Healthcare Trends

A dynamic mix of risk and reward ushered in the year, according to Healthcare Finance Trends for 2026 (hereafter called Trends Report). This annual CommerceHealthcare^® assessment of key issues and challenges confronting healthcare leaders identified several themes across four overarching categories:

• Financial & Reimbursement
• Patient Financial Experience
• Technology and Automation
• Leadership Directions

This report tracks the status of the themes at mid-year to help leaders evaluate current directions.

Highlights.

• Insurance and reimbursement concerns are unsettled in the short term and uncertain in the longer term. This year has witnessed declining enrollment and higher premiums in the Affordable Care Act marketplaces, fewer projected enrollees in Medicaid expansion states for 2028, and significant provider-payer tensions over Medicare Advantage.
• Affordability challenges are causing care deferral for many and keeping demand for patient financing at elevated levels.
• Finance and revenue cycle management remain a focus of artificial intelligence investment in 2026, which is augmenting funding for a variety of technology-enabled solutions such as remittance management systems and robotic processing automation.
• From virtual credit cards to digital wallets to near-real-time payment networks, digital payments are seeing accelerating growth and making promising inroads in healthcare.

Finance and reimbursement updates.

Finance.

Trends Report’s first theme was Financial Uncertainty and Risks Constrain Planning. At mid-year, financial pressures remain a dominant factor. Healthcare organizations are balancing substantial investment in transformative technology with a strict focus on cost control and margin improvement. A brief scan of leading metrics reveals both the progress and the prevailing challenges.

Profitability showing strain.

Operating margins have been improving, but still lag behind 2025. Through April, hospital year-to-date (YTD) operating margins were 2.5% with corporate and other allocations and 8.3% without them.^{[1] footnote} Health system median margins have been negative to just above breakeven through April, a notable deterioration from 2025’s slender results.^{[2] footnote}

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Recently, 72% of CFOs reported that their organizations are experiencing margins of 2% or lower.^{[3] footnote} Many rural hospitals are on a financial precipice. Over 40% of them lose money from patient services.

Expenses, especially labor, continue to escalate.

Total hospital expenses increased 7.1% year-over-year (YOY) in the first quarter.^{[4] footnote} Labor cost is an ongoing challenge. Staffing shortages and elevated turnover levels have proven difficult to remedy. Overall hospital labor cost per calendar day increased another 4% YTD through April.^{[5] footnote} Turnover for 2025 was 18.5%.^{[6] footnote} Almost one-third of medical group practices are experiencing higher staff turnover this year versus 2025.^{[7] footnote} Chronic shortages of care staff in skilled nursing and other post-acute facilities are causing limitations on admissions, which can extend length of stay for hospitals.^{[8] footnote}

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Revenue and volume are encouraging.

Through April, hospital net operating revenue logged a 7% increase from the prior year, helped by growth in outpatient care.^{[9] footnote} Volume is also growing. YOY inpatient admissions have risen 4.8%, while outpatient visits gained 3%.^{[10] footnote} Both adjusted discharges per day and operating room minutes increased 2%.^{[11] footnote}

Bad debt and uncompensated care rising sharply; cash flow steady.

Relative to 2025, bad debt and charity care per calendar day were up a concerning 15% YTD through April.^{[12] footnote} Regarding cash balances, 30% of organizations expect them to improve in 2026, 30% forecast lower levels, and 40% remain unchanged.^{[13] footnote}

Outlook.

How are leaders viewing the financial landscape for the remainder of 2026 and beyond? Analysts generally anticipate low- or mid-single-digit topline growth accompanied by thin margins. A new forecast sees health plan medical costs leaping 8.5%–9% in 2026 and the same amount in 2027.^{[14] footnote} That portends greater pressure on providers from employers and payers to lower prices. Fifty-six percent of revenue cycle management (RCM) leaders now anticipate increased days in accounts receivable ranging from 1% to over 10%.^{[15] footnote}

The financial outlook has been described as “persistently challenging, and constantly shifting.”^{[16] footnote} Organizations are doing their best, but many face hurdles in driving needed change. A survey found 44% of respondents lack time and resources to concentrate on performance improvement.^{[17] footnote}

Reimbursement.

