Count health care CFOs among those whose business and financial prospects have soured since the start of this year.
Queried by the Deloitte Center for Health Solutions late last summer, finance leaders at health systems and health plans were expecting 2025 to be a year of growth. About seven in 10 respondents anticipated gains in both revenue and profitability.
Fast forward just a few months to this spring, and the script had flipped. Among 32 health systems and 32 health plans, 73% reported revenue growth and operating profitability as being among their top organizational concerns.
Even greater proportions of those polled rated external concerns among their chief issues. For example, 81% cited business conditions, such as the impact of potential health care regulatory and policy changes, the current economic situation and supply chain disruption.
As to regulatory and policy issues, both groups of survey participants cited tariffs/trade policy changes and Medicaid reform among their top concerns. Notably, Deloitte’s study was conducted prior to passage of the latest budget reconciliation bill, which could have even further ramifications for Medicaid reimbursement.
“Prescription drugs, medical equipment and other medical supplies account for about 20% of the average hospital’s expenses — and a large share of these items are imported,” Deloitte wrote in its survey report. Potential new tariffs on these imports could increase such costs by 15% or more, according to the report.
However, on the health plan side, CFOs identified potential changes to drug pricing policy as the single most important regulatory/issue. For example, key provisions of the Inflation Reduction Act, signed into law in 2022, include capping out-of-pocket drug costs at $2,000, eliminating the coverage gap known as the “donut hole,” and shifting a greater share of catastrophic drug costs from the government to health plans.
Evolving consumer needs, another group of external issues, was a top concern for 81% of survey participants. These included the affordability of health care and consumer engagement and trust.
Such external concerns have supplanted workforce challenges, cost reduction and cybersecurity, all of which had ranked among health care finance leaders’ top priorities for at least four of the previous five years. Deloitte suggested, though, that health care leaders should not fall into complacency on these internal issues.
While workforce concerns appear to have stabilized, some of them remain, such as clinician burnout and low employee trust in health care leadership, according to Deloitte.
“Cost concerns have also waned, with finance leaders now focusing more on growth, although monitoring costs can be important given ongoing policy and technology changes,” Deloitte wrote. Similarly, cybersecurity has dropped in priority, even as cyber threats continue to rise.
“Overlooking these internal issues could become a blind spot, especially as health care organizations pursue innovation and growth in an increasingly complex environment,” Deloitte counseled.