Concerns around how to protect data are a massive barrier to adopting digital strategies among provider and payer executives, a new report found.
The report, released Wednesday from PwC on 2020 trends in the healthcare industry, found cost and lack of talent were major problems as well. The report also identified the direction that mergers and acquisitions could take next year.
A survey accompanying the report found that 94% of payer executives and 85% of provider leaders listed ensuring cybersecurity and privacy as major barriers to digital strategies. The survey conducted earlier this year by PwC contains interviews with 300 provider executives, 100 payer executives and 100 life science leaders.
“When it comes to making use of their data, few companies are able to go it alone,” the report said.
Companies rely on third-party vendors to store or send data that are used to conduct research or improve processes.
“These relationships help drive efficiencies but they also leave data open to breaches,” PwC said.
But concerns about security and privacy are the tip of the iceberg. Another issue that is going to become a major concern is talent.
Nearly half of payers (45%) and providers (49%) listed getting the right talent as a major barrier to implementing digital strategies.
Across all the industries surveyed, 30% listed a lack of analytical talent as an obstacle to monetizing data. Other obstacles were poor data reliability (34%), data protection and privacy regulations (33%) and an inability to secure data (32%).
The healthcare industry will have to work on “retraining and educating their own workforces,” said Ben Isgur, leader of PwC’s Health Research Institute.
Searching for an identity in 2020
The PwC report predicts mergers and acquisitions will continue at a brisk pace next year, with healthcare companies looking primarily to expand into new areas.
“We surveyed healthcare executives, and about 40% of them said their companies are somewhat or very likely to acquire across the healthcare sector,” Isgur said.
But the types of deals in 2020 will be different. About five years ago, there were more horizontal deals where healthcare systems and payers got bigger. Over the past couple of years, there have been more vertical deals, in which healthcare companies look to expand into new sectors, Isgur added.
Now, in 2020, deals will focus more on identity.
“We will see more health systems and health organizations pick identities and move towards them,” he said.
For example, a healthcare system can narrow its focus on providing the best patient experience.
“Maybe my next deal isn’t with a hospital system but with a technology company,” Isgur said. “Or maybe it is the right physician practices and round out and create a better user experience.”
The top priority for a deal for a provider was access to new technology, with 24%. For payers, the ability to remain competitive in a market was the top priority with 26%.