Technology leads hospital expenditures
Hospitals are continuing to make big investments in technology as they recognize the need to effectively manage population health, according to C-suite execs polled for Premier's Fall 2015 Economic Outlook survey.
More than 64 percent of respondents reported an increase to capital budgets this year, reflecting the need for investments in advanced technology to meet value-based care goals. In fact, 39 percent of these respondents increased their budgets by at least 10 percent.
The biggest investment for hospital expenditures is on health information technology, according to 72.2 percent of respondents to the survey.
"Investments in HIT, data analytics and modern clinical infrastructure are foundational for providers to seamlessly deliver population health services across their inpatient, outpatient and alternative care sites," said Michael J. Alkire, chief operating officer of Premier, in a press statement.
"Increasing capital budgets are a positive indicator that health systems are better equipped to invest in building and wiring care centers that can meet these new demands," he added.
Budget increases reflect a greater focus on healthcare providers' needs for greater patient engagement, with almost 55 percent of respondents looking to increase these capabilities over the next three years. Additionally, nearly half of respondents will expand their budgets to focus on health data analytics.
The Affordable Care Act is another driving force behind increased budgetary expenditures, which requires hospitals to increase spending during the transition to alternative payment models.
"The enactment of the Affordable Care Act brought reimbursement cuts and increased pressure on health systems to tightly manage budgets," said Alkire.
"The shift requires that health systems make new investments in infrastructure and high-value care networks to deliver better outcomes, as well as manage risk-based contracts and less reimbursement," he added.
As they put money into tools for patient engagement (54.7 percent), chronic care management (53.8 percent), wellness programs (51.9), patient outreach and reminders (47.2) and advanced analytics (46.3 percent) hospitals are recognizing the increased need for population health management and are making the necessary monetary adjustments to support the change, according to Premier.