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From Risks to Resilience: Technology transformation in healthcare

Why healthcare organizations must proactively embrace and effectively manage technology transformation.
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Promise and perils: Technology transformation for healthcare

Healthcare systems are under enormous and increasing strain. Demand will grow as populations get older and sicker, and as medical advances broaden the scope and societal expectations for what can be treated and cured. At the same time, shrinking labor pools will both limit capacity to provide care and raise the cost of delivery.

Under-resourced systems expose themselves to challenges such as declining care quality, escalating liability risks, worsening employee morale, and deteriorating institutional reputations. Systems under chronic stress are more vulnerable to potential future crises driven by contingencies such as pandemics or extreme weather.

Technology advances have a major role in boosting financial, operational, and strategic resilience.

  • In the near-term, rapidly evolving technologies such as generative AI can augment humans to improve productivity as well as automate tasks to cut costs. Such efficiencies can ease financial strain, build buffers for future crises, and fund resilience investments at healthcare institutions.
  • Digital solutions such as tele-health and automated decision support tools can also deliver operational efficiencies, expand capacity flexibly to meet spikes and swells in demand, improve capacity utilization and care quality, and mitigate disruption risk during crises.
  • In the longer run, technologies can help put healthcare demand and costs on a sustainable trajectory by facilitating proactive and personalised care for more effective disease prevention and management, and by improving connectivity and coordination across institutions.

However, technology may augment risks for healthcare systems by amplifying current risk drivers, extending risk interactions, triggering risk cascades, and creating new risks.

  • AI and other technologies can worsen existing risk exposures for health institutions, including professional and institutional liability risks related to batch events in which more than one patient is affected by the same cause.
  • Technology risks can arise from leaders, managers, and clinicians failing to appreciate the limitations of machines; assigning responsibilities beyond the capabilities of machines; relying on machine outputs uncritically; and failing to anticipate potential failures, their differential impacts, and spillover effects.

Healthcare systems and institutions need to mitigate and manage these and other risks. They need to understand the limitations of technologies; anticipate how, where, and when risks could crystallize; be alert to possible knock-on impacts; and adjust risk transfer and response playbooks. Effective human oversight, accountable governance structures, and other processes can help reduce risk exposures and vulnerabilities.

Even the best new technologies face roadblocks to deployment. To realize their full potential, institutions need to analyze and work to overcome the barriers, which include:

  • User hesitancy or resistance, knowledge and skill gaps, and fear of disruption or role changes.
  • Old and fragmented technological infrastructure that can delay implementation and limit data sharing, process standardization, and care coordination.
  • Technologies that fail to deliver the expected benefits, for example, if institutions deploy unsuitable tools or retain existing process inefficiencies.
  • Poor functionality and cumbersome experience due to not involving intended users during design, development, testing, and monitoring phases.
  • Sub-optimal deployment due to a failure to invest in continuous learning and upskilling of clinical and non-clinical staff as technology capabilities evolve.

Healthcare systems cannot afford to miss out on the technological opportunities that are becoming available, which will augment healthcare staff, expand healthcare provision, improve patient experience and outcomes, and ensure financial viability. By weighing the risks associated with and without deployment of these technologies, healthcare organizations can optimize their use in cutting costs, improving crisis preparedness and response, and reducing the health vulnerabilities in their communities.

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Marsh McLennan, with the combined capabilities of Marsh, Mercer, Guy Carpenter, and Oliver Wyman provides key insights into the rapidly evolving technologies in healthcare today.

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