Healthcare execs say AI will reshape the industry, but are doing nothing about it

Hospitals are struggling with negative margins, talent shortages, and record inflation, all leading to more than half of them struggling financially. A Bain survey of health system executives showed that 60% of them see rising costs as their greatest concern, and further research shows that artificial intelligence may hold part of the answer, but executives are failing to act.

AI in health care: ©Phonlamai Photo - stock.adobe.com

The survey of reveals that 75% believe generative AI has reached a turning point in its ability to reshape the industry, yet only 6% have an established generative AI strategy.

"Providers and payers are looking for profit opportunities while also doubling down on employee morale, clinical care, and patient experience," said Eric Berger, a partner in Bain's Healthcare & Life Sciences practice, in a statement. "Many recognize the potential AI offers to boost productivity, yet they are acutely aware of the uncertainties around evolving technology. This uncertainty cuts both ways—while there is hype, there is also opportunity. Leading companies are taking this technology shift seriously and getting started with highly focused, low stakes use cases with some near-term ROI while building up the experience and confidence needed to invest in a more transformative vision."

Generative AI can mitigate some of providers' biggest issues, including clinician shortages and physician burnout. Some generative AI applications are already streamlining administrative tasks and allowing thinly stretched physicians to spend more time with patients, according to the report.

Resource and cost constraints, a lack of expertise, and regulatory and legal considerations are the largest barriers to implementing generative AI, according to surveyed executives.

The survey shows that many health systems are eyeing opportunities to reduce administrative burdens and enhance operational efficiency. They rank improving clinical documentation, structuring and analyzing patient data, and optimizing workflows as their top three priorities for the next 12 months. Looking ahead two to five years, executives are most interested in predictive analytics, clinical decision support, and treatment recommendations.

Bain researchers said that leading companies are forming a pragmatic strategy that considers current capabilities, regulations, and barriers to adoption, and recommends the following four strategies:

• Pilot low-risk applications with a narrow focus first. When gaining experience with currently available technology, companies are testing and learning their way to minimum viable products in low-risk, repeatable use cases. These quick wins are typically in areas where they already have the right data, can create tight guardrails, and see a strong potential return on investment.
• Decide to buy, partner, or build. CEOs will need to think about how to invest in different use cases based on availability of third-party technology and importance of the initiative
• Funnel cost savings and experience into bigger bets. As the technology matures and the value becomes clear, companies that generate savings, accumulate experience, and build organizational buy-in today will be best positioned for the next wave of more sophisticated, transformative use cases.
• Remember AI isn't a strategy unto itself. To build a true competitive advantage, top CEOs and CFOs are selective and discerning, ensuring that every AI initiative reinforces and enables their overarching goals.