Another financial concern explored in Trends Report was encapsulated in the theme Medicaid and other Government Cuts Complicate Providers’ Financial Risk Calculus. Since the report’s publication, developments across the reimbursement spectrum have emerged.

Looming Medicaid cuts gaining clarity.

Providers continue to brace themselves for substantial cuts in Medicaid over the next several years. Various estimates of the impact of new work rules and other changes have been offered in recent months.

One analysis suggests new eligibility limits will prompt a reduction of 7.6 million Medicaid enrollees over the 2025–2034 period.^{[18] footnote} Another calculated the effect on the Medicaid expansion programs of recent years. Three iterations were made assuming differing strategies by states to mitigate the impact of the new requirements. All three resulted in reduced Medicaid expansion enrollment in 2028, projecting between 4.9 and 10.1 million fewer individuals.^{[19] footnote}

Hospitals serving lower-income areas may be at significant risk of closure or service reductions if other government payments insufficiently blunt the Medicaid impact. A study estimates 446 in heightened risk status.^{[20] footnote}

Also slated for restriction is the Medicaid Managed Care State Directed Payments Program, which federal officials believe has been a conduit for states to gain additional funding. Cuts could total $775 billion over 10 years.^{[21] footnote}

Affordable Care Act (ACA) enrollments down, premiums up.

Subsidies to help individuals obtain insurance through the ACA marketplaces have now expired. Federal data shows that 23.1 million people signed up during the 2026 open enrollment period, a drop of more than one million. Examination of sign-ups and premium payments in 2026 revealed several pressure points:^{[22] footnote}

• Average monthly paid enrollment could decline from 22.3 million people in 2025 to between 16.5 million and 17.5 million people in 2026.
• Premium payments rose an average of 58% from $113 to $178 per month.
• Average 2026 deductibles increased by 37% to a record high of $3,786.
• During the first quarter, 17% of surveyed enrollees lacked confidence in their ability to afford ACA premiums.

Providers wrestling with Medicare Advantage trends.

Medicare Advantage (MA) has become a contentious issue. Providers see prior authorization policies and payment disputes as adding to their cost and hindering access for patients. Several health systems have dropped plans with some insurers.

A different MA trend is expansion of Special Needs Plans (SNPs) that cover dual Medicaid-Medicare enrollees, chronic care and beneficiaries needing long-term care. In February, SNPs were up over 12% from the prior year, which itself experienced 10% growth.^{[23] footnote} These plans can be beneficial for providers, and they are being promoted by insurance companies since they carry higher margins than straight Medicare Advantage.

Patient financial experience updates.

Affordability.

Trends Report engaged a chronic theme in patient finance: Affordability a Headline Issue for 2026. The report cited an HFMA assertion that “the healthcare system is not making progress toward improving affordability” and could slip into “crisis mode.”^{[24] footnote}

The numbers portray a challenging picture.

Studies continue to define the extent and impact of healthcare’s struggles with patient affordability. A sample of recent data points reveals the following:

• A national poll saw 32% of respondents indicating they’re very worried about being able to afford healthcare, with another 34% somewhat worried.^[25]
• Concerns range across all types of healthcare costs.^[26]

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• A Federal Reserve study showed that 21% of adults reported at least one significant unexpected medical expense in the past year.^[27]
• Employer-sponsored health plans covered 61% of workers in 2025, dropping from 64% in 2020.^[28]

The care deferral syndrome.

Affordability challenges lead many to defer needed care or avoid it entirely. In early 2026, 26% of surveyed adults said they had postponed surgical or medical treatment sometime over the past four years due to cost.^{[29] footnote} Statistical analysis of a large data set showed that one-third of people with medical debt deferred care in the prior twelve months due to cost — more than six times the rate of those without medical debt.^{[30] footnote}

In addition to the health risks posed by these behaviors, deferral affects provider revenue. Also, 40% of employers are tackling affordability through direct price negotiations with providers and carriers.^{[31] footnote}

The patient financing imperative.

