What are the barriers restraining healthcare's digital transformation?

Budget constraints emerged as the top obstacle for health system executives.

A majority of health system executives perceive digital and artificial intelligence (AI) transformation as a high priority, although about 75% believe their investments are inadequate, according to McKinsey’s “Digital transformation: Health systems’ investment priorities” report.

“The absence of investment in a robust, modern data and analytics platform could delay value creation in areas that depend on these capabilities—such as efforts to close gaps in care, improve timely access for referrals, and optimise operating room throughput,” the report said.

Budget constraints were considered a significant barrier in executing digital transformation within the next two years, with more than half (51%) ranking it as a top obstacle.

“For example, a health system that is building a digital front door may lack the resources to simultaneously invest in the latest generative AI (gen AI) capabilities,” Jack Eastburn, a partner in McKinsey’s Southern California office and one of the report’s principal authors, said.

Another concern respondents pointed out was challenges with legacy systems due to a reliance on a smaller set of monolithic systems that may be difficult to untangle.

Meanwhile, other challenges highlighted include readiness to adopt and scale new technology (34%), data quality (33%), and tech talent and recruiting (30%).