If one word defined how hospital and health system CEOs talked about their organizations in 2026, it was efficiency. The term showed up in year-ahead priority lists, turnaround strategies, restructuring announcements and layoff notices alike — a sign of just how much financial pressure health systems are under, whether they are stabilizing or still in the red.
That pressure is coming from multiple directions: hospitals continuing to be underpaid by Medicare and Medicaid, claim denials that keep rising, labor costs that have not fully normalized since the pandemic-era wage spikes, and continued uncertainty over what federal reimbursement policy will bring in 2027.
For CEOs navigating all of it, “efficiency” has become the term that covers both disciplined financial recovery and the harder calls — job cuts, hospital mergers, leadership consolidation — that come with it.
Efficiency as the engine of a turnaround
St. Louis-based Ascension narrowed its operating loss by $371 million in fiscal 2026, closing out a three-year recovery from a $1.8 billion operating loss. President and CEO Eduardo Conrado said in a June “Becker’s Healthcare Podcast” interview that the recovery came down to the basics.
“We looked at the operating model. How do we run efficiently? How do we drive out into a proper site of care? And then how do we manage a revenue cycle?” he said. “That, to me, was just the basics in terms of how do we have a consistent way to operate across all the ministries that we’re in.”
Ngozi Ezike, MD, president and CEO of Sinai Chicago, pointed to the same lever for 2026 in a January Becker’s article: strengthening core operations by improving clinical and operational efficiency, particularly through revenue cycle management and cost control.
Deborah Visconi, president and CEO of Bergen New Bridge Medical Center in Paramus, N.J., also told Becker’s in January that her top priority was “disciplined, mission-aligned growth founded in strong operational fundamentals,” adding that health systems need “efficiency, standardization and accountability” to build financial strength before investing in new initiatives.
And Pete November, president and CEO of New Orleans-based Ochsner Health, framed efficiency as the balance point between growth and stability.
“Our top priority for 2026 is striking a sustainable balance between financial stability and growth through smart, efficient practices,” he said in January. “For Ochsner Health, this means using our culture of innovation and operational excellence to improve efficiency without compromising high-quality care.”
Efficiency as the reason behind restructurings, cuts
That same word extends well beyond turnaround strategy. It is also the term systems reach for when explaining mergers, leadership changes and workforce reductions.
Mobile, Ala.-based USA Health recently appointed Josh Snow market CEO of its adult hospitals division, expanding his oversight of University Hospital — a move the system said was designed to improve coordination and efficiency across its adult hospitals. Urbana, Ill.-based Carle Health cited the same rationale in announcing that its Methodist and Proctor hospitals in Peoria, Ill., will begin operating as one hospital with two campuses starting in November, calling it a structure that “enhances operational efficiency and flexibility.”
Efficiency shows up even more often in 2026’s wave of workforce reductions. Of the 60-plus health systems that have announced job cuts this year, several have explicitly tied the decision to improving operational efficiency. San Francisco-based Dignity Health laid off 139 employees across two Southern California hospitals in August; a spokesperson said the system was “realigning our resources and enhancing operational efficiencies to ensure we can continually serve our patients well into the future.”
Burlington-based University of Vermont Health began implementing a 199-position workforce reduction in September, with a spokesperson citing the need to reduce expenses and improve efficiency ahead of a projected $300 million drop in revenue over the next few years.