Demand for patient financial assistance from health systems, hospitals and practices is high. U.S. patient financing has been growing at a 4.1% compound annual rate for five years and stood at over $18 billion in 2025.^{[32] footnote}

Payment plans produce good outcomes when they are both expansive and flexible, to meet today’s widely varying patient needs. CommerceHealthcare^® experience has demonstrated that best practice involves no- or low-interest credit lines with longer durations and higher dollar caps. That minimizes administration and maximizes the ability to personalize assistance and structure comfortable repayment schedules. A growing option is extending financing, based on preservice estimates.

Patient financial experience improvement.

Well-delivered financial assistance is one cornerstone of positive patient financial experience. Trends Report explored pathways to better experiences through the theme: Emphasis on Communication, Transparency, Technology to Improve Patient Financial Experience.

Communication.

Successful organizations have used consistent, proactive communications to improve customer satisfaction and point-of-care collections. They discuss payment plans earlier in the patient journey, stress options and affordability concerns rather than just collection, and get help from outside financial institutions that are skilled at assuming and managing the patient responsibility process.^{[33] footnote}

Communication must also account for variations in patient economic status and propensity to pay. One financial engagement firm distinguishes between “high-capacity” and “at-risk” patients. The latter includes “individuals who are underinsured, uninsured, digitally disengaged, or facing large, complex bills.”^{[34] footnote} As the figure below displays, they tend to receive significantly less communication regarding payment reminders and outreach for help.

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Transparency.

Some expect “real-time price transparency” to emerge as a game-changer for the patient financial experience. Using AI and automated data integration, “real-time transparency tools enable health plans and providers to instantly exchange care plans, eligibility, and coverage information at the moments that matter most.”^{[35] footnote}

Technology.

Several recent analyses have focused on the promise of artificial intelligence (AI) and other technologies to personalize the financing process. A health system CFO observed that today’s payment prediction tools are strong, but they’re not “factoring in unique patient personas or circumstances. There’s definitely an opportunity to go deeper.”^{[36] footnote}

Financial institutions are seeking to harness AI for individually tailored solutions. They will need to build trust in these tools, given that 44% of older adults distrust AI-powered financial information.^{[37] footnote}

Technology and automation updates.

As Trends Report delineated, technology is the wellspring of advancements in financial automation, digital payments and cybersecurity. Valuable data and insights have been offered in each area since the report’s publication.

Automation.

The first trend asserted that Accelerating Automation in Finance is Gaining Fresh Impetus from AI. Several current insights merit attention.

AI expanding fast in healthcare finance.

Investment in AI in finance and RCM is on a clear upward trajectory. Overall, health systems report a 67% increase in adoption of AI for three or more applications in 2026 relative to 2025.^{[38] footnote}

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As of late 2025, 38% of organizations were using generative AI to achieve administrative efficiency in RCM, finance, claims and related departments.^{[39] footnote} The AI expansion comes on top of investments in a variety of technology-enabled solutions, from remittance management systems to robotic processing automation. For example, the latter is projected to grow in healthcare at almost 15% yearly to become a $4.5 billion market by 2030.^{[40] footnote}

Powerful automation drivers.

Healthcare administrative processes still involve many manual and complex workflows. Automation offers meaningful cost savings and productivity gains. Recent studies map the scale of the opportunity:

• $19 billion projected savings from full automation of several high-volume transactions, including ones that are payment related.^[41]
• $43 billion is the staggering sum hospitals spent in 2025 trying to collect payments due from insurers.^[42]
• 45% increase in cost to collect over the past two years.^[43]
• 40% of outpatient group practices employ three or more full-time staff per physician to assist with administrative and regulatory-related tasks.^[44]

Taking a broad view of return on automation.

