Three-Times More Hospitals Have Deployed Automation Technologies Since 2020, Guidehouse/HFMA Analysis Shows

By AIT News Desk On May 28, 2021

Gaps in Cybersecurity, Enterprise Resource Planning Reveal Opportunities to Optimize Technology and Corporate Services Spend

The number of hospitals and health systems using automation technologies has tripled over the past year, according to a Guidehouse Center for Health Insights analysis of an executive survey conducted by the Healthcare Financial Management Association (HFMA).

“Underperforming or underleveraged ERP assets, for instance, significantly slow down operations, productivity, and employee engagement. In many cases, providers are not taking full advantage of the benefits their technology investments offer to solve their greatest business challenges – and it’s working against them in terms of efficiency and security.”

Half of executives said their hospitals are actively monitoring the use of automation technologies to improve accuracy and reduce costs, results show. Of them, 38% are driving positive results from automation investments while expanding associated capabilities. A March 2020 Guidehouse/HFMA analysis found that only 15% of hospitals had automated their corporate services functions.

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The 2021 Health IT & Corporate Services survey of 112 provider chief financial officers and operations executives also found that 37% of respondents cited intelligent automation, including robotic process automation (RPA), as their top technology enhancement priority over the next 12 months, followed by cybersecurity (30%) and enterprise resource planning (ERP – 27%).

The federal government, including the Office of the National Coordinator for Health IT, has taken significant regulatory steps to improve interoperability so that providers can easily and securely exchange data and automate technologies for internal and external purposes. Yet, obstacles remain for providers in fully leveraging their technology assets.

For example, when asked their top priority for improving cybersecurity, 43% cited using modern security technology to monitor network and device anomalies. However, only 1% cited tracking technology assets and just 9% cited removing legacy software, both critical to understanding current assets, their owners and users, and when they need to be updated. As health systems have undergone mergers and acquisitions, many have layered on new technologies instead of replacing the old ones – a common driver of insecure assets and cybersecurity threats.

Additionally, while a top priority, 45% of providers are still more than two years away from deploying ERP technology, with 15% suggesting they have no ERP plans, up from 9% a year ago.

“Operationalizing technology represents a significant opportunity for providers to drive efficiency gains, especially in corporate services,” said Guidehouse Partner and Health IT solutions co-leader Subra Sripada, a former health system chief information officer. “Underperforming or underleveraged ERP assets, for instance, significantly slow down operations, productivity, and employee engagement. In many cases, providers are not taking full advantage of the benefits their technology investments offer to solve their greatest business challenges – and it’s working against them in terms of efficiency and security.”

According to Bill Jones, Guidehouse partner and Managed Services leader, “We’ve observed a sharp increase among providers in evaluating automation as a cost-reduction strategy, including organizations lacking the resources needed to deploy the technology themselves. For these providers, leveraging vendor partnerships and outsourced services is a strategic investment to successfully achieve economies of scale and realize the benefits of automation.”

More Efficient Corporate Services Spending

The survey also suggests providers are spending more wisely on corporate services. According to results, 21% of executives believe their corporate services spending could decrease by 10% or more without negatively impacting quality or efficiency, down from 36% in 2020.

In addition, more than half of executives surveyed expect to be held accountable for reducing corporate services budgets (25%) or, at a minimum, holding them flat (27%) over the next year. To do so, providers are targeting the supply chain, IT, and revenue cycle management as top priority areas for reducing corporate services expenses this year.

“The pressure for health systems to transform financial and operational performance has intensified with the pandemic,” said Michele Mayes, Guidehouse partner and Operational Effectiveness solutions leader. “While the supply chain and revenue cycle are key areas to target, optimizing technology assets like automation is essential for providers to drive corporate services efficiencies that create a more resilient future. The technology itself won’t solve the problem but wrapping better processes and structure around an optimized solution will.”

COVID-19 Impact on Staffing Shortages

It’s clear the COVID-19 pandemic has dramatically impacted shortages of frontline clinicians. Compared to a year ago, 69% of executives said nursing shortages have worsened, with 32% citing an increase in behavioral health shortages. Just 20% of executives suggested an increase in physician shortages, potentially due to suspension of elective procedures across the country.

The survey analysis was produced by the Guidehouse Center for Health Insights, which provides a complete view of healthcare payment, operations, and consumer disruption insights and solutions. With 11 KLAS #1 rankings, the Guidehouse Health team helps hospitals and health systems, government agencies, life sciences companies, and payers strategically redesign, revitalize, and transform their operations.