Artificial intelligence (AI) is a term that has grabbed headlines and piqued the imagination of many as a key to the future of business. Generative AI has democratized AI consumption for enterprises in ways that previous AI applications or content applications could not. Much of the source code is open source, allowing everyone with technical understanding access. With Large Language Models (LLMs) such as ChatGPT bringing the functionality of AI to the masses, this industry is poised to change many industries in the way they are used and their execution.
Healthcare is an area of great potential for this advancement and has the potential to demonstrate its worth across many facets of the industry. The healthcare industry accounts for 11% of global GDP, or $9 trillion annually. From the development of drugs and vaccines to improving medical diagnosis and treatment, such technologies are being used in all stages of the value chain, boosting efficiencies across the overall healthcare system. The ability to introduce greater productivity and responsiveness in a sector that has struggled to be friendly to those who use the services can only be seen as a positive. On the more optimistic end of the spectrum, the hope is that it will help identify conditions and illnesses before they show up on traditional tests or are diagnosed by humans. It is a sector burdened by financial squeezes, paperwork, and regulations but also has the ability to improve the outcomes of life-or-death situations and decisions.
Source: Pitchbook Geography: Global As of March 31, 2023
The above chart from 2019 to the first quarter of 2023 from Pitchbook is a summary of deal values in AI and Machine Learning (ML) by industries in financial services, healthcare, IT, consumer AI, industrial AI, and transportation. Through the last four-plus years, healthcare has led these groups, topping out at $21 billion in 2021. While deal values are currently suppressed through Q1 of 2023, healthcare is still leading the way. As concerns over a recession wane in the second half of the year, it is expected that deal values will increase.
From a financial perspective, wider adoption of AI could lead to savings of 5% to 10% in US healthcare spending, or roughly $200 billion to $360 billion annually within the next five years, according to the Bureau of Economic Research. AI may also deliver non-financial benefits “such as improved healthcare quality, increased access, a better patient experience, and greater clinician satisfaction.”
Overall, the future of healthcare looks poised for a comprehensive change throughout the industry with the implementation of AI technology.
How Centri Can Help
At Centri, our experts offer a variety of solutions to ensure your business’s success. With integrating new technologies, competing against others in your space, and driving more revenue, the process of growing your healthcare company comes along with a lot of questions. Whether you’re having difficulty keeping pace with internal control reporting requirements or need guidance on leveraging your recent growth in a sustainable way — Centri can support you. Contact us to learn more.
Partner | Valuation Practice Leader
About Centri Business Consulting, LLC
Centri Business Consulting provides the highest quality advisory consulting services to its clients by being reliable and responsive to their needs. Centri provides companies with the expertise they need to meet their reporting demands. Centri specializes in financial reporting, internal controls, technical accounting research, valuation, mergers & acquisitions, and CFO and HR advisory services for companies of various sizes and industries. From complex technical accounting transactions to monthly financial reporting, our professionals can offer any organization the specialized expertise and multilayered skillsets to ensure the project is completed timely and accurately.
For more information, please visit www.CentriConsulting.com
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