Tag: phti

PHTI Says AI Is Automating the Wrong Things

Posted on by Jason Barry

The Peterson Health Technology Institute just published a roadmap for scaling high-value AI in healthcare, and the good news is that AI is currently doing exactly what it’s supposed to. Unfortunately, that’s also the bad news. 

Follow the incentives. PHTI sets the stage by explaining why existing fee-for-service models have led to AI solutions that fuel a broken system rather than improving it. Tough to argue with.

  • When health systems implement AI that optimizes coding for revenue, you’re going to see more Level 5 encounters. Not malicious, just tech doing its job. 
  • Payers are doing the same thing with prior authorization. AI squeezes every drop out of the rules that it’s given, which equates to more denials and lower cost per claim. 

PHTI says this is exactly what we asked for. When you incentivize volume and complexity, AI heads straight for it: prior auth, coding, claims, and appeals.

  • Focus follows revenue, and we’re currently on a direct course for a whole lot more of a rough status quo if incentives stay the same.

What’s the fix? Refocus reimbursement on outcomes over activity.

PHTI’s roadmap has four pillars to make that happen:

  • Understand what works – Define outcomes, compare AI solutions, and continuously monitor what actually improves outcomes. Results matter more than process, and they’re the quickest way to build trust.
  • Set rules for coverage and use – Clarify licensure, liability, oversight, and coverage for AI-enabled care. Get payers aligned so that proven tech has a defined path to payment.
  • Purchase effectively – Pay for outcomes rather than activity, with real-world performance reflected in vendor pricing power. If vendors are evaluated against transparent outcome measures, then those are exactly what’s likely to improve.
  • Redesign care delivery – Remove wasteful administrative processes instead of layering agents on top. PHTI envisions admin processes streamlining as a result of better care delivery, rather than setting its boundaries.

Incentivize outcomes. Not exactly a novel idea, but PHTI paints a scary picture of the AI-powered future where it doesn’t happen. AI is a multiplier, and now’s the time to make sure it’s multiplying the right variables.

The Takeaway

PHTI was right on cue with the AI horror stories, and it outlined exactly where the script needs to change if we want a happy ending.

PHTI: AI Reality Opposite of Expectations

Posted on by Jason Barry

AI promised less friction and lower administrative costs, but a new report from the Peterson Health Technology Institute suggests that it might actually be delivering the exact opposite.

The report stems from a stakeholder workshop that PHTI held to uncover AI’s impact on two of healthcare’s most hotly debated administrative processes: prior authorization and medical coding.

The main finding highlights an obvious predicament. Speeding up flawed processes doesn’t make them any less expensive. PHTI didn’t pin the blame on either side of the AI arms race.

  • It found that payors are (mostly) using AI responsibly. They’re accelerating PA reviews and auto-approving more clean cases, while simultaneously improving code validation and risk adjustment – although the DOJ would probably disagree.
  • Providers are also using their AI superpowers for good. They’re automating the PA workflows driving burnout and streamlining the coding processes that take clinician time away from patients.

That almost sounds like it should create some efficiency. The problem is that it’s the system that’s broken, and AI doesn’t fix the underlying issues.

  • The report pointed out how AI tools for providers caused an uptick in billing intensity, which payors naturally responded to with across-the-board downcoding and other reimbursement reductions.
  • AI might also reduce the cost for individual orgs to execute or appeal prior auths, but it won’t impact costs for the overall system if nothing gets passed on to patients.
  • PHTI believes this makes reimbursement policy the strongest lever that can realistically be pulled to slash system-level spending.

Follow the incentives. Or in this case, the lack thereof. 

  • On paper, payors and providers should be competing for a finite pool of patients in an arena that rewards better products with smaller price tags. If AI cuts costs, providers would be able to bill less and payors could lower premiums.

Efficiency doesn’t translate to deflation. Payors or providers are rational market actors, and if AI can streamline a process that lets them hold onto more of their revenue, then that’s exactly what they’ll do.

The Takeaway

Bots arguing with bots might be faster than humans arguing with humans, but PHTI doesn’t see that eliminating friction from the overall system if nobody has any incentivize to make it happen. 

PHTI Breaks Down Barriers to Clinical AI

Posted on by Jason Barry

PHTI’s new Clinical AI report delivered exactly what we’ve come to expect from their research: top tier industry analysis through the lens of actual stakeholders.

They assembled the A Team for this one. The report was built from an in-person workshop that PHTI convened with senior industry leaders – from health systems and health plans to tech firms and federal agencies – to explore what’s needed to safely scale clinical AI.

