Axios Pro: Health Tech Deals

August 08, 2023

Axios Pro Exclusive Content

Happy Tuesday, Health Tech wonks.

1 big thing: Health systems lag on AI strategy

Illustration of code in a health cross symbol

Illustration: Aïda Amer/Axios

Generative AI can help health systems improve margins, but only 6% of them have a strategy ready, according to a recent report from Bain & Co.

Why it matters: The hospital sector is seeing its most challenging year since 2020, with many systems buckling under wage inflation and staffing shortages, Aaron writes.

What's happening: Most health systems are eyeing near-term generative AI applications such as improving clinical documentation, structuring and analyzing patient data, and optimizing workflows.

  • For example, the University of Kansas Health System recently partnered with generative AI platform Abridge to reduce documentation burden.

What's next: Hospitals hope to start using generative AI for predictive analytics, clinical decisions and care recommendations.

What they're saying: "It's time to play offense — or be forced to play defense later," write Bain partners and lead authors Eric Berger and Margaret Dries.

  • "Choosing from the laundry list of generative AI applications is daunting," they add, noting companies risk "overinvesting in the wrong opportunities and underinvesting in the right ones."

Be smart: Amid a noisy generative AI market, focus and prioritization are persistent challenges for health systems, the report notes.

  • "In many boardrooms, executives are debating overwhelming lists of potential generative AI investments, only to deem them incomplete or outdated given the dizzying pace of innovation," Berger and Dries write.
  • Hospitals should start small, piloting low-risk generative AI applications with a narrow focus, such as billing or scheduling, the report suggests.
  • Health systems should also be weighing a buy-build-partner strategy when it comes to generative AI.

The bottom line: While "a wait-and-see approach is a tempting prospect," health systems shouldn't rest on their laurels when it comes to implementing new AI.

View archive