The financial hit to healthcare has sparked a period of transition. Here's what experts think will happen next

The challenges facing the healthcare industry this year are massive. Hospitals are facing a daunting clinician shortage . They’re staring down another year of operating in the red , as labor costs – especially contract labor costs – eat into budgets. And new reimbursement contracts from government and private health insurers will require them to operate more leanly , while still making quality improvements.

So what big shifts are experts expecting in 2023? To find out, I spoke with several LinkedIn Top Voices to get their take on how the healthcare industry will confront the year’s most pressing issues.

Their responses point to an industry in transition – but also one where we’ll see more meaningful retention programs for nurses, more mental health support in the workplace, a primary care model that gets paid for the value it brings and a dawning recognition that technology won’t be able to replace the human element in healthcare.?

And tell me: With the annual J.P. Morgan Healthcare conference in full swing, the latest technologies impacting the industry will be front and center. What innovations do you think will change the healthcare industry in the year ahead? Share your thoughts in a post using #JPM2023 .

The nursing shortage will force hospitals to get serious about retention – not just recruitment

The nursing shortage isn’t getting better. As many as 100,000 nurses left the profession in 2021 – a historic number – and there’s been a marked decline in how satisfied nurses feel about their careers. The Bureau of Labor Statistics estimates that shortage exceeded 1 million nurses at the end of 2022.

Nurses are also showing that they’re willing to walk off the job for better pay and working conditions. Last year, for example, saw the largest-ever private nurses strike in Minnesota, where 15,000 nurses walked off the job. ?

That’s why Rebecca Love RN, MSN, FIEL , a nurse who serves as chief clinical officer at IntelyCare, a workforce management software company, believes that hospitals will redouble their efforts to retain the nurses they currently have.??

“I don’t think there will be a lot of brilliant new ideas thrown at recruitment,” she said, adding, “We’d be blind to talk about recruitment without retention tactics.”

Notably, she said that hospitals will need to find ways to engage nurses who only want to work part time, including targeted programs for new mothers and nurses nearing retirement age. Technology could also play a role in scaling the workforce through programs like virtual nursing and tele-triage.

Fundamentally, though, hospitals need to improve the factors that make life miserable for nurses: like poor staffing ratios, unsafe working conditions and a lack of decision-making power, Love said. “We don’t have a shortage of nurses,” she said. “We have a shortage of nurses who are willing to practice in healthcare the way it is today.”

?? See more of Rebecca Love's content on the nursing shortage .

Peer-to-peer support will become increasingly popular in workplace wellness programs

It’s arguably one of the more positive developments to have come out of the pandemic: people are talking more openly about their mental health at work, and employers have ushered in new benefits and wellness programs to meet the need.

But there’s a catch. Even when employees have access to mental health benefits, they can still struggle to find clinicians with availability or specific expertise. The challenge can even be harder for people of color looking for someone who can provide culturally-competent care.

“In an ideal world, there would be clinicians available to do individual or family or couples counseling – that is not the case,” said Melissa Doman, M.A. , an organizational psychologist and author. “The good thing is that there are many other stopgap solutions or bridge solutions that have flourished in recent years.”

One of the trends that she sees on the horizon is training more employees to have peer-to-peer mental health support conversations – including what she described as a “huge rise” in employee resource groups for mental health. Plus, at their core, those sorts of training help people develop emotional intelligence – a net benefit in any workplace.

Still, Doman pointed out that it’s important for employers to recognize these stopgap measures for what they are, and not try to gloss over the fact that employees may be struggling. “A trend that I hope will fizzle out are the programs that are unintentionally branded as toxic positivity,” she said.

?? See more of Melissa Doman's content on mental health at work

The primary care evolution will become more concrete

The signals started to be visible last year: First, Amazon announced a deal to acquire One Medical . Then CVS said it too wanted to get into the primary care business. Soon, health insurers were driving bidding wars for primary care practices.

But the splashy headlines weren’t the most significant indicator of a shift in primary care. Instead, it came out of Washington. Over the summer, the Department of Health and Human Services announced that it was putting together an “action plan” that will address some of the biggest pain points in the profession: lack of funding, a shrinking workforce and clinician burnout.