  • The workshop underscored the policy, reimbursement, and evidence gaps holding back adoption, with several key themes emerging from the discussion around their example use cases (hypertension management and mental health chatbots).

Theme 1: Evidence standards should compare AI to current standards of care and scale with risk.

  • That means comparing AI to the care that patients actually receive today rather than idealized care, then having different standards that align with the clinical risk of using the tool.
  • Highlight: Evidence should assess whether the full workflow (including multiple models, devices, and human oversight) improves outcomes, not merely model performance.

Theme 2: Performance benchmarks should be based on clinical outcomes, and safety standards should adapt as the evidence grows.

  • Ambiguity around what constitutes “good” performance is a persistent barrier. Metrics need to be anchored to specific clinical outcomes instead of vague process measures.
  • Highlight: Across both use cases, participants emphasized the need not only to set benchmarks but to set minimum safety floors, which could adjust dynamically over time on the basis of observed outcomes, changing patient risk profiles, & emerging evidence.

Theme 3: New technologies may be initially tested in lower-risk populations, but should scale quickly to high-risk populations to maximize impact.

  • Low-risk patients are tempting on-ramps, but AI’s greatest benefits come from reaching the high-need patients, and reaching them carries higher evidence expectations and more clinical risk.
  • Highlight: For mental health, engagement and retention are huge barriers to treatment. Participants cautioned that overly restrictive AI deployments risk limiting access and instead emphasized the need for appropriate care routing following LLM engagement.

The Takeaway

Even the most effective clinical AI tools still have plenty of questions to address before adoption can scale, and PHTI just crowdsourced some promising answers straight from the boots-on-the-ground in the healthcare trenches.

2025 State of Digital Health Purchasing

Posted on by Jason Barry

What better way to kick off HLTH week than with a new survey from the Peterson Health Technology Institute showing that healthcare decision-makers are still hungry for new solutions?

PHTI’s 2025 State of Digital Health Purchasing Survey showed that health plans, employers, and health systems are all investing heavily in digital health, but spending patterns are starting to diverge.

  • The headlining stat: 61% of health plans and 44% of health systems plan on increasing digital health spending in the coming year, compared to just 14% of employers.

Employer spending has leveled off. Two-thirds of employers plan to hold spending steady as they maintain their current suite of solutions.

  • In contrast, health plans and health systems are ramping up to offer a wider variety of solutions (81%) and keep up with patient engagement (77%).
  • The top priorities across the board? Improve access, reduce costs, and strengthen user experiences, especially in areas like diabetes, mental health, and primary care.

Purchasers are more hawk-eyed than ever… especially when it comes to their contracts. Nearly half of purchasers are already using performance-based contracts, and the majority plan to use them in the next year.

  • 73% of contracts now have a duration under two years – up from 59% last year – leaving a short window for solutions to prove their value.
  • Short-term contracts, annual portfolio reviews, and a laser focus on engagement and ROI are the new normal. Building long-term relationships hinges on demonstrating both.

Vetting isn’t getting any easier. When comparing vendors, employers (66%) are more likely than health plans (23%) and health systems (42%) to cite cost as the deciding factor.

  • Payors and providers both prioritize a proven track record above cost, but the report points to other ways to gain an edge.
  • Although performance-based contracts are gaining traction, few purchasers are satisfied with their current models, and they’re looking for vendors that can offer either better outcome thresholds or attribution methods.

The Takeaway

Health plans, employers, and health systems all still have an appetite for new solutions, and PHTI just gave vendors a way to stack their decks with more data on each of their unique priorities.

PHTI Gives High Marks to Virtual Mental Health Solutions

Posted on by Jason Barry

Virtual mental health solutions were the latest segment to fall under the piercing gaze of the Peterson Health Technology Institute, and in typical PHTI fashion the reviews were mixed.

The evaluation incorporated over 5,000 articles, input from clinical advisors, and interviews with depressed or anxious patients to evaluate three kinds of mental health solutions on their clinical effectiveness and economic impact:

  • Self-guided solutions – content that people can work through on their own, typically offered directly to employers or health plans (AbleTo, Dario, Headspace, Learn to Live, Meru Health, SilverCloud, Talkspace, Teladoc)
  • Prescription digital therapeutics – FDA-cleared interventions often used in conjunction with clinician-supervised outpatient treatment (DaylightRx, Rejoyn)
  • Blended-care solutions – build on self-guided treatment with integrated virtual care teams of therapists and psychiatrists (AbleTo, Brightside, Headspace, Koa Health, Lyra, Meru Health, Modern Health, Spring Health, Talkspace, Teladoc)

The good news? All 15 of the solutions produced meaningful improvements in symptoms of anxiety and depression, especially for patients not already in therapy.

