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A new PwC HRI report reveals that next year healthcare leaders will face a call to action-especially on progress and returns on the path to the digitization of the industry.
In 2020, healthcare leaders will face a call to action-especially on progress and returns on the path to the digitization of the industry, according to a new report.
The report, “Top Health Industry Issues of 2020,” from PwC Health Research Institute (HRI), found that while the U.S. healthcare industry has been moving toward digital for years now, 2020 is the year the industry should begin to see returns on these significant investments.
In 2019, PwC’s HRI issued an online survey of 3,563 U.S. adults representing a cross section of the population in terms of insurance status, age, gender, income, and geography. HRI also oversampled to obtain data on specific market segments. The survey collected data on consumers’ perspectives on the healthcare landscape and preferences related to healthcare usage.
HRI also surveyed 300 provider executives, 100 payer executives, and 100 pharmaceutical and life sciences executives. The survey collected data on executives’ perspectives on opportunities and obstacles in the healthcare industry and strategies for moving forward.
In addition, HRI conducted more than a dozen interviews with healthcare leaders to gain their perspective on the findings.
“The data are there, the tools and tech are available, however only 21% of healthcare companies employ a chief digital officer, compared to 32% of banking firms and 41% of insurance companies,” says Ben Isgur, PwC Health Research Institute leader. “Healthcare organizations should be generating an ROI on digital by now or they will need to double down on their efforts.”
In addition to the call to action around digital, this year’s “Top Health Industry Issues of 2020” report examines the novel ways health organizations are preparing for a looming tsunami of high prices; the upcoming 2020 election; the benefits to consumers of the industry’s digitalization push; the tax risk of innovation overseas; transformative deals and the growing need for diversity and inclusion in health organizations.
The PwC HRI report outlines pressures that healthcare executives must tackle in 2020:
• Healthcare executives are feeling the building pressure of rising costs and while there are many strategies to make healthcare more affordable, many organizations are failing to use these strategies. “For example, only 50% of provider executives offer payment plans without interest. 2020 will call for new payment plans and models,” Isgur says.
• 2020 is an election year and healthcare executives should expect continued focus on issues like Medicaid expansion, pricing transparency and drug costs. “Most of the immediate action will be at in the states as they continue to wrestle with coverage and affordability issues,” Isgur says.
• Consumers are ready to see the benefits of sharing their own health data, and companies will need to manage access and at the same time protect the data. 94% of payer executives cited ensuring privacy as a top concern.
• Healthcare companies will look toward growing overseas and investing in technology in 2020. Eighty-five percent of the top U.S.-based for-profit provider companies, tax-exempt provider organizations, payers and life sciences companies are operating overseas, so how companies deal with tax barriers and advantages will be a top priority.
• Healthcare executives will also be weighing deal options with a strategic lens, with the priorities being access to new markets, the ability to remain competitive in the United States, and access to new technology.
• Equity and inclusion are intersecting with every aspect of healthcare including research, treatments, and delivery. While only 8% of healthcare organizations said the primary objective of their diversity, equity and inclusion initiatives is to respond to customer expectations and needs, executives will feel the pressure to change and gain patient loyalty and trust.
“What may surprise some is that our research found that payer, provider, and pharma executives cited digital upskilling and emerging technologies as their top workforce priority for 2020, with 26%, 33%, and 26% respectively,” Isgur says. “The lack of analytical talent is a significant barrier to monetizing data.”
Based on the study, Isgur says there are three takeaways healthcare executives should be aware of.
First is the data.
"The U.S. health industry is full of data and companies and leaders alike need to be wary of getting ahead of themselves," he says. "They need to consider the need to safeguard information and ensure that they account for patient interests. Leadership will be important here. Just 21% of healthcare companies employ a chief digital officer, compared with 32% of banking companies and 41% of insurance companies."
Next are the high prices. Companies will need to seek creative ways to finance care, spread risk and ensure that their money is paying for value, he says. With groundbreaking treatments costing millions, payers must prepare a smart growth strategy to help lessen the financial burden.
In a survey of provider executives in 2019, HRI found that many systems are failing to use strategies to help consumers pay for their health. While 77% of health services providers direct patients to lower-cost care options, only 40% address the social determinants of health, and 7% offer loans, he adds.
Lastly are diversity and inclusion.
"In 2020, health companies will align diversity, equity and inclusion initiatives with business goals and identify blind spots that are compromising their abilities to achieve the mission of providing equitable access to lifesaving care," he says. "Only 8% of healthcare organizations responding to a 2019 global PwC survey said the primary objective of their diversity, equity and inclusion initiatives is to respond to customer expectations and needs. But that’s exactly what healthcare companies need to do as they compete harder to gain patient loyalty and trust. They should seek to expand their programs beyond focus on representation to include specific inclusion and equity objectives that change how their mission is carried out."