A study of the impact of AI for healthcare has found that the technology is likely to bring significant disruption to the industry – taking the value created out of the pockets of traditional healthcare companies and into the hand of the technology industry.
The research by Boston Consulting Group, which is published today in a report entitled Chasing Value as AI Transforms Health Care, found two scenarios for how the value created by AI for healthcare would be disseminated – both of which see traditional healthcare companies fail to gain most of the benefits.
In the first, traditional healthcare companies retained the value created by efficiency improvements, however the value created by improvements and growing adoption of AI for healthcare was for the most part claimed by companies in the medical technology space. In this scenario the pharma industry would remain unaffected.
In the second scenario, however, the value created by AI is largely passed onto consumers. This is because in this version, AI drives improved outcomes at lower costs, producing what is known as value-based healthcare.
“Artificial Intelligence will drive major advances in realising the vision of value-based healthcare,” explained study co-author Ryan Gallagher, project leader at Boston Consulting Group.
“It has the potential to detect connections and correlations between medical treatment and patient outcomes in a way that hasn’t been possible before. That will not only save lives but also potentially help control rapidly rising health care costs.”
In this scenario medical and conventional technology companies would see significant benefits, but the pharma industry would see a drop in profits as diseases would be prevented or caught early more often.
Companies urged to prepare for disruption caused by AI for healthcare
Given the level of disruption artificial intelligence poses to the industry, healthcare companies are being advised by Boston Consulting Group to expand into the technology space now or risk being sidelined in favour of tech giants.
“Artificial intelligence is to some degree already being deployed across all incumbent sectors of healthcare today and will play an exponentially larger role in the years ahead,” said study co-author Alexander Aboshiha, partner at Boston Consulting Group.
“Companies need to move quickly to harness this rapidly developing technology – including by ensuring they have access to the right data and the right talent to succeed.”