Healthcare executives are dedicating budget to predictive analytics, and are forecasting significant cost savings in return, according to new research from the Illinois-based Society of Actuaries.
The survey, which included respondents from 218 health plan and provider executives, conducted earlier this year, revealed that more than half of healthcare executives (58 percent) anticipate dedicating 15 percent or more of their budget to predictive analytics in 2018, a five-point increase from 2017. The year-over-year increase spans both payer and provider organizations.
Further, 60 percent of healthcare executives forecasted that predictive analytics will save their organization 15 percent or more over the next five years. Significantly more provider executives (75 percent) said they are more likely than payers (44 percent) to foresee this return on investment from predictive analytics.
Researchers found that projected predictive analytics has remained steady since 2017, with 85 percent of executives indicating they either currently use predictive analytics or plan to in the next five years. A majority (87 percent) of healthcare executives also indicated that predictive analytics is important to the future of their business.
While current analytics use is indeed high, there was a seven-point year-over-year decline in the overall number of executives currently using predictive analytics, driven primarily by payers. However, it’s important to point out that 26 percent of payers anticipate using predictive analytics in the next year, a 10-point increase from last year, which indicates the potential for future growth, researchers noted.
Survey results also suggested that challenges to implementing predictive analytics processes may be
affecting current use. For example, in 2017, “lack of budget” (16 percent) was the biggest challenge for both payers and providers. But, in 2018, healthcare executives cited two additional issues with implementing predictive analytics processes, with lack of budget (14 percent), regulatory issues (14 percent) and incomplete data (14 percent) all seen as equal challenges.
As far as motivating drivers, a majority (52 percent) of healthcare executives cited the ability to reduce costs as the most important outcome to achieve with predictive analytics, while beyond cost, healthcare executives see patient satisfaction (43 percent) and staffing/workforce needs (39 percent) as valuable outcomes to foresee using predictive analytics.