A Look Back at Healthcare in 2024
At the end of the year, most companies post forward-looking articles about what’s to come in the next year. (Yeah, we did it too.) But, taking a page from AI’s book, we can only improve if we are continuously learning and getting feedback from past experiences.
So, we first have to reflect on the year behind us. What happened in healthcare in 2024 and how can we take those learnings into 2025? We’ll cover predictions from 2023 and how they actually panned out in 2024, plus the state of AI in healthcare in 2024 and how health plans have been using AI over the past 12 months.
Predictions from 2023
The predictions made in 2023 painted an optimistic picture: a year where healthcare enterprises would begin reaping tangible value from generative AI (GenAI) and specialized machine learning tools. While some of these aspirations were realized, the road to transformative AI adoption in healthcare still has its share of detours and caution signs, but this also means opportunities for growth.
When experts forecasted the state of AI in 2024, the tone was one of cautious optimism. Michael Howell, Chief Clinical Officer at Google, predicted that healthcare enterprises would finally see value from GenAI. Alexa Von Tobel, Founder and Managing Partner at Inspired Capital, saw AI flourishing in areas like billing, claims processing, and administrative support, while Maxime Vermeir, Senior Director of AI Strategy at ABBYY, emphasized the potential of specialized, contextual AI over general-purpose systems.
Fast forward to today. While the year wasn’t a seismic shift, it was definitely a steady march forward in terms of AI adoption. No, GenAI didn’t completely revolutionize healthcare . . . yet, but its role expanded meaningfully in focused areas. For example, AI-driven tools gained traction in claims processing—both in pre- and post-payment.
However, the optimism came with caveats. Sriram Devarakonda, CTO of Cardamom Health, for example, predicted an increased scrutiny on AI vendors. Healthcare organizations have begun to demand transparency around AI models—asking not just what they can do, but how they do it. This trend marks a turning point: excitement about AI is giving way to a more critical assessment of its risks and benefits.
The State of AI in Healthcare and Insurance in 2024
AI in healthcare in 2024 was less about immediate transformation and more about laying the groundwork for future breakthroughs. While some health plans and providers began to see incremental benefits, not everyone has fully embraced AI. According to McKinsey, “AI and automation could lower administrative and medical costs and increase revenue. But [health plans] have yet to mobilize to transform their organizations to capture this opportunity.”
AI’s role in claims adjudication—a historically manual and labor-intensive process—highlighted both its potential and its pitfalls. On one hand, AI brought transformative automation, speeding up while simultaneously increasing the efficiency of claims auditing. On the other hand, however, the use of unfettered AI to deny claims raised ethical and regulatory questions, leading to heightened scrutiny. This tension underscores the importance of oversight in balancing efficiency with transparency, a conversation that will likely persist.
For health plans, AI is still a latent technology with room for growth, but the prognosis is positive. According to a survey of senior decision makers in GenAI strategy or data analytics in the insurance sector, 89% of insurance companies plan to invest in GenAI in the next year.
Investment and Adoption Trends
The numbers from 2024 paint a clear picture: healthcare organizations are committed to AI, but they’re still trying to understand it while figuring out how to make it work for their business needs.
A recent survey of health plan and provider executives from Define Ventures, reflects widespread recognition of AI’s potential, even as its full value remains untapped.
- AI as a Priority: some text
- 53% of respondents identified AI as an urgent priority
- 95% said it was at least somewhat important
- Pilots and Use Cases: some text
- 76% of organizations are focusing on establishing AI pilots
- 71% of organizations are still identifying use cases
- Key Use Cases: some text
- Member experience (68%)
- Clinical management for case and care planning (63%)
- Administrative tasks like prior authorization (56%)
- Population health (44%)
- Billing and claims (25%)
The diversity of these use cases reflects the broad applicability of AI in healthcare, but it also highlights a key challenge: no single area has yet emerged as a dominant driver of ROI.
Opportunities and Challenges Ahead
If there’s one thing 2024 taught us, it’s that AI in healthcare is more of an evolution than a revolution. The technology’s potential is undeniable, but its adoption is fraught with perceived complexities.
- Investment Momentum: The willingness of health plans and providers to invest in AI is a positive sign. Budgets are increasing, pilots are proliferating, and use cases are expanding. These efforts will likely pay dividends in the years to come, especially as organizations refine their approaches to implementation.
- Generative AI’s Potential: GenAI is beginning to show promise in areas like claims triage and member communication. As the technology matures, it could become a cornerstone of healthcare administration.
- Scrutiny and Safeguards: The increased scrutiny on AI tools is both a challenge and an opportunity. On one hand, it slows down adoption, on the other, it forces vendors to build better, more transparent systems. This focus on ethical AI is essential in an industry where decisions can have life-or-death consequences.
- Ethical Considerations: The current controversies surrounding AI-driven claim denials serve as a reminder that technology is only as good as the people and policies guiding its use. Ensuring fairness, transparency, and accountability will be critical as AI continues to integrate into healthcare workflows.
Lessons from 2024
The predictions made at the start of 2024 were not wrong, but they were perhaps a bit premature. AI has certainly made inroads into healthcare, but its transformative potential remains largely untapped. The good news? The groundwork is being laid for a future where AI could significantly improve efficiency, reduce costs, and enhance patient care.
For health plan administrators, the key takeaway from 2024 is that AI adoption is a journey, not a destination. The steps taken this year—piloting new technologies, examining their ethical implications, and identifying the most promising use cases—are all critical milestones on the path to realizing AI’s full potential.
As we move into 2025, the focus will likely shift from experimentation to optimization. The question is no longer if AI will transform healthcare, but how and when. And, if 2024 is any indication, the best is yet to come.
To learn more about how Machinify can help your health plan stay ahead of the AI curve, schedule a demo today.
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