CIOs Must Act “More Like CFOs” as Hospitals Lose Money: Kyndryl Exec

In 2025, health systems’ chief information officers are going to play a more prominent role in their financial strategy, according to Trent Sanders, vice president of U.S. healthcare and life sciences at Kyndryl—the world’s largest IT infrastructure provider.

“CIOs are going to start acting more like CFOs in efforts to help drive a system of sustainability,” Sanders told Newsweek earlier this month at the global health tech conference HIMSS.

Many hospitals still have not returned to their pre-COVID financial performance, leading executive teams to double down on saving and spending strategies. Kaufman Hall’s National Hospital Flash Report found that 37 percent of American hospitals were still losing money in 2024.

In a February blog post analyzing the report, Kenneth Kaufman—managing director and founder of Kaufman Hall—noted that poor performing hospitals tend to focus management efforts on their largest clinical and nursing areas, which are easiest to benchmark.

But other departments at these hospitals tend to perform poorly, which drags down financial results for the entire organization, Kaufman said.

Technological innovations like artificial intelligence have the potential to improve performance in some of these non-clinical departments, according to Sanders. IT, revenue cycle and supply chain combined can consume up to 35 percent of a health system’s total operating budget. These areas, while costly, are also prime targets for automation.

However, few health system executives see the value of generative AI in non-clinical departments, according to a recent survey conducted by Accenture.

The firm asked 300 CEOs, CFOs, COOs, chief information officers, chief technology officers and chief strategy officers from U.S.-based provider organizations with at least $1 billion in revenue about their generative AI strategies—and just 3 percent of executives pointed to call centers and customer service as key areas for transformation. Yet, other sectors have prioritized these departments, and Accenture estimates that generative AI could increase call centers’ capacity by up to 30 percent.

If CIOs work with CFOs and department heads to identify cost pressures, they can better target tech interventions to maximize savings. But to do so, CIOs will have to take on a more collaborative role, Sanders added.

“We’ve got to use the office [of the CIO] to really extend out to the business and say, ‘What are we doing to help fuel growth in revenue cycle, or to leverage the technology capabilities that generative AI can bring to supply chain management?'” he said.

“That, to me, is sort of a mindset shift that says it’s not just about the bright, shiny object technologies as a CIO,” he continued. “How are you using them to help your organization really drive sustainability?”

CIOs can also play a role in communicating the value and maturity of emerging technology to their organizations, Sanders said.

“There [are] a lot of proof of concepts that say, ‘Hey, we just need to try this out. We want to check out a tool,'” he said. “But really, how do we want to leverage that, and what’s the real benefit?”

“That’s where we need to be focusing on now,” Sanders continued, “and you’ve got a great opportunity to actually start making meaningful change.”

Trent Sanders will be speaking on Newsweek’s upcoming virtual panel for health care leaders, “Is Your Hospital Cyber-Safe?” Register for free to hear more from him live on April 10 at 2 p.m. ET.