Healthcare Leaders Anticipate Minimal Financial Gains in 2025, Prioritizing Performance Improvement and Growth Initiatives, According to Strata Report
Margin Management and Controlling Costs Cited as Top Concerns for the Year Ahead
CHICAGO – February 20, 2025 — After years of volatility, healthcare leaders across the nation’s hospitals, health systems, and other healthcare organizations view 2025 with cautious optimism. Many healthcare leaders anticipate their organizations will see few financial gains throughout the year, despite finances largely stabilizing in 2024. To gain momentum, organizations are prioritizing data-driven performance improvement and growth initiatives, according to a new report from Strata Decision Technology.
Featuring survey results from more than 100 U.S. healthcare finance professionals, the 2025 CFO Outlook for Healthcare report found that 44% expect their organizations’ operating margins to remain approximately the same in 2025 compared to last year, while just over a third (36%) anticipate operating margins to increase and 14% expect them to decrease. At the same time, 96% of respondents said they are confident in their team’s ability to remain agile and adjust strategies to adapt to ever-changing market and business circumstances. This highlights an increased resiliency among healthcare providers, as they harness the lessons their teams have learned from the recent years of turbulence.
“The relative financial stability hospitals and health systems achieved in 2024 is a welcome success after navigating years of financial uncertainties,” said Alina Henderson, Vice President of Healthcare Solutions at Strata Decision Technology. “Looking to the year ahead, healthcare leaders have confidence in their teams’ resiliency and focus as they continue to strengthen their organizations through targeted capital investments and strategic initiatives.”
Healthcare leaders identified managing strategic and performance improvement initiatives as the No. 1 priority for 2025, according to 56% of survey respondents. Other top priorities include measuring and managing productivity, managing service line financial performance, and reducing costs.
The biggest concerns for healthcare leaders in 2025 focus on the challenges of maintaining financial stability. Margin management was cited as the top concern by 55% of respondents, followed by labor expense (52%), payor rates and negotiations (42%), and labor recruitment and retention (30%). It should be noted that ongoing labor issues in healthcare continue to be a common theme among healthcare leaders — as evidenced by productivity management being the second highest priority for 2025, and two of the top four concerns being centered on labor issues.
Most organizations use data from a variety of sources to support operational and financial analysis, yet a vast majority of healthcare leaders believe their organizations have significant room for improvement in how they use data. More than nine in 10 respondents (91%) said their organizations should do more to leverage financial and operational data to inform strategic decisions. The most common types of external data used by organizations that participated in the survey are regional demographic data (79%), procedure volumes (72%), labor benchmarks (67%), and clinical benchmarks (65%).
While they have a substantial amount of data, many healthcare leaders feel they lack actionable insights. Nearly three-quarters of survey respondents cited building better analytics and insights as their top area of investment in 2025, followed by growing comparative analytics and service line prediction capabilities.
About Strata Decision Technology
Strata Decision Technology, LLC provides a cloud-based, enterprise performance platform for software, and data and service solutions to help organizations better analyze, plan, and perform in support of their missions. More than 2,300 organizations rely on Strata’s StrataJazz and Axiom solutions for financial analytics, planning, and performance management. Named the market leader for Business Decision Support for more than 15 consecutive years, Strata delivers first-class solutions and service, with an intense focus on accelerating innovation. For more information, please go to www.stratadecision.com.
Media contact:
Sally Brown, Inkhouse
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