An increasingly acute patient population

An aging U.S. population alongside the shift of lower-acuity care from hospitals to outpatient facilities has led to an increase in health systems' case mix index, which measures care complexity, Kacik reports.

That index has increased between 1% and 3% each year from 2024 through the first half of 2026, according to data from Strata Decision Technology.

According to Alina Henderson, VP of healthcare solutions and partnerships at Strata, while higher-acuity care typically leads to higher pay, it might not offset the costs of specialized labor, medications, supplies, and monitoring.

"Even where reimbursement rises, stronger margins aren't guaranteed," Henderson said.

As a result, health systems have had to adapt and revamp how they provide care, focusing on three key areas that executives said have shown some promising early results.

3 areas health systems are emphasizing to care for sicker patients

1. Technology

Todd Jones, chief strategy and ambulatory officer at BayCare Health System, said the number of ED visits that have turned into inpatient stays at his health system increased 17% from 2023 to 2025.

As a result, more patients have required MRIs and other imaging, so BayCare has utilized an AI tool to cut scan turnaround times in half, Jones said. The software has helped get scans to radiologists quicker and has increased the number of scans performed by 15% from 2024 to 2025.

Jones added that alongside increased MRI output, BayCare is expanding its telehealth capacity and upgrading data analytics systemwide to reduce patients' length of stay.

Ajay Kumar, chief clinical officer at Hartford Healthcare, said his health system has hundreds of ongoing redesign and cost-reduction projects to help standardize care.

"Much of our reimbursement rates are fixed, so we don't have a lot of elasticity as rising costs along with Medicaid payment changes create significant pressure," Kumar said. "That has required a tremendous amount of operational rigor."

Hartford is using AI to improve OR capacity, evaluating blood inventory and transfusion practices to reduce waste, and standardizing equipment and supply purchases to reduce costs.

According to Kumar, Hartford has grown its care logistics center and telehealth capacity in an effort to get patients admitted and discharged quicker while also preparing a tool that forecasts patient volumes.

"We are committed to building not only a healthcare system designed for today, but also one that can provide the increasing level of care complexity to come," Kumar said.

3. Care coordination

Health systems that don't properly coordinate care could have trouble recruiting and retaining physicians, Kacik reports. A key part of care coordination is moving less complex care to outpatient facilities to reduce costs and free inpatient space.

Therese Hudson-Jinks, CNO, chief experience officer, and SVP of patient care services at Tufts Medical Center, said that her health system has addressed rising care complexity through a number of care coordination programs.

For example, Tufts convenes teams that include clinicians, case managers, physical therapists, respiratory therapists, and social workers to coordinate diagnostic testing. Meanwhile, attending physicians and lead nurses keep discharge plans on track, Hudson-Jinks said, adding that every person has a role.

Tufts also regularly sends physicians to community hospitals and has expanded its workforce education programs at those facilities to help increase capacity at its academic medical center.

According to Hudson-Jinks, these programs have helped Tufts decrease average length of stay by 20% and increase transfer cases by 24% over the past year.

"This is far from over," Hudson-Jinks said. "Patients are still coming in very sick and timeliness of care really matters."