Healthcare C-suite leaders are trying to keep pace with rapid changes in U.S. economic and regulatory policies in the first four months of the second Trump administration.
Among 700 business executives across six industries, nearly half (48%) of business executives rank economic policy among the top three factors driving strategic change over the next one to two years, according to a new PwC May pulse survey.
For healthcare executives, persistent policy and market volatility is a bigger concern, with six out of 10 (61%) rethinking short-term business strategies due to economic policies.
Leaders at healthcare organizations also cited a number of other factors affecting short-term strategic changes—artificial intelligence and data regulations (56%), U.S. trade policy (44%) and U.S. federal government spending and budget policy (37%). Healthcare C-suite leaders seem less concerned about corporate tax policy, cited by 34% as a factor driving short-term strategic changes, as well as the U.S. antitrust and competition environment (24%), climate policy (22%) and U.S. immigration policy (22%).
About half (48%) of the business executives surveyed expect the current uncertainty to last less than a year, but many anticipate it could extend through the next presidential election.
PwC surveyed nearly 700 U.S. executives between May 1 and May 8, with 6% of respondents from public and private companies in the healthcare industry. The firm notes that the survey was conducted in the first week of May, before the U.S. and China agreed to suspend tariffs for 90 days.
The survey offers a real-time look at how healthcare leaders are adapting to recent shifts, the firm said.
Cyber threats, economic uncertainty and a labor crunch are top of mind for healthcare execs as they navigate the current business volatility.
Cyberattacks top the list for healthcare executives, with 90% flagging it as a moderate or serious risk—the highest among all industries—reflecting the ongoing fallout from major cyber incidents that have disrupted healthcare systems.
Macroeconomic uncertainty was cited as another top-tier risk (90% of healthcare respondents) along with margin pressure affecting earnings (85%).
Regulatory complexity and access to skilled labor also were flagged as serious risks to their companies, according to the survey.
Providers face shortages as they care for an aging population with increasingly complex needs, while pharma companies require specialized expertise in biomanufacturing, cell therapies and regulatory compliance. Technology can be used to mitigate some of the labor crunch, but it requires investing in change management and training, PwC points out in the report. The AI wave is also driving increased demand for talent proficient in AI, machine learning and data analytics.
Healthcare leaders will need to stay nimble to steer businesses through the current uncertainty, PwC analysts wrote.
“This means focusing on customers, making processes more efficient, significantly lowering cost structures and doubling down on the fundamentals of quality, compliance and cyber protection,” PwC wrote.
Healthcare organizations need robust scenario planning and regular leadership dialogue on options and contingencies. “Value pools are shifting, care delivery models are changing and technology is advancing, and strategic agendas need to adapt,” PwC wrote.
In the face of these challenges, healthcare executives are making a range of operational adjustments, according to the survey findings. These adjustments include revising financial forecasts and budgets, implementing cost reductions, assessing tariff impacts and renegotiating supplier prices. In some cases, healthcare companies are shoring manufacturing operations.
“Providers are bracing for rising care delivery costs while pharma and medtech executives are evaluating supply chain shifts. At the same time, drug pricing remains a central concern for pharma and payers,” PwC wrote.
Business leaders see opportunity amid the uncertainty. A third (32%) of executives across all industries say there will be more opportunities 12 months from now, while 23% say there will be more challenges.
According to the survey results across all the industries, business leaders are starting to lay the foundations for future opportunities. They’re looking at cost reductions (with 62% either taking initial steps or already beyond initial steps), adjusting financial forecasts and budgets (59%) and diversifying suppliers (58%), the PwC survey found.
According the PwC analysts, the biggest risk in the current environment isn’t volatility but inaction. “Leading organizations are taking action and finding opportunities despite a lack of clarity. The bigger risk is missing the moment and waiting for conditions to stabilize—a wait that could be futile,” the report authors wrote.
A sizable share (57%) of business executives say they’re missing opportunities because they can’t make decisions quickly enough.
The current environment may require a two-speed approach, PwC analysts noted, with executives making rapid tactical moves in the short term to manage volatility while also planning coordinated long-term strategies to compete more effectively in the future.
The report offers a number of recommendations to implement this “two-speed strategy”:
- Make data a foundational capability. Smart companies are investing to get data that are accurate, current and easy to access. They’re also making sure the right decision-makers have the right information at the right time so they can move faster, act with confidence and adapt in real time.
- Consider circular business models. Explore ways to reuse products, components and materials, which can help improve or protect margins, meet sustainability goals and reduce potential tariff exposure. Companies also gain more control over their supply chain, which is increasingly valuable in a volatile trade and regulatory environment.
- Keep sight of the bigger picture. Trimming expenses might deliver quick wins, but if those cuts end up sacrificing long-term investments, they can stunt future growth, stall innovation and leave the business less resilient when challenges hit.
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