HealthLeaders' inaugural Chief Digital Executive Exchange (CDEX) opened Thursday with a strong discussion around financial value and responsibility.
New technologies like AI may offer the potential to transform healthcare, but they still need to be budgeted. The greatest tool in the world won’t work for a particular health system if you can’t pay for it.
The financial formula for embracing AI dominated much of the discussion during day one of HealthLeaders’ new Chief Digital Executive Exchange (CDEX), a two-day, invitation-only gathering of top digital health executives from across the country in Washington D.C.
Thursday’s events included presentations from organizations like the Mayo Clinic, the Digital Health Institute (a partnership between Houston Methodist and Rice University), MemorialCare, the Mount Sinai Health System and the American Organization for Nursing Leadership (AONL), but it was Eric Kirkendall’s report on how Advocate Health plans out its AI strategy that drew the most conversation.
Kirkendall, MD, MBI, Advocate Health’s Vice President and Chief Medical Information Officer for Academic Health, presented his five key takeaways for AI investment and development that could serve as the blueprint for future technology strategy. They are:
- Invest wisely in AI; have a strategic plan that includes AI and stick to it.
- Evaluate ROI when you can, financially and in other returns.
- Know your AI spend and measure that against what your peers are spending.
- Track spending trajectories; AI solutions are evolving quickly, and spend is increasing.
- Instead of simply buying an AI tool from a vendor, consider partnering and co-developing, or even developing the technology in-house in the right situations.
And that’s where things get interesting. Kirkendall pointed out that while health systems and hospitals have traditionally purchased upwards of 95% of their technology tools from vendors, that dynamic is changing as the AI landscape evolves and health system execs look for more specific and specialized tools.
“The equation has changed for us quite a bit,” he said, noting that health systems like Advocate Health are already bolstering their software development capabilities to work on specialized AI tools and programs.
While it’s a formula that won’t appeal to every healthcare organization, the writing is on the wall: The industry needs to get AI into hospitals, clinics and doctor’s offices to create the opportunities that the industry needs to improve efficiency, reduce clinician stress and burnout, address workforce shortages, boost clinical outcomes and drive down costs.
Kirkendall and others at CDEX noted that the value proposition for AI and other new technology-based strategies – like digital health, virtual care and remote patient monitoring – is shifting. The “evaluate ROI when you can” strategy is phrased that way for a reason. While financial value is still the critical factor, healthcare executives are finding that they need to place more emphasis on qualitative value. In some instances, healthcare organizations will need to spend some money to spur true transformation.
For instance, workforce shortages won’t go away anytime soon, if ever. The industry isn’t going to see an influx of new doctors and nurses. Healthcare leaders have to take stress and burnout seriously and invest in tools like ambient AI and agentic AI to take the pressure off of clinicians and improve their work-life balance.
Kirkendall said ambient AI is one of the five major AI categories that Advocate Health is targeting, because of the potential to not only improve clinician workflows but reduce their time on the computer and give them more time in front of patients – a key factor in boosting both patient engagement and long-term outcomes. The other categories are productivity (such as AI tools for revenue cycle operations), EHR-based tools, medical imaging tools and a hospital-room-of-the-future concept centered around computer vision.
Those opportunities are in “various stages of maturity,” he pointed out. But they hint at the widespread value that new technology can offer to healthcare if digital health leaders can get the balance right.
And that’s why CDEX is happening. Digital health leaders like CIOs are claiming a seat at the leadership table and playing a larger role in long-term strategy, and they’re working more closely with their C-Suite colleagues to evangelize for new technology and give a clear picture of its ROI. They need to know not only how technology affects the various parts of the healthcare ecosystem, but how best they can address the challenges of cost and change management that will determine if these strategies succeed.
Stay tuned to HealthLeaders for more insights from CDEX.
Eric Wicklund is the senior editor for technology at HealthLeaders.
KEY TAKEAWAYS
Healthcare leaders often face difficult choices between embracing new and potentially transformative technologies like AI and the cost of supporting them.
Whereas health systems have traditionally purchased AI tools from vendors, some are exploring partnerships or even beefing up their software development departments to design and build their own tools.
As technology plays a larger role in healthcare transformation, digital health executives need to balance cost with qualitative outcomes and take a closer look at the true ROI of new tools and programs.