Providers trail payers in healthcare AI action

If putting an AI plan in place were a team sport, the Payers would be outpacing the Providers quite handily. 

This is to say that 25% of healthcare payers but only 15% of providers have an established AI strategy in 2024. 

The finding is from a survey of 150 executives from both spheres. The project was conducted by Bain & Company with KLAS Research. Bain posted an analysis of the findings Sep. 17. Other key findings in the report: 

• 75% of providers and payers say they increased IT spending over the past year, a trend that is likely to continue, the report’s authors predict. 
• 70% of respondents were directly affected by the cyberattack on Change Healthcare and are spending more on cybersecurity.
• The 15% rate of strategy adoption among provider respondents may seem modest, but it represents a 10% bounce over the 5% providers notched in last year’s survey. 

The authors offer a handful of informative observations, including these five: 

1. Post-pandemic, providers and payers are inclined to experiment with technology. 

“Consistent with our findings over the past several years, providers and payers place a premium on technology; in our survey of 150 U.S. providers and payers, about 75% of respondents cite increased IT investments over the past year,” the authors comment. “We expect this trend to continue.” More:

‘Provider organizations emphasize digital transformation aimed at optimizing operations and reducing clinician burden. Payer IT efforts seek to improve payments via risk adjustment and quality programs, and they seek to lower medical loss ratios by optimizing payment integrity.’

2. Providers and payers alike are exploring AI-supported solutions to enhance decision-making, improve operational efficiency, and deliver care and engagement. 

Providers have made strides over the past year, as evidenced by the sector’s AI strategy growth from 5% to 15% from 2023 to 2024. 

‘Payers are at a roughly equivalent place in terms of AI strategy definition when one controls for organization size. And a healthy majority of both types of organizations are optimistic about implementing generative AI.’

3. Both providers and payers are optimistic about implementing generative AI. 

Providers have begun to pilot generative AI in clinical applications, including clinical documentation and decision support tools, the authors note. Pilots involving ambient clinical documentation “have been particularly successful in reducing clinician administrative burden and improving the patient experience,” they add. 

‘Payers cite contact center and member chatbot support as the first generative AI use cases gaining traction. These deployments aim to mitigate the impact of contact center labor pressures and can help raise staff skills and deliver more tailored, empathetic communications to members.’

4. Certain barriers continue to hinder widespread adoption of generative AI by payers as well as providers. 

Both providers and payers cite regulatory and legal considerations, cost and accuracy shortcomings such as AI hallucinations as main hurdles to implementation, the analysts found. 

‘Additionally, there is a growing need for robust governance frameworks, transparency, and accountability mechanisms to ensure responsible and ethical use of AI in healthcare.’

5. Cybersecurity concerns and rising threats are expected to shape investment choices and vendor selection.

Following the Change Healthcare cybersecurity incident, organizations are strengthening their IT infrastructure against threats, the authors report. 

‘Clinical workflow optimization remains a high priority as providers seek to streamline processes, reduce administrative burden and increase utilization of labor, capital equipment and facilities. Within this category, patient flow solutions stand out.’

“AI tools have great potential to improve outcomes in the four quadrants of healthcare’s quadruple aims: enhancing the patient experience, improving population health, reducing cost and improving the provider experience,” Bain and KLAS conclude. “In the years ahead, AI looks set to deliver value on each of these fronts, though the journey will be gradual.”

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