The catch? While these solutions have the potential to improve access and outcomes, their net impact on overall spending varies by payor and category.

  • Self-guided solutions demonstrate clinically meaningful improvements in both anxiety and depression (6.9-point reduction in PHQ-9), with a relatively low cost (~$2 PMPM) that’s estimated to reduce spending in commercial settings by $0.30 PMPM.
  • Prescription digital therapeutics deliver equally strong symptom improvement, and because they’re expected to be reimbursed on a per user basis (~$280 per episode) rather than across all plan members, they save an estimated $0.72 PMPM.
  • Blended-care platforms show the strongest clinical outcomes, but with pricing models (~$6 PMPM plus $792 in annual therapy costs per user) that tend to increase overall health spending by an estimated $2.10 PMPM.

The Takeaway

PHTI gave virtual mental health solutions a glowing report card, and it seems like even the lone negative review – blended-care platforms – have their place for patients with severe symptoms.

Peterson Center on Healthcare Takes Aim at Remote Patient Monitoring

Posted on by Jason Barry

The Peterson Center on Healthcare is back with another report that doesn’t mince words when it comes to remote patient monitoring: “RPM reimbursement in Medicare is misaligned with the clinical value of these tools.”

The report synthesized Peterson’s past evaluations of diabetes, hypertension, and musculoskeletal solutions, which encompassed the trio of conditions associated with the highest spending and utilization for remote monitoring services.

Although only ~1% of Medicare patients are in RPM programs, utilization has grown exponentially since the start of the pandemic.

  • There’s been a tenfold increase in Medicare patients using RPM services from 2019 to 2023 (44k to over 451k patients). 
  • Medicare expenditures for RPM skyrocketed from $6.8M to $194.5M over the same time period.

There’s also been a steady rise in long-term monitoring, even though research suggests most of RPM’s benefits accrue within the first few months.

  • The average RPM episode duration was just 1.7 months in 2019, jumping to 5.2 months by 2023. Over 22% of RPM episodes now last over nine months.
  • There’s currently no limit on how long providers can use RPM for a specific patient, meaning they can be reimbursed “on a monthly basis in perpetuity for anyone with a diagnosed chronic condition, even if they are already well-managed.”

PCH offered three recommendations to policymakers to combat these issues:

  • Base coverage and reimbursement on proven clinical value for different conditions. 
  • End indefinite billing practices for “forever codes” that encourage waste. 
  • Improve data collection to enable evidence-based decision making about the value and use of remote monitoring. 

The Takeaway

As providers adopt new technologies that extend care beyond the walls of the hospital, aligning incentives with high-value care sounds like an obvious approach to reimbursement, but PCH’s report makes it clear that current policies need an overhaul if they’re going to maximize the effectiveness of RPM programs.

PHTI Delivers Mixed Reviews on Ambient Scribes

Posted on by Jason Barry

The Peterson Health Technology Institute’s latest technology review is here, and it had a decidedly mixed report card for the ambient AI scribes sweeping across the industry. 

PHTI’s total count of ambient scribe vendors stands at over 60, but the bulk of its report focuses on the early experiences and lessons learned from the top 10 scribes across leading health systems.

According to PHTI’s conversations with health system execs, the primary driver of ambient scribe adoption has been addressing clinician burnout – and AI’s promise is clear on that front.

  • Mass General Brigham reported a 40% reduction in burnout during a six-week pilot.
  • MultiCare reported a 63% reduction in burnout and a 64% improvement in work-life balance.
  • Another study from the Permanente Medical Group found that 81% of patients felt their physician spent less time looking at their computer when using an ambient scribe.

Despite these drastic improvements, PHTI concludes that the financial returns and efficiency of ambient scribes remain unclear.

  • On one hand, enhanced documentation quality “could lead to higher reimbursements, potentially offsetting expenses.”
  • On the other hand, the cumulative costs “may be greater than any savings achieved through improved efficiency, reduced administrative burden, or reduced clinician attrition.”

It’s a bold conclusion considering the cost of losing a single provider, let alone the downstream effects of having a burned out workforce. 

PHTI’s advice to health systems? Define the outcomes you’re looking for and then measure ambient AI’s performance and financial impacts against those goals. Bit of a no-brainer, but sound advice nonetheless. 

