Why AI advances depend on other disruptive changes in the industry

There’s almost unbridled optimism about how artificial intelligence will play in healthcare, there will be bigger technology stories ahead in 2024.

All the major prognosticators have weighed in healthcare 2024, and most of it is focused on how artificial intelligence will transform patient outcomes and services. The AI forecasts are not fiction; the technology behind predictions is either currently developed and moving closer to human cognitive ability – or possibly surpassing it – enabled by quantum computing.

AI will indeed be transformative and change the entire healthcare landscape. For example, patients will share their own data from wearables, home monitoring devices or responses to natural language processing interfaces to providers, and providers will respond with adjusted treatment during convenient and immediately scheduled telehealth sessions, with or without a face-to-face physician encounter. There will be tailored plans for patients across all health disciplines, from metabolic disease to cancer, facilitated by genetic data and by new AI-developed drugs. Likewise, there will be unassisted robotic surgery, avoiding wait times, or robotic assistants for patients in surgical recovery or at end of life, avoiding rehab and nursing homes.

No one doubts that AI will change healthcare eventually. But here’s the thing – 2024 is not its big year. As a result, we’re ignoring some of the events that will take place in 2024 and are likely to shape the future.

A bigger healthcare story for 2024

Artificial intelligence will play a continuing, meaningful and supportive role in healthcare. It will even do some amazing things, like predict life expectancies for patients with some conditions. Diagnostics will continue to get better. Natural language processing (NLP) will be incorporated in major EHRs and reduce physician documentation workloads. ChatGPT and other advances will facilitate technology development, communication and other functions.

To look at this realistically, however, these improvements are just progress notes. AI will make a big stand in healthcare, but it isn’t ready to actually transform it, even if individual AI products go forward. Three missing elements need to be in place first.

  • • Actors in healthcare must be ready to adopt AI technology, with money and urgency. Physicians and groups, hospital systems and other providers must have a business case for AI adoption. Only diagnostics, robotic surgery or similar specific services have compelling business cases that tie revenue streams with provider differentiation. We see AI advances in radiology, ophthalmology and plastics because there is a business case and capital to compel adoption, and groups with AI tools can ascend in the market and get returns on the investment.
  • • Slowed AI adoption through value-based care and risk-based payment models. In our economic reality, competition and payment models dictate providers’ financial viability and the pace of value-based care adoption. The fact is that the cost of not participating doesn’t currently affect revenues enough. Payers can make it imperative for health systems and generalist providers to move toward risk, and risk-based reimbursement will create the backward chain of incentives to improve outcomes.
  • • Data necessary to fuel AI advancements must be present. Traditional providers have actively resisted the aggregation of data that could be used to support AI, and even large systems are just now beginning to build the data infrastructure necessary. While claims or billing data can provide a base of data, clinical data – like laboratory values, condition staging information and longitudinal outcomes – is essential. More problematic is that data must be fed from a broad base of clinical providers serving any given patient. High quality demographic data, with social determinants of health, and financial and community sources will also be key to AI-enabled patient risk predictions.

3 predictions about continued disruption

An exit from the disruption of the healthcare business of the past several years would be a welcomed next step. But it won’t happen until there are shifts in the balance of power and resources. These will gather steam during 2024 and advance the case for adoption of artificial intelligence to manage an increasingly complex healthcare environment.

These three major trends will dominate conversations in 2024.

Corporate healthcare will continue to expand its reach and build strength. Healthcare has become big business. Optum became the largest employer of physicians in 2023, and overall physician employment became greater for corporate health care than for traditional providers. Capital is flowing into private-equity-backed practices and ACO enablers like Aledade, which now commands a large lead over other ACO companies. Not to be outdone, CVS Health and Amazon both completed major physician group purchases in 2023. In 2024, this trend will continue. In addition to the size and speed of the expansion, there are two noteworthy components of the corporate health expansion. First, these groups have business models rooted in value-based care and risk, meaning they are poised to align with payers, but they are also more apt to invest in data and AI tools.

Data expansion needed for AI adoption will surge. The decades-long digitalization of healthcare data is beginning to mature. Epic has cornered the largest part of the market, and we will see many smaller companies offering EHR systems go down with each year ahead. Part of this is fueled by policy from the Centers of Medicare & Medicaid Services, mandating that ACOs require participating providers’ systems to be certified, but consolidation among providers as well as development of ACOs accelerate the trend. Major health systems see healthcare data as an important asset, and some are experimenting with applying NLP to turn unstructured data into useful sources for SDOH and other needs. Another CMS requirement for ACOs requires reporting quality for all patients. Although a Medicare patient-only option has now been allowed, ACOs are increasingly eager to take advantage of the AI opportunities and realize that it will require data.

Physician shortages and other changes in delivery will increase, with patients enduring longer waits. Even in geographic areas with historically dense medical services, shortages are spiking. Physician specialties face increasing need by greater populations of patients with metabolic disease, cancers, cardiovascular diseases and advanced age. Wait times of as long as six months is not uncommon, even with insurance benefits backed by a large provider network. Consolidated health systems have often created bureaucratic barriers for patients, like call centers between patients and their existing practices. Expect patients to accelerate the trend of seeking care at retail clinics and urgent care centers, further deteriorating the bond between patients and traditional healthcare providers.

One fact to remember about the healthcare system in the U.S. during 2023 – almost no one is satisfied with it. Virtually all surveys of consumers and patients, physicians and executives inside the system have revealed low levels of satisfaction. On the other hand, there is great excitement in the periphery of the healthcare system, including policymakers and technology companies, about the future of healthcare. That says something important about what that future is: It’s going to be a lot different.

Theresa Hush is CEO of Roji Health Intelligence.

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