AI and the healthcare revenue cycle 

In September, in preparation for the 2025 Fall Revenue Circle, I told you that prior authorization is having a moment. I cited several new developments that suggest that the animus between providers and payors over PA has seeped out of the healthcare industry and into the national debate over access to care. 

Well, I’m sure healthcare revenue cycle leaders have noticed that two other things are having a moment, albeit together: artificial intelligence and the revenue cycle. AI and revenue cycle have found each other, with their resulting integration promising to affect revenue cycle performance in profound ways. 

We’ll be talking about AI and the healthcare revenue cycle at the upcoming 2026 Spring Revenue Circle. The invitation-only event for Kodiak Platform users will be held Feb. 1-3 at the Rancho Bernardo Inn in San Diego. We've also launched our first annual Cost to Collect survey to develop a new revenue cycle KPI for benchmarking purposes. Will AI bring that cost down? Please take our survey. Here are three recent things that caught my eye regarding AI and revenue cycle. They tell me that we’re moving from the “if” and “why” phases of their relationship to the “when” and “how” phases. 

In August, a market research firm called Towards Healthcare said the global market for AI in healthcare revenue cycle management will grow more than 24% a year and reach about $180 billion by 2024. That’s up from about $26 billion this year.  

A sevenfold increase in less than 10 years says a lot about how strong this marriage will be. 

“The growth of the market is driven by the growing need for automation to optimize and reduce risks,” the firm said in its press release.  

Among the various tasks and functions dispersed along the three segments of the revenue cycle—front end, middle, and back end—the front-end task of eligibility and benefits verification will grow the fastest in terms of using AI technology to optimize workflows, the company said.  

More evidence of the attraction between AI and revenue cycle comes from this report released by the market research firm Sage Growth Partners. The report, “The Healthcare C-Suite’s Take on AI,” also released in August, is based on a survey of 101 senior-level hospital and health system executives. 

Here are some of the revenue cycle-related survey results: 

• 75% of executives said AI can reduce operational costs by improving efficiencies. 
• 77% said AI is helping improve revenue cycle operations. 
• 66% said their organizations are currently investing in AI to streamline administrative operations. 
• Revenue cycle solutions were among the top five technology initiatives over the next two years for more than half of the respondents. 

Given all the other technology initiatives and priorities at hospitals and health systems, revenue cycle is making a statement by cracking the top five. 

A month later, the U.S. Department of Health and Human Services’ Assistant Secretary for Technology Policy/Office of the National Coordinator for Health Information Technology issued a report on hospitals’ use of predictive AI. The report is based on two surveys conducted by the American Hospital Association, one in 2023 and the other in 2024. More than 2,500 hospitals responded to the 2023 survey. More than 2,200 responded to the 2024 survey. 

Overall, 71% of the hospitals said they were using predictive AI in 2024. That’s up from 66% in 2023. The most common use case for predictive AI was “predicting health trajectories or risks for patients,” cited by 92% of the surveyed hospitals each year. That’s great, as we all want the optimum level of clinical care for us and our families when we’re sick or injured. But the fastest growing use cases for predictive AI were in revenue cycle: 

• The percentage of hospitals using predictive AI to simplify or automate billing processes—a middle revenue cycle function—jumped to 61% in 2024 from 36% in 2023—a 25 percentage point increase. 
• The percentage of hospitals using predictive AI to facilitate scheduling—a front-end revenue cycle function—jumped to 67% in 2024 from 51% in 2023—a 16 percentage point increase. 

Based on these three developments, the relationship between AI and revenue cycle is accelerating. It mirrors what we’re hearing and seeing from the 2,300 hospitals and 350,000 physicians that use the Kodiak Platform to manage and report their net revenue and monitor their revenue cycle performance. Is it accelerating at your hospital, health system, or medical practice? Let’s talk about the “when” and “how” when we see you at the 2026 Spring Revenue Circle. And don’t forget to take our new Cost to Collect survey!