The Takeaway

Ambient scribes are seeing the fastest adoption of any recent healthcare technology that wasn’t accompanied by a regulatory mandate, and that’s mostly because of magic that’s hard to capture in a spreadsheet. That said, health systems will eventually need to justify these solutions beyond their impact on the clinical experience, and PHTI’s report brings a solid framework and standardized methodologies for bridging that gap.

PHTI Delivers Mixed Review on Digital Hypertension Tools

Posted on by Jason Barry

Digital hypertension management solutions received a mixed report card from the Peterson Health Technology Institute’s latest evaluation, which found significant differences in performance depending on the treatment approach.

The 71-page report assessed clinical and economic evidence across three solution types:

  • Blood Pressure Monitoring – extend hypertension care beyond in-person visits using home monitoring devices that stream data back to providers. Ex. AMC Health, Health Recovery Solutions, VitalSight (Omron)
  • Medication Management – employ dedicated virtual care teams to coordinate medication adjustments as a supplement to the patients’ main primary care team. Ex. Cadence, Ochsner Digital Medicine, Story Health
  • Behavior Change – deliver educational content, alerts, reminders, and virtual interactions with coaches or care teams to improve hypertension self-management. Ex. Dario, Hello Heart, Lark, Omada, Teladoc (Livongo).

PHTI’s signature chart delivers a great summary of the findings:

The analysis found that all approaches across all payor types increase total healthcare spending over a three-year time horizon, because the cost of the solutions exceeds the savings from improved clinical outcomes.

The good news – at least for Medication Management and Behavior Change solutions – was that improvements in blood pressure over a 10-year window reduced patients’ risk of cardiovascular disease and prevented enough deaths to justify the cost.

  • PHTI found that only Medication Management solutions demonstrated significant blood pressure reductions compared to usual care, and recommended that this is the “most pressing area of integration” for most practice settings.
  • BP Monitoring showed “slightly greater, but not clinically meaningful declines,” but failed to breakeven at current RPM reimbursement levels.
  • Behavior Change approaches produced only “limited incremental declines,” which doesn’t support broad adoption for most patients but could still play a role for underserved populations with difficult access to usual care. 

Those findings naturally led to pushback from some of the companies named in the report. 

  • Omada said that the analysis “inadequately groups companies with very different offerings” and “narrowly focuses on select clinical metrics,” while underweighting user experience and patient-reported outcomes. 
  • PHTI responded to the critics by saying that “patients expect that clinically-focused digital solutions are improving their health. We can talk about competing on user experience… but we need to prove that they work.”

The Takeaway

There’s a high bar for digital solutions that need to justify their cost above standard care, and PHTI just raised that bar even higher for hypertension management. Not all approaches are created equal, and while some companies might not agree with PHTI’s findings, reports like these are a maturity milestone for digital health as a whole.

IT Leaders Are Ready For New Solutions

Posted on by Jason Barry

The future’s looking bright for digital health after the Peterson Health Technology Institute’s 2024 State of Digital Health Purchasing Survey found that decision-makers across the industry are ramping up their tech investments.

  • The headlining stat: 97% of employers, 86% of health systems, and 84% of health plans intend to maintain or increase digital health spending in the coming year.

Three quarters of purchasers have already grown their budget for new solutions, motivated primarily by consumer demand (83%) and improved outcomes (62%).

  • Cost advantages were cited as a top investment driver for 60% of health plans and 49% of health systems, versus just 34% of employers.
  • Across all three groups, 43% have acquired enough solutions to address 6+ conditions, and it was interesting to see how their clinical priorities varied.

Purchasers are more hawk-eyed than ever when it comes to their contracts and vetting processes.

  • 59% of contracts have a duration under two years, leaving a short window for solutions to demonstrate clinical improvements and illustrate their value.
  • When comparing vendors, a proven track record was usually the deciding factor, beating out both ROI and ease-of-use for every group.

Looking ahead to next year, value-based care is top of mind, with 100% of employers expressing interest in risk-based contracts for new solutions, as well as 60% of health plans and 50% of health systems. Other top goals include:

  • 72% of health plans are looking to reduce costs and improve member experience
  • 74% of employers are looking to improve productivity
  • 80% of health systems are looking to improve patient experience

The Takeaway

Health plans, employers, and health systems all seem to be embracing the transformative magic of digital health, and this report gave vendors a way stack their decks with data on the unique priorities of each group.

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