Trends in Healthcare & Governance

HTNYS’ monthly Trends updates provide trustees with information about emerging developments in governance and healthcare. Published by HTNYS on the second Wednesday of each month, Trends’ timely statistics and insights help trustees fulfill their roles and responsibilities while adapting to the changing environment.

Physician well-being as a board priority
April 2025

Physicians play a critical role in maintaining a successful hospital and health system. Since the governing board is ultimately responsible for an organization’s quality of care, it has an important role to play to enhance and nurture a partnership with medical staff as they work together to advance their organization’s mission.

Compassion fatigue and burnout

Recently we’ve heard from member leaders that their physicians and other care providers are experiencing “compassion fatigue.” Compassion fatigue is a form of burnout from sustained employment-related stress that compromises an individual’s desire to work. Secondary trauma can also result from the protracted exposure to the suffering of others.

Three components of burnout

  • Emotional exhaustion: The experience of feeling overwhelmed, depleted and drained of emotional and physical energy.
  • Depersonalization: A sense of disconnection from one’s work, often manifesting as cynicism and a loss of empathy.
  • Reduced personal accomplishment: Characterized by feelings of inefficacy, diminished competence and a perception of inadequate achievement.

Causes

Burnout tends to emerge from a range of industry-wide challenges, including:

  • excessive workload;
  • time pressure;
  • administrative burdens;
  • technology challenges;
  • insufficient advanced practice providers;
  • inadequate support staffing;
  • workflow inefficiencies;
  • organizational culture; and
  • lack of control.

Prevalence

According to the American Medical Association:

  • burnout was highest after the pandemic in 2021 at 56%, then continuing on a positive, downward trend;
  • in 2023, 48.2% of physicians identified as having burnout;
  • the first two quarters of 2024 were even lower at 45%.

Organizational impact

Physician well-being is critical to the strength and sustainability of a healthcare organization. Burnout poses significant risks, including:

  • putting quality and patient safety at risk (increased medical errors, increased adverse outcomes, two times the risk of patient safety incidents, three times decrease in patient satisfaction);
  • draining critical talent;
  • creating a financial burden; and
  • diminishing continuity of care.

These are all issues that fall within a board’s responsibility. As stewards of the hospital’s most vital assets, trustees hold a fiduciary responsibility to protect physicians and prioritize high standards of care.

Solutions

Healthcare boards and executive leaders must invest in practical, sustainable solutions that relieve the burden on physicians and promote systemic change. They must:

  • tackle the root causes of burnout;
  • plan in partnership with physicians;
  • fix dysfunctional work environments;
  • create a culture that embraces values and virtues like purpose, connectedness and gratitude;
  • allow physicians to have greater control over their schedules; and
  • expand team-based care by integrating more mid-level providers, hiring more administrative and support staff, protecting time off and streamlining documentation and administrative processes.

Addressing physician burnout must be a key board priority. By supporting physician well-being, the board is investing in the organization’s most essential talent and in ensuring quality, safety, financial health and an exceptional patient experience.

Information for this article was obtained from:

Leveraging AI in the boardroom while balancing innovation, efficiency and compliance
March 2025

Artificial intelligence can improve the effectiveness and efficiency of healthcare board activities. However, given the healthcare industry’s uniqueness and complex regulatory landscape, there are also inherent risks. Healthcare boards must strike a balance between embracing innovation and ensuring safety and security.

The use of AI is rapidly growing in all industries. Nearly one-third (30%) of board directors believe AI will be one of the most significant trends impacting their organizations this year, according to a recent National Association of Corporate Directors survey.

