Staff shortages, high labor costs, and narrow margins are just a few of the major financial and operational challenges that affected healthcare providers in 2023.
The potential roadblocks confronting providers are not merely confined to that short list, however. Providers are also grappling with increasing costs associated with drugs and supplies and an overload of administrative activities related to burdensome billing and insurance tasks, according to a recent report from the American Hospital Association.
Overall, hospital expenses rose 17.5% between 2019 and 2022, leading to operating losses for some hospitals and closures for those most severely affected, according to the report.
The challenges that smaller providers must overcome are similar to those large hospitals faced in 2023, with some likely to persist into the coming year. Many of providers’ financial and operational burdens, however, can be alleviated by modern patient payment systems featuring digital patient engagement tools.
Here are a few trends we expect to observe over the next year, as providers endeavor to realize efficiency gains that reduce costs and improve affordability for patients.
Responsible use of artificial intelligence: Artificial intelligence offers a broad range of possibilities for improving healthcare, the patient experience, and efficiency. Some use cases to watch are easing staff burdens, assisting with diagnosis and treatment, and communicating with patients. Before healthcare organizations implement AI-based tools, they should ensure that there is a strong, clearly documented policy laying out the framework for the appropriate use of AI; that staff receive the proper education and training; patient privacy is being protected; and that the benefits and drawbacks of the technology are carefully weighed.
Next-generation payments: Healthcare providers are realizing that patients want the same flexibility in terms of payment options that they have come to expect from in-person retailers and online merchants. To satisfy patient demands, look for more providers to prioritize the adoption of next-generation payment methods, such as digital wallets, e.g., Apple Pay, Google Pay, PayPal, and buy-now-pay-later plans. By offering these options, providers can make it easier for patients to pay for their care in ways that are convenient, flexible, and secure. While we are still in the early stages of adoption, some clients are seeing more than 10% of their online patient payment volume come from digital wallets.
Increasing self-service patient tools: Labor shortages and rising costs to hire front-line healthcare workers are likely to persist into the foreseeable future. To respond, providers will seek opportunities to boost the efficiency of existing staff members. By automating routine tasks, such as enabling patients to self-schedule appointments and automating the delivery of cost estimates, providers can free staff members to spend more face-to-face time with patients, which increases job satisfaction and improves the patient experience.
A greater focus on security: The cost of data breaches in healthcare, on average, exceeds those of any other industry, which makes it critical for healthcare organizations to focus intently on security and compliance to protect patient data. For providers, managing the risks associated with handling sensitive payment data is one of the most significant challenges of transaction processing. Providers need to ensure that their patient payment platforms deliver comprehensive risk management and security in a scalable form.
More price transparency: With Americans’ out-of-pocket responsibility remaining high, it will be essential for providers to offer patients digital tools that deliver more flexible payment options. Technologies such as pre-service cost estimates and proactive post-service payment plans increase transparency for patients and improve their ability to pay. Providers benefit from higher collection rates and patients get more transparency and flexibility.
Despite some ongoing challenges in 2024, providers can take steps to minimize potential roadblocks. By increasing patient self-service options where possible, focusing on price transparency, and adopting flexible, next-generation payment methods, providers will be well-prepared to tackle whatever obstacles the new year brings their way.
Ryne Natzke is Chief Revenue Officer for TrustCommerce, a Sphere company.