AI tools for health generated nearly $1 billion in extra costs: report

According to a report by the Blue Cross Blue Shield Association (BCBSA), hospitals' deployment of AI-powered revenue cycle management and documentation tools added $942 million in excess costs for member plans over a two-year window.

As reported by Reuters, AI tools are raising health spending for insurers by nearly $1 billion over two years, as providers bill for more severe patient care, according to a Blue Cross Blue Shield Association study released Thursday.

Between 2024 and 2025, providers more frequently billed for secondary conditions, or those stemming from a separate illness from the one they were treating, driving costs up by $653 million for BCBS companies during that period. 

Overall, more intense care contributed $942 million in costs to BCBS firms over the two-year period, when compared to 2023, the study added

Insurers argue that AI tools are scanning patient charts to surface more secondary conditions pushing the share of inpatient stays classified as medically complex from 37% to 40%—without showing a corresponding increase in actual treatments or medical care.

However, health systems and industry groups defend the technology as a necessary counterweight to aggressive insurance claim denials, administrative burnout, and payment delays.