Healthcare Hospital Economics in Transition

Capital structure review checklist

• Assess debt maturities: Identify upcoming obligations and evaluate refinancing opportunities.
• Monitor interest rate trends: Understand how rate movements could impact borrowing costs.
• Review covenant compliance: Ensure headroom exists for operational flexibility.
• Evaluate credit ratings: Confirm positioning for favorable pricing and access to capital.
• Discuss lending environment: Ask your banking partner about appetite for deals and current market conditions.
• Explore tenors and structures: Understand what terms are being offered and how they align with your strategy.
• Update liquidity strategy: Confirm lines of credit and contingency buffers are adequate for stress scenarios.

Building resilience with working capital

If liquidity creates flexibility, working capital creates opportunity. Improving revenue cycle management is one of the most powerful ways healthcare systems can strengthen resilience — because every day shaved off receivables translates into more cash on hand and more room to maneuver.

Days-cash-on-hand is a critical metric for most providers, yet it varies widely. Some systems operate with 30 days, others with 400. The right number depends on your organization’s risk profile, but if you’re light on cash, the question becomes, what steps are you taking to drive that number higher?

Kight frames it this way: “From a bank perspective, we can help accelerate receivables, delay payables and make sure you’re maximizing yield on excess liquidity. Increasing efficiency through revenue cycle management is key.”

Historically, these processes have been treated as back-office plumbing. Today, they’re a strategic lever for protecting margins and creating optionality.

Digital transformation amplifies this opportunity. As systems migrate to platforms like Epic, they can streamline payment workflows, reduce paper checks and adopt consumer-friendly solutions such as the U.S. Bank MedEpay™ patient payment portal to improve the patient experience and accelerate collections.

While most healthcare organizations are actively exploring generative AI to boost operational efficiency, it’s important to recognize that digital payment technologies are already harnessing AI-driven automation to deliver tangible results. These solutions not only streamline financial workflows but also enable smarter, faster decision-making — bringing the promise of AI directly into the heart of revenue cycle management.

For organizations with a large cash buffer, discipline matters too — deploying excess liquidity thoughtfully and reviewing strategies regularly ensures that cash works as hard as possible.

Modernizing accounts payable for even greater resilience

With working capital strategies in place, the next lever for building financial resilience is modernizing accounts payable (AP). As hospitals continue to navigate volatility, the AP function is evolving from a back-office necessity to a strategic asset.

“A strong payment strategy isn’t just about cutting checks faster. It’s about automating AP, moving away from paper and using payments to create value,” Kight says.

Automation in AP consolidates data, generates rebates, strengthens supplier relationships and frees teams for higher-value work. Most importantly, it provides financial leaders with real-time visibility, enabling smarter, faster decisions about cash flow, expenses and emerging trends. “It’s about giving the CFOs, the treasurers and all the revenue cycle management folks real-time visibility so they can make smarter calls,” Kight explains.

For example, one regional health system recently automated its AP workflows, replacing manual invoice processing with a digital platform. The result: Payment cycle times dropped by 40%, supplier discounts increased and finance staff were able to shift focus from routine tasks to strategic analysis, directly supporting the organization’s resilience goals.