Marcus Perez
Four forces shaping healthcare in 2025
January 17, 2025
By Marcus Perez
In healthcare, no two days are alike. This makes it difficult to anticipate how the industry will change over the course of an entire year. That said, as we think about 2025, there are a number of drivers that are sure to shape the experiences of patients, providers and other players. Here are four factors that will propel the industry forward in the year ahead.
1. Using AI intelligently
For years, we have discussed the promise of AI across the healthcare industry, and 2025 is likely to be a turning point for these technologies. A year from now, as we look back on the progress made, organizations that make strategic investments in solutions that address their top challenges will fare better than those that adopt AI for AI’s sake.
Maintaining adequate staffing is one of those persistent issues many organizations still grapple with. Research suggests there may be a shortfall of approximately 95,000 physicians and 78,000 nurses in the year ahead. Given how hands-on healthcare is as a field, AI that assists or augments providers (rather than replaces them) will make the biggest impact.
For example, documentation requirements continue to place undue burden on providers, exacerbating burnout and causing “pajama time” documentation after hours. AI-powered technologies like ambient listening can sit in the background, enabling providers to have natural conversations with patients and reduce the need to manually document every data point. Similarly, AI can be used to summarize data and generate resources like pre-visit preparation notes to save time and help providers better focus on the needs of each patient.
2. Doubling down on data sharing
The healthcare industry generates approximately 30% of the world’s data, and in 2025, the compound annual growth rate for healthcare data is projected to reach 36%. But volume does not automatically equal value. If data cannot be exchanged effectively within or between organizations, many emerging technologies creating buzz will not live up to their potential. Additionally, inundating providers with a flood of disorganized data is likely to hasten burnout rather than improve decision-making.
In 2025, we are likely to see even more focus on where and how data is shared to drive toward full interoperability that will benefit patients, providers, organizations and the overall healthcare system. Wider adherence to standards and frameworks like FHIR and TEFCA will enable data to flow more freely so it follows patients wherever they receive care.
Data-driven healthcare organizations will not only work to improve interoperability, but they will also take steps to ensure providers and other players are presented with digestible, actionable information. Organizations that integrate and harmonize data from EHRs, remote patient monitoring devices, patient self-reported data and other sources will have a clearer path to improving outcomes in the year ahead.
3. Balancing budgets
Healthcare finance is often a balancing act as many organizations operate on thin margins, and this will continue into 2025. According to the American Medical Association, when adjusted for inflation, Medicare reimbursement for physician services has declined 29% from 2001 to 2024. At the same time, organizations are facing higher costs: drug and other supply costs rose by nearly 10% and labor expenses by 4% from July 2023 to July 2024. In light of these external pressures, healthcare organizations will need to focus heavily on achieving and maintaining financial stability this next year.
While clinician shortages have apparent and immediate repercussions for patient care, other departments are also dealing with staffing challenges that affect entire organizations. For example, a survey conducted through HFMA found that 25% of healthcare finance and revenue cycle leaders say they need to hire more than 20 employees to fully staff their department.
One trend we can anticipate is an increase in outsourcing some or all revenue cycle functions. In fact, one HFMA survey found that more than one-quarter of health systems are planning to do so. Whether leveraged on a temporary or ongoing basis, outsourcing will enable organizations to keep cash flowing amid staffing shortages.
Automation will also be key to effective revenue cycle management in 2025. Automating front-end functions like patient scheduling can help staff members dedicate more time to tasks that require the intervention of a human being and prevent bottlenecks that hinder patient access. Later in the revenue cycle, automation can support the human workforce by highlighting potential errors before claims are submitted to prevent denials and ensure organizations are fully reimbursed for the care delivered.
4. Favoring flexibility
It’s been more than 15 years since the passage of the HITECH Act, and while electronic health records (EHRs) are nearly ubiquitous today, positive sentiment over EHRs is not. One study conducted by Black Book found that 77% of EHR users face ongoing issues including cumbersome workflows and difficult navigation. From private practices to multifacility health systems, leaders have come to recognize that monolithic, one-size-fits-all EHRs are not meeting the needs of their organizations.
Enhancing EHR flexibility will be a major theme in 2025. Having options when it comes to EHR configuration, customization and personalization enables organizations to address the hospital’s or practice’s needs while accommodating the preferences of individual users. Those able to achieve a balance between ease of use, efficiency and effectiveness will see the greatest return on investment from their EHRs.
Another trend we can anticipate for 2025 is adoption of the cloud. Organizations will migrate to public cloud platforms in greater numbers to facilitate real-time data sharing so providers can reference the most current information available and enable technologies like AI to perform to the fullest extent. The cloud will also help minimize the persistent problem of EHR downtime as many cloud platforms store their data in multiple data centers, helping to maintain ongoing data access.
Forging ahead
It’s hard to believe we are halfway through the current decade. From the COVID-19 pandemic to sweeping regulatory updates, changes across the industry have had widespread, lasting effects. Unexpected events may lie ahead, but one thing is for certain. Making incremental, sustainable changes that prioritize patient outcomes and enhance the provider experience will bring next-level healthcare within closer reach.
About the author: As president of Altera Digital Health, Marcus Perez currently oversees all facets of a global healthcare IT software company that provides solutions for hospitals and health systems, as well as large physician practices. Marcus leads Altera Digital Health with a vision to make digital healthcare better every day by focusing on the Harris Core Values, driving to build an enduring organization. Marcus is a 1989 graduate of West Point and a Veteran, having spent more than a decade in the military as a helicopter pilot and instructor. He is an avid basketball coach and holds a Master’s Degree in Education, along with an MBA.
