AI Is Processing More Healthcare Transactions, Not Reducing Costs
Artificial intelligence is accelerating the volume of transactions in healthcare without improving efficiency or lowering costs, according to a Peterson Health Technology Institute report released this week.
The findings come from interviews with health system executives, insurers, federal agencies, and technology vendors. AI tools are reducing administrative burden on providers, but the underlying economics don't improve.
The Problem: More Volume, Same Complexity
AI allows providers and payers to process more transactions faster. That sounds efficient. It isn't.
More prior authorization submissions flow between providers and payers. Billing activity increases. Back-and-forth communication multiplies. None of this addresses the structural inefficiencies that drive healthcare's $350 billion annual administrative waste problem.
AI-driven billing is already increasing healthcare spending. Better documentation and coding-enabled by AI tools-drive higher reimbursement levels and contribute to medical cost inflation.
Where AI Is Being Deployed
Providers use AI to automate prior authorization submissions and assist with medical coding. Health plans use AI to evaluate authorization requests and process claims.
Ambient scribing and AI-assisted coding capture clinical complexity and automate billing on the provider side. Plans deploy AI to review and process the resulting claims.
The result: more complete transactions flowing through a system designed to handle complexity through manual review.
The ROI Question
Joe Longo, senior vice president and chief digital information officer at Parkland Health, said executives face skepticism about hard return on investment from AI deployments.
But ROI isn't the only measure. Ambient AI reduces physician burnout by eliminating documentation work outside clinical hours-what Longo calls "pajama time."
"That's a hard ROI miss," Longo said. "But is it worth it? Yes."
The report reflects broader findings from the HIMSS26 Global Conference in March: AI may not deliver measurable cost savings, but it reduces clinical burden.
For healthcare professionals, the takeaway is straightforward. AI can ease your workload without necessarily improving your organization's bottom line-at least not yet. Understanding where AI actually adds value requires looking beyond transaction volume.
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