MedCity Influencers, Health IT

Why back-office systems are more critical to healthcare providers today than ever before

While healthcare providers have invested heavily in clinical systems over the past decade, they’ve mostly ignored financial and operational systems.

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The financial plight of healthcare providers amid the Covid-19 pandemic makes it more imperative than ever for HCPs to modernize their back-office systems in order to improve visibility and efficiency across their finance, supply chain, and HR operations.

Mid-2020 estimates by the American Hospital Association projected that U.S. hospitals would post combined losses of about $323 billion for the year, due in part to Covid-related expenses and revenue losses from canceled surgeries and other services. Some 28% of U.S. hospitals reported losing money as of November 2020, according to Strata Decision Technology. Hospital admissions in 2020 were down 10.5% from 2019, according to Kaiser Family Foundation.

While HCPs have invested heavily in clinical systems over the past decade, they’ve mostly ignored financial and operational systems. Even as hospitals, ambulatory care centers, and independent private practices consolidated to benefit from economies of scale, in many cases they failed to realize that goal because of their lack of enterprise-wide visibility. And while federal incentives have pushed the industry toward a value-based care system, prioritizing health data availability and quality patient care, this move has not translated to improved efficiencies.

“Consumer-facing and care model digital transformations have drawn a lot of the attention amongst health system executives, but what we often find is that when you develop the business cases around a transformation initiative, back-office digital transformation often rises to the top because of the high ROI and (relative to consumer or care model transformation) less complicated execution requirements,” says Tom Kiesau, senior partner and leader of the Chartis Group’s, Chartis Digital business.

Retooling the HCP back office
How can HCPs stanch the financial bleeding while ensuring sufficient inventories of essential medical supplies and adequate staffing to serve their communities? And how can they prepare for financial resilience during future uncertainties?

In our view, they need to invest in their finance, supply chain, HR, and other back-office systems. The pandemic has made clear that patient care, organizational strategy, operations, and financial management are tightly intertwined—one cannot respond to challenges in one area without affecting the other. HCP finance, HR and supply chain leaders own extremely important levers to ensure that the highest quality of patient care is available. The importance of drawing insights from operational data to improve planning and speed decision making has been brought into sharp focus throughout this crisis.

The road to success
HCPs need a comprehensive, single source of operational data (Figure 1 below), which they can slice and dice to answer, “What if?” questions in order to address dynamic challenges and scenarios. These insights allow them to identify and correct problems before they occur. Most important, improved information management frees up clinicians to spend their time doing what they do best: taking care of their patients.


Fig 1: Make your data work for you


Business intelligence tools are essential to helping HCPs improve their finances (Figure 2) while addressing their staffing and retention challenges. Under normal circumstances, HCPs are typically understaffed, forcing them to spend significant time and money on recruiting and retention efforts. During the pandemic surge, however, hospitals have had to furlough staff while paying contract critical-care clinicians two to three times their regular rates in a “rob Peter to pay Paul” staffing situation.

Fig 2: Generate business insights



Universal financial visibility is the first step to understanding the true costs of HCP services—by physician, service, encounter, and patient population—a requirement outlined in MACRA (Medicare Access and CHIP Reauthorization Act), passed in 2015. HCPs need this granular information to understand resource utilization and cost trends over time so that they can identify opportunities to cut costs and make future investments. A non-profit integrated health system serving more than 800 communities was able to use just this type of a bottoms-up data-first approach to ensure consistency across finance applications, reporting, analytics, and other systems.

At a time when HCPs are frontline warriors against a relentless pandemic, we need to ensure that they’re armed with the best weapons so that their focus remains steadfast on the pandemic response and not so much on the health of their businesses.

Photo: shylendrahoode, Getty Images


Smriti Khera is Director, Healthcare and Life Sciences, Cloud Applications - Oracle. Smriti has 15 years of experience working in the healthcare and life science industries and a Ph.D. in Pharmaceutical Sciences from the University of Arizona in Tucson. During her career, she has led site-wide modernization of shared instrumentation and software infrastructure, owned and managed capital budgets, led investigations into drug candidates, drug substance, drug product and packaging, developed strategies to improve market share and top line revenue of scientific instrumentation, and brought many new solutions to market from concept to commercialization. At Oracle, her focus is to maintain a birds’ eye view of the healthcare ecosystem and build meaningful marketing programs that increase the awareness of Oracle Cloud solutions and the benefits of digitization across healthcare and life sciences enterprise. To learn more about how Oracle supports Healthcare and Life Sciences, please visit:

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