Demystifying Artificial Intelligence | Market Insights™
December 12, 2018
Demystifying Artificial Intelligence: Definition and Characteristics
Demystifying Artificial Intelligence: Definition and Characteristics
New research predicts US$6 billion investment will drive innovations in patient identity verification, opioid abuse detection and individually tailored healthcare.
Healthcare organizations are pouring billions into embedded AI across the value chain, driving an estimated quadrupling of AI investments in the next three years, according to Everest Group. The firm predicts that healthcare AI investments will grow from US$1.5 billion in 2017 to exceed US$6 billion by 2020, representing a compound annual growth rate of 34 percent.
While AI is a relatively new area in the healthcare space and its adoption is in the nascent stage, digitalization of healthcare is accelerating healthcare enterprises’ interest in AI. AI has the potential to transform healthcare processes and dramatically reduce costs and improve efficiencies.
For example, healthcare payers are leveraging AI for product development, policy servicing, network management and claims management. Examples include:
Currently, the area where payers are adopting AI to the greatest extent is in care management.
Likewise, the highest adoption of AI by healthcare providers is for care and case management. Providers also are employing AI tools to:
These findings and more are discussed in Everest Group’s recently published report, “Dr. Robot Will See You Now: Unpacking the State of Artificial Intelligence in Healthcare – 2019.” The firm has analyzed the market from the vantage point of 27 leading healthcare enterprises and closely examined the distinctive attributes of the leaders, who are far ahead of the other industry participants in terms of AI capability maturity. The report identifies best practices, illustrates the impact generated, and offers proposed a roadmap for market stakeholders.
***Download a complimentary abstract of this report here. ***
“While healthcare enterprises are still in the nascent stages of AI adoption, the scale of opportunity in AI demands C-level vision,” said Abhishek Singh, vice president of Information Technology Services at Everest Group. “AI presents unique opportunities for healthcare enterprises – allowing them to improve customer experience, achieve operational efficiency, enhance employee productivity, cut costs, accelerate speed-to-market, and develop more personalized products. In the case of the leading healthcare organizations, their CEOs and CIOs are acknowledging the transformative power of AI, rapidly building appropriate AI strategies, and building a robust, overarching business plan to harness its benefits.”
Additional key findings:
Indian IT services major Wipro may have to look at building solutions beyond healthcare enrolment-based services for its Health Plan Services unit to remain competitive amid legislative changes in the US, say analysts.
The Donald Trump-led US administration has pushed consistently to repeal Obamacare, which extended health insurance benefits to a large chunk of low-income people in the US.
At this juncture, Wipro should look “to double down quickly (to) address the re-pivot issues,” Peter Bendor-Samuel, chief executive of global IT advisory firm Everest Group, told ET.
Research Vice President Abhishek Singh will be a speaker at Becker’s Hospital Review Health IT + Clinical Leadership held on September 19-22 in Chicago. Abhishek will speak on the growing importance of blockchain technology on September 22 during Track F of the Blockchain Summit portion of the event.
Event Description
Join the brightest minds in Health IT and the Revenue Cycle – great networking – learn more in 48 hours than you can all year! This exclusive conference brings together hospital and health system CIO and IT executives to discuss the Role of the CIO, Social Media, Data Analytics, Blockchain, Mobile Health, EMR Issues and Health IT Issues.
Come listen and network with Hospital Executives as speakers discuss their biggest concerns and how they are addressing them.
When
September 19-22, 2018
Where
Hyatt Regency
Chicago
Speaker
Abhishek Singh, Research Vice President, Everest Group
Everest Group offers solutions to help healthcare providers combat margin-crushing regulations, expenses, and risks in turbulent marketplace
A majority of healthcare providers in the United States suffered financial decline in 2017 amid the industry shift toward a value-based care system. Although many healthcare providers espouse a sound and logical strategy that focuses on people, process, and technology, few have been singing that song correctly, according to Everest Group.
In Everest Group’s recently published report, “Healthcare Provider Market: Addressing Issues Beyond Value-Based Care | What Healthcare Providers Need to Do to Address Myriad of Challenges,” the firm presents the challenges faced by healthcare providers in the market today and explains how most healthcare providers’ efforts to overcome those challenges have fallen short.
The key challenges facing healthcare providers include the following:
To engineer a turnaround in this bleak trend, U.S. healthcare providers still need to focus their investments on people management, process improvement and technology enhancement—but in smarter ways than ever before, according to Everest Group. In particular, healthcare providers need to be more targeted in their digital transformation investments and bolder in their ecosystem development endeavors, relying heavily on partnerships to effect greater change.
“One very real and pressing concern of many providers is the large investment they have already made in large-scale EHR implementations and the limited resources remaining for new investments,” said Manu Aggarwal, practice director at Everest Group. “To identify the path forward, providers need to outline a targeted set of investments instead of another round of large ones. Specifically, investments in automation and analytics can yield solid, quick wins and pave the way for future engagements without the need for high capital outlay.”