The returns from AI and automation are being realized in tangible cost reduction and productivity. Leaders are realizing that, beyond the numbers, efficiency is becoming “a long-term strategic advantage rather than a temporary cost-cutting exercise.”^{[45] footnote}

It also addresses affordability. Reducing administrative complexity ranked second in a recent survey that saw 23% of respondents cite it as the priority change needed to promote affordability.^{[46] footnote}

Healthcare executives are optimistic about long-term automation returns. Half of them see high or very high ROI from RCM technology over the next five years.^{[47] footnote}

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Overcoming barriers to AI-driven automation success.

Just over half of leaders describe their current workforce as having the requisite skills to adopt and scale emerging RCM automation innovations.^{[48] footnote} The rapid increase in AI agents adds complexity. Organizations are quickly realizing that agentic success “involves rearchitecting the entire task flow from the ground up.”^{[49] footnote}

Digital payments.

Another prominent technology theme in the Trends Report covered the Emergence of Real-Time Payments Transactions. Digital payments encompass an array of options that open new levels of speed, convenience, cost savings and security. Digital rails are expanding across industries to convert the nearly one-third of business-to-business (B2B) transaction volume processed by cash or check.^{[50] footnote} The U.S. healthcare digital payments market is expected to be $26.8 billion by 2034, powered by compound annual growth of 21%.^{[51] footnote}

Digital payment rails trends.

CommerceHealthcare^® tracking provides current data that highlights progress in leading payment types:

• ACH . In the first quarter of 2026, healthcare saw 131 million ACH transactions, a nearly 5% rise over the prior year.^[52] Commerce Bank participates as a top 50 U.S. institution by volume of ACH origination and receipt.
• Virtual credit cards. Virtual cards are expected to grow at a rate of nearly 19% per year through 2031.^[53] The largest growth component (4.4 percentage points) comes from “accelerating B2B adoption of virtual cards for accounts payable automation.”
• Near-real-time payments. Near-instant bank-to-bank payments through the Clearing House RTP network are sizeable. In Q1 2026 alone, there were 128 million transactions totaling $480 billion.^[54]
• Digital wallets. The mobile wallet market is expected to more than triple between 2026 and 2030.^[55] There were 4.4 billion digital wallet users worldwide in 2025.^[56] Traditional credit cards are starting to be issued directly into wallets.^[57]

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• Embedded finance. Wallets can be part of a broader solution called embedded finance. This concept involves “financial products placed inside non-bank digital platforms,” and the market is anticipated to scale from $74 billion in 2025 to $371 billion by 2036.^[58] “Super apps” bundle digital payments with multiple services. Healthcare anticipates a 33% compound growth rate in these apps through 2031.^[59]
• Stablecoins. Stablecoins are digital assets designed to maintain a dollar-like steady value backed up by reserves. They offer a nearly instant mode of payment and are touted as supporting highly secure transactions. It’s too early to gauge consumer acceptance as a payment mode, and most use to date has been for purchase of cryptocurrencies.

It’s often suggested that healthcare will lag in adoption of these digital rails due to the preponderance of older patients who are less likely to be technologically adept. However, recent surveys tell a different story. Among adults over the age of 50, 63% used digital finance or banking services within past three months, including solid engagement with online banking, peer-to-peer money transfer, and mobile wallets.^{[60] footnote}

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Digital processes on the rise.

Trends Report noted that digital transformation extends beyond payments to a variety of financial transactions. Below are updates on three featured in Trends Report evidence rising attention and development:

• Credit decisioning. A study examined the role of AI in credit analytics. The researchers pitted a simulated AI model against traditional methods using real-world data. The AI-enhanced process generated “a 30% reduction in loan processing times and improved prediction accuracy, particularly for underrepresented borrower groups.”^[61]
• Smart contracts. Blockchain technology aims to usher in private and encrypted “smart contracts.” The global healthcare smart contracts market is projected to grow from $4.1 billion in 2026 to $19.2 billion by 2034.^[62]
• Intelligent payment routing. AI agents are being applied to intelligent routing systems where they decide in milliseconds which payment path is optimal based on cost, regulatory issues, and other considerations.^[63]

Cybersecurity.

