Healthcare CFOs Focused on Cost Management and Operational Issues, Survey Finds

Healthcare CFOs are facing increasing challenges when it comes to managing costs and operations, according to a recent survey conducted by the Healthcare Financial Management Association (HFMA). The survey, which included responses from 135 health system CFOs, found that just under 60% of respondents identified cost management and operational issues as their top “pain points” for 2024.

This focus on cost management and operations has been steadily increasing over the past few years, with the same item topping the list in a similar survey three years ago, but at that time only named by 32% of respondents. Breaking down the broad category of “cost management & operations,” the researchers found that revenue cycle management was the largest slice of the pie at 24%, followed by operations expenses at 18% and cost management at 17%.

The survey also highlighted other key findings, including the fact that higher labor costs are the number one cause of margin pressure for healthcare organizations, with 96% of respondents citing this as a significant issue. Additionally, the survey found that labor shortages, particularly among RNs, were causing significant margin pressure for hospitals.

Despite these challenges, the survey also revealed some positive trends, with 54% of respondents reporting positive margins and 82% of health systems experiencing higher denial rates from payers than before the pandemic. However, only 39% of CFOs expect AI to help cut costs, and almost 20% have stopped accepting at least one Medicare Advantage plan.

In response to these findings, the report authors noted that health systems are increasingly frustrated with Medicare Advantage due to onerous authorization requirements and high denial rates. The full report, titled “HFMA Health System CFO Pain Points 2024: Margin Challenges & Opportunities for Vendors,” is available for purchase for those interested in learning more about the challenges facing healthcare CFOs in the coming year.