Healthcare spending set to double by 2040 unless AI boosts productivity
Global healthcare spending will nearly double to $23.1 trillion by 2040 unless systems adopt technology at scale, according to analysis from Oliver Wyman. The consultancy warned that without intervention, aging populations, labor shortages, and inefficiencies will push annual costs from the current $11.8 trillion higher than economic growth across most major regions.
Of the projected $11.3 trillion increase through 2040, roughly $2.7 trillion stems from population growth alone. The remaining $8.6 trillion reflects rising system inefficiencies as healthcare struggles to meet demand with fewer workers and fragmented operations.
AI and automation could offset 60% of cost growth
AI, robotics, and automation offer one of the few credible levers to contain spending growth. Oliver Wyman found these technologies could offset up to 60% of projected cost increases if adoption is coordinated and backed by strong institutional frameworks.
The consultancy modeled three adoption scenarios through 2040. Under conservative "incremental" adoption, annual savings would reach $1.1 trillion by 2040-a 4% reduction in projected costs. A more aggressive "breakthrough" scenario could deliver $5.1 trillion in annual savings, or a 22% reduction in forecast spending.
These savings would span clinical, administrative, and operational domains across provider systems, pharmaceutical companies, medical device manufacturers, and payers.
Regional spending and current baselines
In 2025, North America accounted for $5.5 trillion of global healthcare spending, Europe for $2.6 trillion, Asia's leading economies for $1.2 trillion, and other developing markets for $2.5 trillion.
Growth creates both cost and opportunity
Oliver Wyman framed the productivity reset as a dual opportunity: cost containment and structural growth. Technology investments would create new markets in AI platforms, robotics, medical devices, and data infrastructure.
From an insurance perspective, this shift increases demand for specialist technology, cyber, product liability, and clinical trial coverage. Health and life insurers face pressure to adjust pricing and product design to reflect technology-enabled care pathways.
Cyber risk compounds technology adoption
Healthcare's digitization introduces security challenges. Allianz's 2026 Risk Barometer ranked artificial intelligence as the second-highest global business threat, with cyber incidents remaining the top concern for the fifth consecutive year. The report warned that AI is "supercharging threats, increasing the attack surface and adding to existing vulnerabilities."
As healthcare systems adopt new technologies, insurers and brokers are becoming partners in financing and de-risking the transformation-not just as claims payers, but as advisors on technology governance and resilience.
Learn more about AI for Healthcare and AI Agents & Automation to understand how these technologies are reshaping the sector.
Your membership also unlocks:
