Cost reduction remains a top priority for CFOs in health systems, as highlighted by a Deloitte survey. It's the primary area that CEOs have urged them to focus on, demonstrating the urgency to drive efficiency in healthcare organizations. However, Deloitte warns that many health systems may be concentrating too much on traditional approaches, while overlooking "high-impact drivers" that could be catalysts for increased profitability.
The Deloitte Center for Health Solutions recently surveyed over 60 CFOs from U.S. health plans and health systems, sharing the insights in a report with Becker's. Their findings revealed a critical need for innovative profitability drivers, especially as traditional solutions have yielded diminishing returns in recent years. To navigate the challenges posed by inflation and a dynamic macro environment, healthcare finance leaders must consider alternative avenues for enhancing profitability. Some of these levers, often underutilized, include digital transformation and service model optimization, which can be highly effective.
While these transformative strategies may be lower on the radar of financial leaders, they hold significant potential. Below, we present the profitability drivers CFOs have prioritized and those they may have yet to fully embrace, according to the Deloitte survey:
CFOs' Top Priorities:
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Improved Revenue Cycle — Prioritized by 52 percent of executives
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Addressing Talent Issues — Given high importance by 48 percent of CFOs
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Strengthening Supply Chains — Considered crucial by 45 percent of financial leaders
Untapped High-Impact Drivers:
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- Optimizing Service Model — Embraced by 42 percent of CFOs
- Increased Payments — Recognized by 42 percent of financial executives
- Care Delivery Transformation — Acknowledged as a high-impact driver by 29 percent of CFOs
- Investing in Digital Transformation — Considered a priority by 26 percent of healthcare finance leaders
Besides deploying broader organizational strategies to reduce costs, CFOs are also exploring transformations within their own finance departments. The surveyed CFOs are looking into finance transformation approaches, such as optimizing cost allocations, benchmarking cost improvements, embracing analytics-led cost recovery, and implementing agile liquidity management. These strategies are seen as essential areas of focus for achieving greater efficiency.
As health systems navigate the ever-evolving landscape of healthcare finance, embracing innovative approaches, including robust Accounts Payable (AP) automation, can be a powerful profitability driver. AP automation streamlines payment processes, reduces operational costs, and minimizes the risk of errors, all of which contribute to enhanced efficiency and improved financial outcomes. By incorporating AP automation as a core component of their financial transformation, health system CFOs can unlock substantial cost savings and drive their organizations toward a more profitable future.
Discover the untapped potential of AP automation and its role in revolutionizing your health system's financial operations. At Nimbello, we're dedicated to helping healthcare organizations maximize their profitability through cutting-edge AP automation solutions. Contact us today to embark on your journey toward greater efficiency and profitability.