Health insurers stand to gain substantial benefits if they can fully integrate AI and automation into the end-to-end processes of each part of their business, say partner Jessica Lamb and senior partner Shubham Singhal. They estimate that for every $10 billion in revenues, payers could save $150 million to $300 million in administrative costs and $380 million to $970 million in medical costs. Moreover, these technologies can help generate $260 million to $1,240 million in additional revenue. These estimates apply to an average-performing payer, so lower performers might experience even greater improvements, potentially surpassing their competitors.
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A series of 3 area squares shows the estimated economic impact of AI use for every $10 billion of medical services revenue, in millions of dollars. The first square shows an estimated $150 million–$300 million in administrative cost savings from AI use; the second shows an estimated $380 million–$970 million in medical cost savings from AI use; the third shows an estimated $260 million–$1,240 million revenue increase from AI use.
Footnote: High-end estimate is based on the average payer’s capabilities and workflows—and assumes all next-generation AI/automation capabilities are adopted, which is unlikely in practice. Low-end estimate of impact is based on high-performing and more technologically advanced payer, again assuming all next-generation capabilities are adopted.
Source: National Association Insurance Commissioners financial statements, 2022.
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To read the article, see “The AI opportunity: How payers can capture it now,” June 5, 2024.