The advantages of AI

Healthcare boards use AI for a variety of purposes including onboarding trustees, preparing for meetings, drafting meeting minutes and ensuring regulatory compliance. Advantages can include:

  • Enhanced efficiency and productivity: AI tools can handle routine tasks, analyze data and summarize lengthy information.
    • Summaries of detailed reports allow trustees to spend less time preparing for board meetings and more time engaging in productive discussions and making decisions.
  • Data-driven insights: AI tools can identify current and anticipate future trends to help trustees make informed decisions.
    • AI can reveal trends of certain populations using specific services, which trustees can use to make strategic decisions.
  • Increased consistency, accuracy and compliance: AI tools can review written reports and data, minimizing human error.
  • Quick access to critical information: Secure AI tools can retrieve relevant documents and data points, making information more accessible.
    • This feature can be helpful to healthcare trustees who often receive a significant amount of information, making it easier to find what they’re looking for.

Consider the risks

Despite these advantages, trustees need to choose their AI tools wisely.

  • Hospitals and health systems must ensure their AI tools comply with HIPAA regulations and other regulatory compliance or face steep penalties and long-term reputational damage.
  • Hospitals and health systems handle sensitive patient information, so they must safeguard it by prioritizing security and compliance.
    • Publicly accessible tools like ChatGPT and Google Gemini are powered by large language models that ingest all user inputs, including data and content, for future training and outputs. This means that confidential data or sensitive content may later become available to others, so these tools shouldn’t be used to support healthcare board governance activities.
  • Healthcare boards must seek AI tools within secure and private solutions.
    • Boards that use a board portal should ensure the provider has accreditations or certified compliance with widely accepted data and privacy standards and those unique to the healthcare industry.

Not only do healthcare trustees need to evaluate AI for their board’s use, but they also must oversee their organization’s use of AI. To provide proper oversight and make strategic decisions, healthcare trustees should be educated and understand the implications of AI for their organization. Yet, AI’s rapid growth makes it challenging to stay updated. HTNYS can help!

  • We are developing a healthcare IT series of videos as part of HTNYS Boardroom Essentials that will include a video on what trustees need to know about AI.
  • Plus, we’re excited to have Steve Berkowitz, MD, returning to this year’s Trustee Conference to discuss the latest on AI for healthcare trustees. Save the date for Sept. 11 – 13 at The Saratoga Hilton.

Information for this article was obtained from:
How to Leverage AI in the Health Care Boardroom: Embracing innovation while maintaining security and compliance, Beckers Health IT

In an era of noise, go back to governance basics
February 2025

Hospitals, health systems and their boards are operating in an era of constant noise. Amid healthcare’s rapid changes and increasing complexity, boards’ oversight responsibilities have been expanding. Newer areas of oversight include climate change, cybersecurity and artificial intelligence, with more to come.

Nasdaq’s 2023 Global Governance Pulse survey found that 84% of surveyed board members, executives and governance professionals across many industries expect increased or sustained scrutiny and time requirements for board service in the coming months.

Back to the basics

Trustees may wonder how to add tangible, unique value in this rapidly evolving environment. At a time like this, it is helpful to reflect on the key role of the board, which is board service. This may sound simplistic, but excellent board service requires that the board be committed to excellence in all facets of governance. A board that excels with board structure, diversity, selection, orientation, education, self-evaluation and culture elevates the hospital’s performance.

Tools to reflect on board culture, composition and succession planning

Only 7% of responses to the Nasdaq Governance Pulse survey indicated that their board evaluation process results in specific action plans to address opportunities, risks and weaknesses. A commitment to continuous improvement is key to a dynamic and responsive board. Board evaluations provide insights into the board’s strengths and opportunities for improvement regarding board composition, oversight, engagement, culture and governance processes.

A board demographic/skills gap analysis ensures that board succession planning is strategically aligned with the organization’s future needs. Additional options to fill knowledge gaps include investing in trustee education and creating advisory seats for subject matter experts to facilitate the board’s understanding of specific topics.

High performance governance practices

An AHA article suggests that there are four practices that hospital and health system boards must engage in today to be successful in the future:

  1. Define a clear mission and vision for a transformed enterprise.
  2. Create an environment of trust.
  3. Establish a foundation of effective communication.
  4. Build a board-CEO co-leadership partnership.

