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Healthcare executives forecast big growth in 2019 and not just from M&A

Growing other lines of business will also fuel growth for healthcare organizations but execs fear new reimbursement rules and regs.

Beth Jones Sanborn, Managing Editor

A new poll of nearly 300 senior healthcare executives by Capital One is forecasting big growth in 2019, with results showing 97 percent of respondents expecting to at least match 2018's performance this year and 73 percent saying they expect better performance.

The survey was conducted between November 15 and December 3, 2018 and asked professionals to provide their industry and company outlook. Respondents included 291 senior executives from healthcare companies, including pharmaceutical, healthcare IT and medical technology companies, hospitals, healthcare service providers and health systems, as well as other industry players.

THE IMPACT

The results indicate that merger and acquisition activity will continue to be a driving force in the industry, but there will an increased focus on growing other business lines as well. Capital One also forecasts a high demand for capital to accommodate the growth, with 96 percent of respondents citing an increased or consistent need for capital in 2019, compared to last year. 

THE TREND

M&A is also too of mind when it comes to growth strategies, having been cited as the primary growth strategy for many of the respondents. However there was a slight dip in the number of execs who put M&A at the top of the strategy list: 44 percent of executives cited it for in 2019, down from 50 percent last year.

Meanwhile a quarter pointed to "organic methods," specifically revamping and updating existing offerings and another 21 percent said new segments or lines of business were their top strategies for 2019.

Meanwhile, execs said regulation and reimbursement concerns would be their top challenge in 2019, followed by recruiting and retaining employees. Some specific recruitment and retention hurdles execs said they face are a lack of skilled applicants, competition from larger companies, applicants coming in outside of desired pay ranges and competition from startups.

ON THE RECORD

"Growth opportunities have been in no short supply for healthcare organizations over the past several years, and investment in talent is one such area where many leaders will be focused on as competition for skilled talent continues to increase," said Al Aria, senior managing director of Capital One Healthcare. "Whether it's a major acquisition or a focus on further establishing existing product or service lines, we look forward to providing our customers with the advice and capital they need to realize their goals."

Twitter: @BethJSanborn
Email the writer: beth.sanborn@himssmedia.com

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