In healthcare, no two days are alike. This makes it difficult to anticipate how the industry will change over the course of an entire year. That said, as we think about 2025, there are a number of drivers that are sure to shape the experiences of patients, providers and other players. Here are four factors that will propel the industry forward in the year ahead.
1. Using AI intelligently
For years, we have discussed the promise of AI across the healthcare industry, and 2025 is likely to be a turning point for these technologies. A year from now, as we look back on the progress made, organizations that make strategic investments in solutions that address their top challenges will fare better than those that adopt AI for AI’s sake.
Maintaining adequate staffing is one of those persistent issues many organizations still grapple with. Research suggests there may be a shortfall of approximately 95,000 physicians and 78,000 nurses in the year ahead. Given how hands-on healthcare is as a field, AI that assists or augments providers (rather than replaces them) will make the biggest impact.
For example, documentation requirements continue to place undue burden on providers, exacerbating burnout and causing “pajama time” documentation after hours. AI-powered technologies like ambient listening can sit in the background, enabling providers to have natural conversations with patients and reduce the need to manually document every data point. Similarly, AI can be used to summarize data and generate resources like pre-visit preparation notes to save time and help providers better focus on the needs of each patient.
2. Doubling down on data sharing
The healthcare industry generates approximately 30% of the world’s data, and in 2025, the compound annual growth rate for healthcare data is projected to reach 36%. But volume does not automatically equal value. If data cannot be exchanged effectively within or between organizations, many emerging technologies creating buzz will not live up to their potential. Additionally, inundating providers with a flood of disorganized data is likely to hasten burnout rather than improve decision-making.
In 2025, we are likely to see even more focus on where and how data is shared to drive toward full interoperability that will benefit patients, providers, organizations and the overall healthcare system. Wider adherence to standards and frameworks like FHIR and TEFCA will enable data to flow more freely so it follows patients wherever they receive care.
Data-driven healthcare organizations will not only work to improve interoperability, but they will also take steps to ensure providers and other players are presented with digestible, actionable information. Organizations that integrate and harmonize data from EHRs, remote patient monitoring devices, patient self-reported data and other sources will have a clearer path to improving outcomes in the year ahead.
3. Balancing budgets
Healthcare finance is often a balancing act as many organizations operate on thin margins, and this will continue into 2025. According to the American Medical Association, when adjusted for inflation, Medicare reimbursement for physician services has declined 29% from 2001 to 2024. At the same time, organizations are facing higher costs: drug and other supply costs rose by nearly 10% and labor expenses by 4% from July 2023 to July 2024. In light of these external pressures, healthcare organizations will need to focus heavily on achieving and maintaining financial stability this next year.
While clinician shortages have apparent and immediate repercussions for patient care, other departments are also dealing with staffing challenges that affect entire organizations. For example, a survey conducted through HFMA found that 25% of healthcare finance and revenue cycle leaders say they need to hire more than 20 employees to fully staff their department.
One trend we can anticipate is an increase in outsourcing some or all revenue cycle functions. In fact, one HFMA survey found that more than one-quarter of health systems are planning to do so. Whether leveraged on a temporary or ongoing basis, outsourcing will enable organizations to keep cash flowing amid staffing shortages.
Automation will also be key to effective revenue cycle management in 2025. Automating front-end functions like patient scheduling can help staff members dedicate more time to tasks that require the intervention of a human being and prevent bottlenecks that hinder patient access. Later in the revenue cycle, automation can support the human workforce by highlighting potential errors before claims are submitted to prevent denials and ensure organizations are fully reimbursed for the care delivered.
4. Favoring flexibility
It’s been more than 15 years since the passage of the HITECH Act, and while electronic health records (EHRs) are nearly ubiquitous today, positive sentiment over EHRs is not. One study conducted by Black Book found that 77% of EHR users face ongoing issues including cumbersome workflows and difficult navigation. From private practices to multifacility health systems, leaders have come to recognize that monolithic, one-size-fits-all EHRs are not meeting the needs of their organizations.
Enhancing EHR flexibility will be a major theme in 2025. Having options when it comes to EHR configuration, customization and personalization enables organizations to address the hospital’s or practice’s needs while accommodating the preferences of individual users. Those able to achieve a balance between ease of use, efficiency and effectiveness will see the greatest return on investment from their EHRs.
Another trend we can anticipate for 2025 is adoption of the cloud. Organizations will migrate to public cloud platforms in greater numbers to facilitate real-time data sharing so providers can reference the most current information available and enable technologies like AI to perform to the fullest extent. The cloud will also help minimize the persistent problem of EHR downtime as many cloud platforms store their data in multiple data centers, helping to maintain ongoing data access.
Forging ahead
It’s hard to believe we are halfway through the current decade. From the COVID-19 pandemic to sweeping regulatory updates, changes across the industry have had widespread, lasting effects. Unexpected events may lie ahead, but one thing is for certain. Making incremental, sustainable changes that prioritize patient outcomes and enhance the provider experience will bring next-level healthcare within closer reach.
About the author: As president of Altera Digital Health, Marcus Perez currently oversees all facets of a global healthcare IT software company that provides solutions for hospitals and health systems, as well as large physician practices. Marcus leads Altera Digital Health with a vision to make digital healthcare better every day by focusing on the Harris Core Values, driving to build an enduring organization. Marcus is a 1989 graduate of West Point and a Veteran, having spent more than a decade in the military as a helicopter pilot and instructor. He is an avid basketball coach and holds a Master’s Degree in Education, along with an MBA.