Boards must be currently performing at an extremely high level to be successful in the future. With the number of demands facing boards, it’s easy to put the basics on the back burner. Keeping the essential elements of effective board governance a priority will put boards in a better position to navigate the noise that challenges healthcare today.

Information for this article was obtained from:

Major headwinds predicted for 2025
January 2025

As we enter the new year, hospital and health system leaders are considering challenges and opportunities that may arise in 2025. Becker’s Hospital Review recently shared what is on the minds of 74 health system executives. The following are the major headwinds they predict.

1. Continued staff shortages: In 2025, expect a national shortage of:

Mercer predicts a shortage of about 100,000 critical healthcare workers by 2028. This means the potential for less access to care, slower patient throughput and the need to pay higher wages to stay competitive.

HANYS’ November 2024 Hospitals Fiscal Survey Report highlights the issue in New York, where 97% of hospitals reported a shortage of nurses and 88% reported shortages of non-nursing personnel.

Hospitals and health systems continue to mitigate these shortages by creating pipeline programs, strengthening the workforce, automating administrative tasks where possible, developing hospital-at-home programs and forging partnerships to provide in-person and virtual coverage for patients.

2. Financial pressures: Slow margin growth is expected nationally along with rapidly rising costs, inflation and an increase in payer claims denials. All will contribute to providers’ financial challenges.

In New York, three out of four hospitals reported that they do not have the operating margins needed to maintain and improve access to patient care, attract and retain a skilled workforce, invest in technology and research, secure capital funding and modernize their facilities. On average, New York’s hospitals projected a median 0.0% operating margin for the year — a slight improvement over recent years — but indicative of our healthcare system’s fragility (HANYS’ Hospitals Fiscal Survey Report).

Hospitals and health systems may have to strengthen their expense management and revenue capabilities. To make a difference this year, executives are adding revenue streams, diving deeper into value-based care and entering into new partnerships to implement technology.

3. Trump administration: A new administration brings uncertainty about healthcare policy. Healthcare leaders must plan for various scenarios.

4. Technology integration: Technology is no longer a “nice to have” — it’s a “must have.” Hospitals with the resources to implement new technology and data analytics will fare better than smaller systems and independent hospitals already struggling financially. Providers may need to divert funds from other essential areas and/or rely on partners and donors to achieve technology goals.

5. Medicare Advantage: In 2024, health systems experienced heightened claims denials and low reimbursement rate increases under Medicare Advantage. This will remain a significant challenge this year as the health plans continue to grow. Healthcare provider executives will have to continue to work with their payer partners to ensure their agreements properly consider future inflation and performance targets.

6. 340B Program: Pharmaceutical companies are pushing for changes to the 340B Program, so be prepared. Healthcare leaders must prepare for the impact of the Inflation Reduction Act of 2022 on the 340B Program.

7. Supply chain: The cost of drugs and medical supplies will remain high, with several supplies remaining on the shortage list. Continue to increase coordination and prepare for shortages.

8. Cyber threats: Both the frequency and sophistication of cyberattacks against hospitals and healthcare providers will continue to rise, making it imperative to invest in keeping your organization safe.

9. Access to care: Patient demand will continue to grow. Improving and increasing access to care will be one of the top priorities, so hospitals may have to improve existing care models or consider developing alternative ones.

10. Private equity: Private equity companies continue to make investments in hospitals, physician groups and other healthcare-related businesses — a concern for some in the nonprofit sector.

To learn more about these headwinds and what health system executives are doing about it, read “10 Headwinds for health systems in 2025” by Becker’s Hospital Review.

Information for this article was obtained from: “10 Headwinds for health systems in 2025,” Becker’s Hospital Review and HANYS Hospitals Fiscal Survey Report.

2024 Trends

2023 Trends

2022 Trends

2021 Trends