- Leaders at hospitals and health systems across the country are anticipating a potentially turbulent operating environment in the coming year, according to a survey from Deloitte.
- Among health system leaders, 85% said staffing challenges would have a major impact on their 2023 strategy and 76% said inflation is a significant factor. Other expected headwinds include affordability issues for patients, shrinking margins and continual supply chain disruptions.
- Deloitte also polled health plan executives and found they face challenges related to inflation and a tight labor market, though are generally in a better financial position than hospitals and health systems.
Hospitals are still being impacted by the COVID-19 pandemic, with staffing shortages and burnout continuing to pose major challenges to systems. Inflation and heightened expenses have hurt hospital margins, and are expected to continue into next year.
That’s causing some concern to healthcare executives, according to Deloitte’s survey, which included responses from 71 executives at both health systems and health insurance companies with revenue over $500 million.
Among health system executives, 37% said they feel cautiously positive about the coming year, while 32% said they feel negative. Only 5% of respondents said they feel positive.
Among health plan executives, 43% said they feel cautiously positive and 23% said they felt positive, while just 3% said they feel negative.
Inflation has not yet fully hit payers, as they are typically locked into contracts with providers that stipulate rates for several years. That will change in the coming years as more contracts are able to be renegotiated.
Labor expenses have been rising for hospital systems, and facilities are focused on remedying staffing woes in the coming year, as systems face widespread burnout and heightened turnover.
Nearly 90% of respondents said investing in their workforce next year was important or very important.
Another recent report from Fitch ratings found staffing shortages at nonprofit hospitals appear to be easing incrementally, pointing to consistent job gains for hospitals and ambulatory service providers this year in reports from the Bureau of Labor Statistics.
The ongoing pandemic and more cases of influenza and RSV are causing capacity issues that pose a major near-term risk to labor costs, however, that report said.