“Another ‘must’ for providers is ushering in a much more collaborative culture,” added Aggarwal. “For example, providers need real-time data sharing with payers in order to provide enhanced patient experience. Providers also need strong partnerships with technology vendors and business process service providers to deliver the modern, technology-driven services that patients demand. And, finally, broader collaboration among the health network is required for improving patient outcomes and maximizing reimbursements.”
Additional examples of the solutions recommended by Everest Group in the report include the following:
ITO and BPO to grow steadily as healthcare payers play catch-up on digital solutions to navigate industry convergence and a shift in focus from B2B to B2C
Healthcare is lagging behind other industries in adopting digital strategies, but radical changes in the marketplace—such as the advent of Walmart and Amazon as players in the space and the disintermediation of Pharmacy Benefit Managers (PBMs) like Express Scripts and CVS—are cultivating a fertile field for digital solutions.
Everest Group describes the current healthcare market as a shape-shifting industry, with once disparate players in the market—payers, providers, PBMs and pharmaceutical companies—converging, and the focus of healthcare payers shifting from business-to-business (B2B) to business-to-consumer (B2C). To successfully navigate these industry shifts, healthcare payers must adopt radically different, technology-based approaches to the way they serve members, reimburse providers, operate their internal systems, and adapt to changes in government regulations and programs, according to Everest Group.
“Take the typical healthcare payer’s internal IT systems and processes, as just one example,” said Abhishek Singh, practice director at Everest Group. “They are plagued with disparate information systems, fragmented member information, legacy IT burdens, insufficient transparency in financial records, and inflexible, manual processes. The need of the hour in this regard is systems integration, data standardization and homogenized processes. For this reason, we expect the healthcare payer IT-BPS market to grow 8 percent by 2020.”
In its recently published report, Healthcare Payer Annual Report: Payers Look at Digital to Reinvent in a Turbulent Healthcare Market, Everest Group examines in detail the myriad changes impacting the healthcare and life sciences market and describes specific steps healthcare payers need to take in four key areas to be future ready.
“We will see payers relying on sourcing partners to address data flow and integration; the adoption of digital levers such as mobility, cloud automation and analytics; and process standardization and reengineering,” said Singh. “These technology and operations mandates will be the key factors that determine whether payers’ are able to successfully transition to a future-ready state.”
***Download a complimentary abstract of “Healthcare Payer Annual Report: Payers Look at Digital to Reinvent in a Turbulent Healthcare Market” here.***
If I had a penny for every time Artificial Intelligence was mentioned during the recent NASSCOM India Leadership Forum, I could buy a lot of Bitcoins. Both hype and hope abound around AI and its impact on different industries’ business models.
Let’s take a look at AI the healthcare industry. Adoption is increasing, helping solve a number of problems for patients, doctors, and the industry overall. AI engines are helping doctors identify patterns in patient symptoms with data and analytics, improve diagnoses, pick the right treatments, and monitor care.
For instance, physicians can now plug diagnoses into IBM’s Watson for Oncology and receive treatment suggestions based on historical patient data and information from medical journals. Face2Gene combines facial recognition software with machine learning to identify facial dysmorphic features, helping clinicians diagnose rare genetic diseases.
Using AI to treat mental health issues is particularly fascinating. So far, AI has only been viewed as a means to help healthcare professionals provide better care. But can it eliminate a patient’s need to consult with a doctor altogether for mental health-focused moral counseling and empathetic support?
Consider this: AI engines today have the ability to listen, interpret, learn, plan, and problem solve. Early identification of mental health issues is possible through the analysis of a person’s facial features, writing patterns, tone of voice, word choice, and phrase length.
These are all decisive cues in learning what’s going on in a person’s mind, and can be used to predict or detect and monitor mental conditions such as psychosis, schizophrenia, mania, and depression.
The idea of end-to-end mental health treatment through AI with no human intervention is quite viable, and the prospect becomes even more enticing when you consider how the following factors could drive acceptance among patients:
Thus, it’s not surprising that a few players have already begun to delve into this space. Woebot is a software chatbot that delivers a mood management program based on Cognitive Behavior Therapy (CBT). AI luminary Andrew Ng is on the company’s board of directors. Randomized controlled trials at Stanford University have shown that Woebot can help reduce symptoms of depression and anxiety in two weeks.
Another example is Tess, a psychological AI that communicates via text, administers highly personalized psychotherapy, psycho-education, and delivers on-demand health-related reminders, when and where a mental health professional isn’t available. It can hold conversations with the patient through a variety of existing technology-based communications, including SMS, WhatsApp, and web browsers. More recently, Facebook started using AI to help predict when users may be suicidal.
There are even cases of highly specialized products:
While the hype crowd might have you believe that your next appointment will be with a droid, several open questions warrant healthy skepticism of mainstream AI adoption in mental healthcare:
The ecosystem is trying to solve for these and other questions. While it might be too early to say that AI-based mental health treatment options can become mainstream currency, they clearly create significant value. As healthcare organizations and patients experiment with these use cases, there’s a sizable opportunity to reimagine the workflow and treatment paradigm.
