Digital health solutions boost efficiency, though ROI is yet to come

Photo: Al David Sacks/Getty Images

As COVID-19 hits its four-year anniversary, healthcare has seen the potential to transform through digital health solutions – including the ability to help reduce nursing shortages, expedite patient care, minimize in-person costs and create more productive collaboration with insurance companies.

According to Ernst and Young's inaugural Health Pulse Survey, 71% of healthcare executives say the implementation of new technology has not decreased overall hospital expenses. That means, essentially, that the ROI isn't there yet.

Yet nearly all executives within the sector (96%) believe that the initial financial investment of new technology is worth the cost.

The survey polled more than 100 payer and provider executives throughout the U.S. to reveal how health systems have adapted since COVID-19, the strategic investments they have made in digital health and how these investments have impacted their bottom line.

WHAT'S THE IMPACT?

The onset of COVID-19 acted as a catalyst for the healthcare industry, driving a growing interest in digital health solutions within hospitals and health systems, the survey found.

From tech investments to a newfound focus on generative artificial intelligence, the appetite for digital health solutions has risen, and efficiency has increased. Nine in 10 executives in the healthcare sector (90%) indicate their department has more time to handle the needs of providers after shifting administrative responsibilities to a digital system.

More and more hospitals and health systems are integrating AI into processes, with 60% of healthcare executives actively investing in AI-based applications – and identifying it as a transformative force. A majority – 96% of respondents – witnessed a substantial reduction in wasted time and financial costs.

Further, 93% of executives have seen emerging tech as an asset for providers by supporting tech-driven administrative efficiencies, allowing nine of 10 departments to prioritize provider needs as they shift to operational tech.

Despite the majority investing in digital health solutions, the industry reward has been elusive. Eighty-six percent of respondents acknowledge the potential cost reduction through digital health solutions, but seven in 10 have yet to see any ROI to date. Fifty percent of healthcare executives believe this constrained ROI is amplified by siloed tracking metrics, making it difficult to successfully monitor tech's initial cost value to the practice.

Amid the shift to emerging technology, the demand for tech-savvy professionals in digital healthcare skyrocketed, with 94% of executives agreeing that newer technologies raise providers' credibility. To meet this demand, 90% of executives are investing more money in staffing their digital tech teams.

THE LARGER TREND

In October, Moody's Investors Service predicted the credit quality future of artificial intelligence in a webinar entitled, "AI and credit quality: Opportunities and challenges for non-financial corporate issuers."

At a high level, the overall credit impact is positive. 

In the healthcare sector, AI is expected to have little credit quality impact over the next two years, and then have a low impact from 2026 to 2030, said Francesco Bozzano, vice president and senior analyst for the corporate finance group at Moody's.
 

Jeff Lagasse is editor of Healthcare Finance News.
Email: jlagasse@himss.org
Healthcare Finance News is a HIMSS Media publication.