2024 heralds robust growth for healthcare’s generative AI adoption, predicted by Dr. Justin Norden of GSR Ventures. Despite cautiousness in tech adoption, early adopters foresee tangible benefits in administrative tasks. The sector’s keen interest in AI’s potential within a year of ChatGPT’s launch signals rapid innovation. Simultaneously, the absence of regulatory frameworks poses challenges. President Biden’s AI Executive Order foreshadows imminent federal guidelines. Navigating regulatory ambiguity requires healthcare entities to proactively oversee AI compliance. Financial strains prompt consolidation of tech vendors, emphasizing ROI. Vendors must demonstrate streamlined solutions. Amidst this landscape, a balanced approach between innovation, regulation, and consolidation will define healthcare’s GenAI journey.
Healthcare stands at a transformative juncture in 2024, poised for exponential growth in generative AI adoption while grappling with impending regulatory constraints and vendor consolidation. Dr. Justin Norden, a GSR Ventures partner, forecasts substantial strides in AI integration within healthcare. Yet, challenges loom as the sector navigates uncharted regulatory territories and financial pressures. The absence of structured guidelines and the need for vendor consolidation pose significant hurdles. This landscape demands a delicate equilibrium between technological advancement and regulatory compliance. A nuanced exploration of GenAI’s trajectory in healthcare unveils a complex interplay between growth, regulation, and vendor dynamics.
The emergence of generative AI gained immense traction a year ago, notably with the widespread popularity of OpenAI’s ChatGPT, utilizing expansive language models. Experts unanimously recognize the technology’s boundless potential across various healthcare applications, and numerous leading health systems have already commenced its integration.
Dr. Justin Norden, a partner at GSR Ventures, foresees parallels between 2024 and the preceding year in terms of generative AI advancements: more expansion, diverse applications, and increased early adopters. However, he anticipates the introduction of regulatory frameworks.
In an interview, Dr. Norden shared insights on the forthcoming year concerning the utilization of generative AI, regulatory shifts, vendor consolidation, and other pertinent aspects.
Q. You anticipate continued substantial growth in generative AI within healthcare in 2024. Can you elaborate on why you foresee this ongoing trend?
A. While 2023 witnessed fervent discussions and hype surrounding generative AI, few health systems had solidified comprehensive strategies for adopting this emerging technology. Implementation beyond isolated pilot projects, specifically tailored for targeted use cases, remained limited.
Healthcare, characterized by cautious technology adoption, typically adopts a wait-and-see approach before embracing new advancements. For instance, most health systems tend to observe their peers and industry giants before venturing into uncharted territories.
Nevertheless, the early adopters within the provider community will begin reaping tangible benefits from integrating generative AI applications. Initial returns will likely manifest in areas like ambient documentation, data solutions, revenue cycle management, and other low-risk administrative tasks.
Despite healthcare’s comparatively slower pace, the sector’s keen interest in generative AI within a year since the launch of OpenAI’s ChatGPT is remarkable. The swift pace of innovation, both within and outside healthcare, witnessed in the past year is anticipated to persist into 2024.
Health systems strategizing on optimal infrastructure and application scenarios are poised to experience and accelerate the accrued benefits as technology advances.
Q. You predict impending regulations covering various AI types and algorithms. Could you outline your expectations regarding this?
A. A hindrance to healthcare’s adoption of generative AI lies in the absence of regulatory frameworks or standardized guidelines ensuring patient safety and mitigating provider liability risks. President Biden’s October Executive Order to regulate AI signals an imminent need for federal guidelines or legislative measures in 2024.
Regulation of AI was an inevitable development due to its potency and rapid evolution. Presently, healthcare AI resembles the Wild West, featuring numerous point solutions with limited real-world testing and insufficient guardrails. This exhilarating yet precarious phase is approaching its conclusion.
Specifically, in 2024, I anticipate broader regulation encompassing the usage of AI across clinical and non-clinical healthcare functions. AI systems will necessitate testing for bias, accuracy, and safety before deployment and continuously thereafter.
Given the ongoing regulatory uncertainty, health systems must be methodical in ensuring compliance – possibly pre-empting final government rulings. Provider organizations may find themselves overseeing their AI algorithms and related vendors.
Q. Additionally, you suggest that healthcare systems will consolidate technology vendors due to financial constraints. What might this consolidation look like?
A. Healthcare IT budgets have notably expanded in recent years, particularly due to EHR system replacements and the integration of telehealth and remote patient monitoring during the pandemic. These new systems not only demanded more vendors and increased costs but also necessitated hiring high-paid IT personnel and consultants to manage and streamline technology and workflows.
This exponential growth in IT budgets is unsustainable.
The financial strain experienced by hospitals since 2020 will persist in 2024, compelling organizations to consolidate health IT vendors. This process will commence with systems lacking definitive returns or offering critical infrastructure. Solutions considered ‘nice-to-have’ or merely convenient will be phased out, exerting pressure on core platform vendors to deliver enhanced value.
Under these circumstances, introducing new IT solutions to hospitals will become more challenging. Vendors can differentiate themselves by showcasing tangible and referenceable returns on investment.
In the trajectory of healthcare’s generative AI in 2024, Dr. Norden’s insights forecast a landscape defined by growth, regulation, and vendor consolidation. While early adopters anticipate tangible benefits, regulatory uncertainty poses challenges. President Biden’s AI Executive Order foreshadows impending guidelines, necessitating proactive compliance measures. Financial pressures drive vendor consolidation, emphasizing demonstrable ROI. Healthcare’s GenAI journey hinges on a delicate balance between innovation, compliance, and vendor strategies. As the sector navigates uncharted territories, success lies in a harmonious integration of technology, regulatory compliance, and strategic vendor partnerships to unlock the vast potential of AI while ensuring patient safety and provider efficacy.