On January 30, 2018, Amazon, Berkshire Hathaway, and JPMorgan Chase & Co. announced a partnership to address healthcare for their U.S. employees. The goal is simple – provide their employees and their families with simplified, high-quality, and transparent healthcare at a reasonable cost, through technology solutions. They intend to pursue this opportunity through an independent company that is free from profit-making constraints.
While this might not be the big Amazon-disrupts-healthcare reveal the market had been hoping for, it is still a meaningful move. Employer-sponsored health insurance currently covers around 157 million people in the United States, and people are not satisfied with the present state of affairs:
Employers are moving towards programs with narrower networks. And if employees choose to visit a doctor outside the network, they have to spend more out of their own pocket.
Amidst rising costs, evolving consumer preferences, changing operating models, and an uncertain regulatory environment, stakeholders in the healthcare ecosystem are trying to create innovative partnerships and business models. For example:
The Amazon-Berkshire Hathaway-JPMC trio could well lay down a marker on how employers shape and drive their own healthcare mandates. Consider the firms’ complementary skill sets:
This alliance can potentially have a huge impact on all the healthcare stakeholders.
The mega-healthcare company will currently focus on its combined employee base of approximately 1 million employees – plus their families – in the U.S. If it’s successful, it can take the model to other employer groups to help them address inefficiencies in their current healthcare setup.
However, it’s critical to keep in mind that healthcare differs from other areas disrupted by tech. It is often messy, fragmented, and lacks interoperable/standard data. Strikingly similar initiatives have faced hurdles and shut down (…remember Dossia?) Many initiatives to reimagine healthcare from outside have failed to move the needle meaningfully.
Given the lack of clarity around specifics of this partnership, some amount of skepticism is warranted. But for now, everybody’s looking at what the future holds.
What is your take on this mega-alliance? We would love to hear from you at [email protected] and [email protected]
It should come as no surprise that global services activity in the U.K. has dropped significantly in all sectors in the aftermath of the Brexit referendum. Indeed, according to our Transaction Intelligence database of sourcing deals, in the healthcare space, the U.K.’s National Health Service (NHS) awarded 13 outsourcing deals in 2015, 11 in 2016, but only four in the first half of 2017.
However, our research indicates that the policy of patient-centric care introduced by the National Institute for Health and Care Excellence in 2012 is likely to drive ample long-term opportunities for innovative IT service providers that offer technology enablers.
For example, under the NHS’s RightCare initiative, the NHS may look to accelerate the adoption of value-based care. Funding is focused on allocative value (how well assets are distributed to different areas of healthcare), technical value (how well resources are used to achieve valid outcomes), and personalized value (determined by how well an outcome matches patient expectation). Additionally, with increasing demand for telemedicine, NHS trusts will be on the lookout for providers that develop mobile applications aimed at remote healthcare management to support the growing importance of care at home for chronic conditions.
A robust cybersecurity network is equally imperative in the wake of recent instances of data breaches such as the March 2017 WannaCry attack, in which the medical records of 26 million NHS patients were hacked. Service providers can help the NHS protect its IT infrastructure from malicious cyber attacks by offering threat intelligence solutions, threat detection and mitigation applications, Blockchain-powered Electronic Health Records (EHRs), and persona-based security platforms.
While third-party providers can profit from these long-term opportunities, they need to be cognizant of the changing competitor landscape, particularly from tech start-ups that are testing the waters to realize potential demand in the U.K. healthcare sector. For instance, DeepMind, a London-based artificial intelligence start-up, worked with the NHS in 2016 on technology to improve care coordination.
To take advantage of growing consumerism in the U.K. healthcare space – e.g., e-Referral and e-Consult services – we recommend that IT service providers increase their investments in growing technological areas such as security, mobility, analytics, and IoT. But first and foremost, they must offer services that focus on patient care. Doing so would help the NHS avoid a repeat of its failed National Programme for IT, which was aimed at cost savings and efficiency, but was abandoned after nine years at a cost of £10 billion in 2011.
We will continue to watch this space and actively share our thoughts and perspectives. In the meantime, you can stay up-to-date on our latest insights in the healthcare domain through our dedicated research on the Healthcare & Life Sciences sector.
IT services companies, which were betting on the enrollment for Obamacare to revive faster growth in healthcare services business in the US, may be disappointed as the Trump administration has cut budgets and time for enrollment of the landmark healthcare programme.
Global analysts largely say “nothing much has changed” despite efforts by the current administration to replace the healthcare legislation and this could mean no major change in business for IT services companies, both Indian and global, at least this year.
“…the shorter enrollment period, discontinuing of some subsidies, and reduced funding for advertising also illustrate that the uncertainty is far from over. Consequently, we do not expect the payer segment of the healthcare market to change a great deal with demand for IT services stable but not driving increased growth,” said Peter Bendor-Samuel, chief executive, Everest Group, a global IT research firm.
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