In 2024, healthcare CFOs are spearheading transformative initiatives to navigate challenges and capitalize on opportunities in the evolving landscape of healthcare finance. The “2024 Healthcare CFO Outlook Survey” conducted by BDO highlights CFOs’ optimism tempered by the acknowledgment of regulatory pressures and liquidity concerns. Strategic priorities include optimizing revenue cycle management, embracing technological advancements such as AI, and pursuing strategic partnerships. This proactive approach aims to enhance operational efficiency, drive revenue growth, and ensure resilience in the face of uncertainty.
Amidst the dynamic healthcare landscape, 2024 emerges as a pivotal year where financial leaders in the healthcare sector are poised to drive innovation and adaptation. The “2024 Healthcare CFO Outlook Survey” conducted by BDO provides insights into the strategic priorities and outlook of CFOs from diverse healthcare organizations. While optimism abounds regarding revenue growth and profitability, CFOs also grapple with regulatory complexities and liquidity challenges. Against this backdrop, CFOs are embracing a proactive stance, prioritizing revenue cycle management, leveraging AI, and exploring strategic partnerships to navigate uncertainties and propel their organizations towards sustainable growth.
However, amidst this optimism, there exists a sober acknowledgment of the hurdles ahead. Regulatory pressures, the retraction of COVID-19 funding, and the intricacies of bond and loan covenant agreements pose significant challenges. Notably, 11 percent of CFOs admit to breaching these agreements in the past year, with concerns looming over potential violations in the future. Moreover, liquidity concerns come to the fore, with only 35 percent of organizations boasting more than 60 days of cash on hand. Consequently, 44 percent of CFOs stress the need for strategic discussions regarding economic resilience.
In response to these challenges, healthcare CFOs are adopting a proactive stance, realigning strategies, and investing in transformative initiatives. Revenue cycle management assumes a pivotal role, with 39 percent of CFOs focusing on optimizing processes to bolster liquidity. Strategic cost reductions, including staffing adjustments, are also on the agenda for 37 percent of respondents, reflecting a concerted effort towards operational efficiency. Additionally, 34 percent of CFOs are spearheading initiatives to transform operating models, underscoring a shift towards agile and adaptive frameworks.
Brad Boyd, national co-leader of the BDO Center for Healthcare Excellence & Innovation, emphasizes the imperative of cash flow management, cost optimization, and risk mitigation to safeguard patient care amidst industry turbulence. This strategic recalibration extends to embracing technological advancements, with AI and robotic process automation heralding a new era of efficiency and innovation in revenue cycle management. By streamlining roles, workflows, and post-payment audits, AI promises to unlock operational efficiencies and minimize revenue leakages.
Of particular excitement are advancements in generative AI, which hold the promise of revolutionizing healthcare finance. A staggering 98 percent of CFOs are currently piloting generative AI, with 46 percent venturing into proprietary platforms. These investments underscore a broader commitment to harnessing technology to drive front- and back-office enhancements. From digital patient-provider communications to remote care delivery, generative AI finds applications across various domains, including treatment planning, diagnostics, and medical imaging.
Furthermore, technology investment extends beyond AI, encompassing predictive staffing, financial reporting software, and enterprise data analytics. The survey highlights a strategic shift towards digitization, with 45 percent of respondents increasing investments in patient-provider communication platforms and 44 percent prioritizing remote patient care solutions. These investments not only enhance operational efficiency but also enrich the patient experience, laying the foundation for sustainable growth and resilience.
Amidst the drive for innovation, dealmaking emerges as a key priority for healthcare CFOs in 2024. However, navigating the intricacies of due diligence, identifying suitable targets or buyers, and addressing valuation disparities present formidable challenges. Despite these hurdles, nearly three-quarters of CFOs remain committed to pursuing strategic partnerships and acquisitions, underscoring a proactive approach towards growth and diversification.
In closing, the landscape of healthcare finance in 2024 reflects a delicate balance between optimism and pragmatism. CFOs, cognizant of the challenges ahead, are leading the charge towards transformation, armed with strategic insights and innovative solutions. By prioritizing revenue cycle optimization, harnessing the power of AI, and forging strategic alliances, healthcare organizations are not merely adapting to change but shaping the future of healthcare finance. As they navigate the complexities of the healthcare ecosystem, CFOs remain steadfast in their commitment to driving efficiency, fostering growth, and ensuring resilience in an ever-evolving landscape.
