CEOs and CFOs remember the challenges all too well� The Omicron surge halted nonurgent procedures in the first half of the year , government support tapered off , and labor expenses ballooned amid sta�ng shortages . There was also the record-high in�ation that continues to intensify margin pressures today . According to a recent Bain survey of health system executives , �0� cite rising costs as their greatest concern .

Payers and providers are now on the hunt for margin improvements . In our experience , the most successful companies won�t merely reduce costs , but also ramp up productivity . When done right , modest technology investments can accomplish both .

Artificial intelligence ( AI ) may hold part of the answer . With the costs to train a system down 1,000-fold since 2017 , AI provides an arsenal of new productivity-enhancing tools at a low investment .

Many executives recognize the growing opportunity , especially with the recent rise of generative AI , which uses sophisticated large language models ( LLMs ) to create original text , images , and other content . It�s inspiring an explosion of ideas around use cases , from reviewing medical records for accuracy to making diagnoses and treatment recommendations .

Our survey reveals that ��� of health system executives believe generative AI has reached a turning point in its ability to reshape the industry . However , only �� have an established generative AI strategy . It�s time to play offense�or be forced to play defense later . But choosing from the laundry list of generative AI applications is daunting . Companies are at high risk of overinvesting in the wrong opportunities and underinvesting in the right ones , undermining future profitability , growth , and value creation . A waitand-see approach is a tempting prospect .

However , we believe the next generation of leading healthcare companies will start today , with highly focused , low-risk use cases that boost productivity and cost e�ciency . Over the next three to nine months , these companies will improve margins and learn how to implement a generative AI strategy , building up the funds and experience needed to invest in a more transformative vision .

Endless potential — and high hurdles The excitement around generative AI may feel akin to the hype around other recent digital and technology developments that never quite rose to their promised potential . Well-intentioned , well-informed individuals are debating how much change will truly materialize in the next few years . While developments over the past six months have been a testament to the breakneck speed of change , nobody can accurately predict what the next six months , year , or decade will look like . Will new players emerge� Will we rely on different LLMs for different use cases , or will one dominate the landscape�

It ’ s time to play offense — or be forced to play defense later .

Figure 1

SOURCE : BAIN HEALTH YSTEMS SURVEY

GlobalHealthAsiaPacific . com ISSUE 5 | 2023

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