Can Medical AI Add Value to Your Practice?

There is much angst about artificial intelligence (AI) these days. For some industries, AI has effectively replaced entry level positions. More retail stores are self-checkout. Customer service is handled by bots. AI is writing software programs once done by college kids just starting their careers. Boston Consulting Group reports that retailers are increasingly using AI to outperform rivals. As a medical practitioner and business owner, one must ask, "how, if at all, can AI be used to increase its practice's value?"

BrainForge claims that AI saves practices money by analyzing images like X-rays, MRIs, and CT scan faster and, in some cases, more accurately than human physicians. Risk Hedge states that AI can automate "a billion small tasks" that bury doctors in paperwork and drain hospital budgets (e.g., billing, scheduling, claims, authorization, data entry). AI scribes can automatically listen to and draft clinical notes during a patient's visit, reducing the hours doctors and staff spend on paperwork.

AI innovations do not come without its challenges. Integrating internet-connected AI tools raises concerns about security vulnerabilities and the risk of hacking. AI systems might intrude on patient privacy. Safeguarding large amounts of sensitive data is a major industry challenge. Also, today's AI models are trained by human. If human input is biased, then AI output will be biased. AI is not yet a replacement for human clinicians; it still requires human review for accuracy.

How does AI opportunities and threats affect enterprise value?

• Practices that adopt AI tools to lessen administrative burden can expect a boost in enterprise value. These AI tools are becoming common and competitively priced. Buyers expect practices to utilize them. Firms that do not utilize these AI administrative tools can expect buyers to discount their offering price. New buyers they will need to make these AI investments to remain competitive.

• Practices that adopt AI tools to broadent their service offerings will sell at a premium price compared to their counterparts. Broadening the service offering allows the practice to tap new markets and expand their revenue streams.

• Utilizing AI tools to manage billing and claim processing reduces administrative errors and improves collections. Improving the practice's cash flow management means less cash is tied up in receivables. Better receivable turnover improves the return on invested capital and therefore increases the practice's investment value.

• Investing in AI that is subtantially outside the practice's expertise can be risky. It could cause a financial drain and hurt enterprise value. Investing too far into future AI could tie up precisous dollars. While many practitioners welcome AI for lessening administrative burdens, most are cautious about its use in clinical decision-making and diagnosis.