Expectations are high for digital change that will reinvent the healthcare industry. But a recent study shows hard work lies ahead before providers and payers can reap the value of the next generation of healthcare services.
Healthcare is in dire need of modernization, and the digital transformation will drastically improve the industry value chain. But for that to happen, healthcare leaders must prepare for the work ahead and dare to invest in ground-breaking digital initiatives.
A study by Cognizant and Roubini Global Economics, which surveyed more than 2,000 executives globally (including approximately 350 healthcare leaders), shows that businesses from all industries stand to make significant economic gains by going digital. But so far, 76 percent of payers and providers in the healthcare industry have not been able to cut costs by using digital technology.
“While it may sound counter-intuitive, fixating on cost savings won’t be enough,” says Robert Brown, associate VP of Center for the Future of Work at Cognizant. “But if handled properly, digital change will start both creating revenues and cutting costs in healthcare.”
Through 2018, respondents expect healthcare costs to decrease by 2.4 percent – more than most industries – and the revenue impact from digital to double, with an 11 percent improvement to the top and bottom lines.
“Expectations for the next few years in healthcare are huge, digitally speaking,” says Patricia Birch, SVP of Healthcare and Life Sciences consulting practice at Cognizant. “But digital is not some sort of magic wand. Payers will need to place big bets on digital, automation and platform strategies to be able to compete with new, ‘born-digital’ entrants.”
The survey shows automation will be the leading digital force that will transform the industry. As tasks are automated, work will become more strategic and effective.
“Healthcare professionals will not be replaced by robots. Instead, by automating repeatable tasks, for example, they will have more time to provide actual healthcare,” Birch points out.
One of the biggest threats of the digital age to businesses in general is that of data breaches. Healthcare providers already have access to large amounts of personal data, and much more will be generated by automation and artificial intelligence. Thus, it is no surprise that 90 percent of payers list data security as their top concern. Keeping patient and medical data safe will be paramount for healthcare providers.
On the digital way forward for healthcare, strong leadership is essential. Executives must be willing to invest in new initiatives, encourage innovation and prioritize hiring and harnessing new categories of talent.
Download the report at thecognizant.com to learn more about the changing nature of business in the digital economy.
