, with 15% reporting that analytics assisted in financial forecasting or decision-making while only 6% overbought data tools without budgeting for additional costs to accomplish more.
Jack O'Brien is the finance editor at HealthLeaders, a Simplify Compliance brand.