Overview
Ground-shifting changes are coming to healthcare. Our recent survey of health system chief executive officers (CEOs) and chief strategy officers (CSOs) indicates that their most critical priorities will be navigating the changing regulatory environment, managing against significant expected financial pressures, retaining and growing their patient base, and recruiting and retaining physicians and clinicians.
While regulatory, financial, workforce, and consumer pressures are expected to materially rise, executives also see the potential promise of technological advancements to improve the caregiver experience and enable new ways of delivering more accessible, cost-effective care. Yet to realize this promise, they will need to make significant investments amid other potentially more pressing pulls on capital and resources—such as investment in assets and the clinical workforce to increase access.
Who we surveyed
In December 2024, we surveyed 61 senior strategy executives at US health systems with an annual revenue of $1 billion or more. They shared what they think about key healthcare trends, what keeps them up at night, and where they are making strategic investments for the future.
Note: Responses by health system size and financial strength did not vary significantly.
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Executives expect material changes in the next 5 to 10 years
Health system leaders anticipate big changes—driven by the regulatory environment and key advances in healthcare technology.
This survey was conducted in December 2024—post-election but before the Trump Administration began enacting executive orders and appointments. On top of the most recent potential changes to the regulatory environment, it is worth noting that for more than a decade, federal and state regulations related to managing healthcare costs were on the rise.
The Centers for Medicare & Medicaid Services (CMS) has led the charge through its various mandatory episode-based alternative payment models (e.g., BPCI, CCJR, and TEAM to be launched in January of 2026) and Medicare Shared Savings Programs (MSSP). In addition, some states (e.g., Rhode Island, Iowa, Texas, Illinois, Indiana, and California) have enacted forms of pricing reviews and regulations.
While these regulations are understood to have a negative financial impact on health systems, our survey showed that they are also expected to have a materially negative impact on provider experience.
The impact of rapidly changing regulations remains uncertain—with the greatest anticipated burden on provider experience.
Closely tied to regulatory changes, payment reform (across both public and private payers) is also expected to negatively impact provider experience, while positively impacting quality and safety, affordability, and health equity.
Health system leaders believe technological advancements have the potential to offset some of these challenges.
In contrast, executives view technological advancements—particularly artificial intelligence (AI) such as machine learning and natural language processing (NLP), remote patient monitoring (RPM), wearable health devices, and other telehealth expansion—as an essential part of navigating these industry changes. They are hopeful that these advancements will have a significantly positive impact on access, patient experience, and provider experience.
Most health systems are focused on a common set of priorities that will help them address today’s challenges while repositioning for the changes at hand
At an enterprise and industry level, health system leaders realize the imperative to invest in these macro trends that will fundamentally change the US healthcare delivery ecosystem. They are particularly focusing on technology and increasing alignment with physician leaders, given their critical role in advancing healthcare.
Given the margins required to invest in future capabilities and technologies to advance healthcare, executives said the most critical priorities to generate growth and margin in the next 5 years were workforce development and retention, and patient retention.
Yet this No. 1 priority is also the biggest anticipated challenge.
Recruiting and retaining the clinical workforce—especially physicians—is a consistent top priority and challenge for health systems, though only by a narrow margin. Executives recognize multiple significant challenges to overcome as they navigate the environment today and reposition for the future.
Health systems’ investments reflect their mission-centric priorities amid financial pressures
In the immediate term, 2025 investments prioritize the building blocks for sustainably providing care in an uncertain environment, with a focus on developing outpatient sites of care to provide more convenient and affordable care.
Additionally, if gifted $1 billion, most health system executives again would invest in expanding current services and sites of care.
To navigate these uncertain times, health system executives have made enabling growth through improved operations and financial performance their top priorities. Areas of focus include lowering operating costs, improving access, improving revenue cycle performance, and increasing provider capacity—all “no-regrets” strategies.
Growth in uncertain times
The future holds much uncertainty about how regulations, policies, and technological applications in healthcare will unfold. Bolstering core operations to generate margin, creating agile leaders and processes to adapt quickly to the changing landscape, engaging physicians and the clinical workforce to co-develop solutions, and creating a seamless experience for patients will be key. More than ever, health systems will need to focus on big, audacious goals that are rooted in their core values and purpose to chart the path for the next 10 years.