The third technology theme in Trends Report stated that Cybersecurity Stays Top of Mind. Healthcare cyber incidents grew again in 2025 and remain an evergreen issue.^{[64] footnote} Advanced technology is fueling the assault. Automated bots are said to make up over half of today’s internet traffic and “relentlessly probe every public website for simple flaws.”^{[65] footnote}

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Scanning the landscape at mid-year reveals an issue gaining prominence. AI agents being deployed in organizations can be hacked. Insider breaches can result because the targeted agents have access to sensitive internal information. With an estimated 45 digital identities per employee, continuous network monitoring for unsanctioned AI apps or unusual data access patterns is a complex undertaking.^{[66] footnote}

AI also offers new defenses. Autonomous systems may “fundamentally shift the defensive posture of critical infrastructure, finding and closing vulnerabilities faster than any human team could.”^{[67] footnote}

Financial fraud continues to demand attention. Common attacks include fraudulent claims to health insurance, identity theft and mail fraud. One in five respondents to a Federal Reserve survey has experienced financial fraud, involving a range of vehicles on top of credit cards.^{[68] footnote} Half lost at least $500 and one-fourth lost $1,800 or more.

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Compliance with privacy policies is also vital. A business survey revealed that 52% of those employees using an AI platform had received no security or privacy training, and 43% admitted sharing sensitive information with AI without their employers’ knowledge.^{[69] footnote}

Leadership directions updates.

Pressure Mounting to Strengthen the Healthcare Ecosystem was a Trends Report theme capturing the growing call for systemic reform. Technology’s fast-paced developments are amplifying the pressure on organizations. Several recent analyses elaborate on what constitutes the desired healthcare ecosystem.

Fully integrated digital intelligence.

Creating a “purpose-built ecosystem” requires enterprise infrastructure that is “fully intelligent and able to recognize and adapt to the rapidly changing, information-rich environment around it.”^{[70] footnote}

“Connected” organizations must be superseded by “integrated, unified digital ecosystems” relying on interoperability frameworks.^{[71] footnote}

Complete user alignment.

One study observed a dichotomy between expectations of clinicians and patients regarding AI. The former want AI to solve system-level complexity issues, whereas the latter look to advanced technology to help with their personal health journey. A responsive ecosystem must reconcile these goals to “truly enrich the healthcare experience.”^{[72] footnote}

Ability to drive growth.

Health systems believe that growth today demands more than just scale. It requires agility, integration, and ecosystem leverage.^{[73] footnote} Alliances will be essential to such leverage. Selecting the right partners can be challenging. For example, there are thousands of financial technology companies, and many are early-stage and lack the experience and reliability of banks and traditional financial institutions.

Conclusion.

Many of the trends discussed in the December CommerceHealthcare^® report have come into sharper focus and assumed greater intensity in the first half of 2026. The financial picture is relatively stable, though still precarious for most organizations. Healthcare’s strides in automating financial processes and improving patient financial experiences are impressive, though incomplete. Patient affordability and reimbursement changes are clear risks, while AI and technology look increasingly beneficial.

Many believe healthcare is approaching a tipping point that will require fundamental technology, economic, and structural transformation. CommerceHealthcare^® is poised to help providers navigate that transformation and will continue to provide decision-makers with research and analysis to inform their planning.

CommerceHealthcare^® solutions are provided by Commerce Bank.

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Archive:

• Healthcare finance trends for 2026: A dynamic mix of opportunity and risk.
• Progress amid uncertainty: A mid-year update on 2025 healthcare finance trends.
• Healthcare Finance Trends for 2025: Accelerating Change
• Healthcare Finance Trends for 2024
• Healthcare Finance Trends for 2024: An Updated Look
• Healthcare Finance Trends for 2023
• Healthcare Finance Trends for 2023: Mid-Year Update
• 2022 Healthcare Financial Trends
• 2021 Healthcare Trends
• Healthcare Investment Trends and Strategies for 2021
• 2020 Healthcare Trends
• Healthcare Finance Trends 2019 eBook