That’s the kind of policy framework that Kameron Matthews, MD, JD, FAAFP , the chief health officer at CityBlock Health, expects will usher in a substantial shift for primary care, such as payment models that, like payment models that reward doctors for keeping people healthy, instead of how much they can bill for services.

New doctors at the start of their careers don’t want to “repeat the trauma of residency,” she said. Instead, they want to work somewhere that allows them to spend time doing things that may not be billable but can make a real difference to someone’s health? – such as counseling them on nutrition. That’s the kind of care that CityBlock provides, and it’s been a key selling point for recruiting doctors.

“They’re going to continue to vote with their feet and go with models like ours or direct primary care,” Matthews said. “It’s systems like that that will really start to be recognized as top employers.”

As for the competition from Amazon and others? They won’t replace the relationships she has with her patients, she said.

?? See more of Kameron Matthews's content on primary care

Digital health companies will adapt to value-based care

The funding landscape has been tough for tech startups, but there’s still plenty of money flowing into digital health . Although deal volume last year looked more muted compared to red-hot 2021, it was still tracking closer to 2020 – the previous high for deal activity.

Of course, the healthcare sector isn’t immune to macroeconomic trends, said Gurdane Singh Bhutani , co-founder and managing partner at venture capital firm MBX Capital. Multiples have come down. There are several hundred pharma and biotech companies trading at negative valuations , below cash. And he expects more layoffs and startups going out of business.

Still, amid the past decade’s ebullience, some narrowing of the field is likely inevitable. “Frankly, there are probably too many healthcare companies created over the last few years that are doing things that are not fundamentally changing the healthcare system,” Bhutani said.?

Instead, like Matthews, he too expects a shift to value-based care – or reimbursing doctors and hospitals based on outcomes – which should benefit companies that help them adapt to the new environment. Other areas that should get interest are startups that help hospitals cut administrative costs or improve scheduling so they can reduce their dependence on contract labor, as well as those that can help manage an increased volume of patients, while still providing higher-quality care.

What’s less important? Brand-driven companies trying to become household names. “What we’re learning is that patients don’t have a high degree of trust in healthcare companies,” Bhutani said. “The trust is between the patient and the provider.”

?? See more of Gurdane Singh Bhutani's content on digital health

Elder care will call for a human touch

Nursing homes and long-term care facilities were particularly hard hit during the pandemic – accounting for a large number of COVID-19 deaths and forcing residents to endure isolation from their families.

Many nursing homes in the U.S. and Canada didn’t have any pandemic plans in place prior to 2020, said Dr. Rose Joudi , a Calgary, Alberta-based aging, ethnic diversity and senior living consultant, and were already behind other healthcare sectors in adopting technologies like electronic health records and clinical monitoring tools.??

There’s now a push to play catch-up – without necessarily the funding to do so.

One of the most pressing challenges in the space also remains staffing ; the U.S. Bureau of Labor Statistics reports that the sector lost more than 14% of its workforce since February 2020, in a profession already known for high turnover and that has struggled with recruitment.

Technology could fill some of the gap, but what older adults care most about are tools that can help them improve their quality of life and independence, Joudi said.?

In her work as a resident experience advisor for a nursing home, she recalled meeting a 90-year-old woman who called technology “all window dressing.”?

“‘What I care about is the emotional connection,’” Joudi recalled the resident saying.

Joudi added: “A human hug or touch, you can’t put a price on that.”

?? See more of Rose Joudi's content on healthy aging

How we compile the article

This article features experts from LinkedIn's Top Voices program covering the healthcare industry. Top Voices is an invitation-only program featuring a global group of experts on LinkedIn covering a range of topics across the professional world, helping members uncover valuable knowledge relevant to them. You can learn more here and check out other Top Voices articles in the U.S. here .

Who is eligible to be a Top Voice

LinkedIn members who meet high trust standards, are consistently active on the platform and share valuable expertise are eligible to be a Top Voice , with the exception of LinkedIn and Microsoft employees, members who have violated LinkedIn’s User Agreement — including our Professional Community Policies — or individuals currently running in a political election for an executive, legislative or judicial position.

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