Ohio-based AI workforce startup Olive snapped up fellow AI provider Verata Health to help it streamline the prior authorization process in healthcare. This news arrives on the heels of Olive’s $225 million funding round that vaulted it to unicorn status at an overall valuation of $1.5 billion.
Olive’s tech could help abate the physician burnout crisis that’s been exacerbated amid the pandemic. Physicians often spend hours going back-and-forth between a patient’s health insurance company to approve a procedure, and that contributed to the US’ physician burnout crisis: 89% of providers reported that the burden of obtaining a prior authorization was “high” or “extremely high,” per an analysis published this month by the American Hospital Association (AHA).
And while some major payers like Cigna recently waived some prior authorizations to ease doctors’ burdens amid the pandemic, this hasn’t been sweeping—and short-staffed hospitals haven’t been able to keep up with admin tasks amid influxes of patients. To this end, tech like Olive’s can help minimize the number of hoops that healthcare workers have to jump through to get patients approved for need-to-have procedures—while enabling burnt-out providers to spend more time with their patients.
Healthcare execs are bullish on implementing AI in their organizations next year—and it’s likely that AI for admin will emerge as a top investment area due to its high ROI. For one, admin processes like prior authorization approvals are expensive: One 17-bed hospital reported spending upward of $11 million annually on complying with complex prior authorization requirements alone, according to the AHA.
That means admin tasks are the cause of major revenue leaks for health systems—and AI tools should be a long-term solution to ease this financial burden. Companies that help automate admin processes—like Optum, Olive, and R1 RCM—will likely retain the attention of hospitals looking to up their spending on AI in 2021: Despite evolving financial priorities due to the pandemic, 90% of health IT execs anticipate widespread implementation of AI over the next five years, per a November report by Black Book Research.