Artificial intelligence is poised to become a major force in healthcare. The technology is developing at breakneck speed, and both payers and providers are examining the potential use cases, with a survey revealing that 73% of organizations plan on growing their financial commitments to the technology. However, AI is still new, and reimbursement remains a significant hurdle.
Reimbursement for AI-driven devices and processes is one of the most pressing issues in the industry. Navigating this complex landscape can hinder the adoption of new AI technologies. Dr. Brit Berry-Pusey, COO of AI cancer-mapping startup Avenda Health, notes that while her company secured Medicare reimbursement, it was only the fifth AI startup to achieve this milestone.
Currently, the approval process for new devices can take up to seven years from FDA clearance to establish reimbursement payment structures. ‘Unfortunately, the way reimbursement is set up in the U.S. disincentivizes new technologies,’ said Berry-Pusey. She emphasizes that slow reimbursement processes discourage innovation.
Another challenge is the lengthy application process. New devices undergo a rigorous review, with the company’s fate hanging on a panel’s vote, followed by a year-long waiting period for the code to take effect. As Berry-Pusey explains, ‘It can be challenging. It’s not easy for small companies.’
Growing Confidence in AI Potential
Despite these hurdles, AI’s potential in healthcare is being increasingly recognized. A Define Ventures survey highlights that three-quarters of health system leaders and insurance executives plan on investing more in AI. Furthermore, 73% have established governance structures to align AI initiatives with their organizational values.
Both payers and providers view AI as transformative, with 54% expressing confidence in its potential to reshape patient and clinician experiences in the coming years. While 33% believe AI will decrease healthcare costs, the cautious optimism is evident as 76% are launching AI pilot programs before broader implementation.
With 15% of providers and 25% of payers reporting established AI strategies, the healthcare sector is becoming more committed to AI integration.
Innovative Use Cases for AI
Recent analyses show potential for AI to improve revenue cycle performance. A Guidehouse analysis found that nearly half of healthcare leaders reported low net collection yields, pointing to a significant opportunity for improvement. Patrick Murphy from TruBridge notes, ‘Seventy-five percent of hospitals are working on an AI strategy to tackle revenue cycle challenges.’
Additionally, major organizations like the Cleveland Clinic and the Novo Nordisk Foundation are investing in AI programs, showcasing the growing commitment to technological advancement.
Challenges Ahead
Berry-Pusey points out challenges related to reimbursement, which she believes may slow innovation. Historical proposals aimed at improving the situation have not yet come to fruition. However, she remains optimistic. ‘It’s a really, really exciting time,’ she states. ‘Hopefully more and more people who have the power to change some of the hurdles we’re facing will see the value.’
As healthcare continues to evolve with AI, addressing the reimbursement landscape will be crucial for harnessing its full potential and ensuring equitable access for all patients.
- 0 Comments
- Reimbursement