Hospitals' use of artificial intelligence tools during insurance claim submissions led to an additional $942 million in healthcare spending over a two-year period, according to an analysis by the Blue Cross Blue Shield Association (BCBSA).
NewsBlue Cross Blue Shield Association
AI-driven medical coding increases healthcare spending, analysis finds
The BCBSA analysis found a sharp increase in patients being documented as having complex conditions. However, the association argued there is a clear disconnect between medical coding—the process of assigning codes to diagnoses and procedures for billing—and actual treatment, noting no evidence of a corresponding change in the care delivered.
The New York Times cited the analysis as a sign that AI use on both sides of the healthcare industry—hospitals and insurers—appears to be contributing to rising costs.
Dr. Shiv Rao, founder of the AI startup Abridge, noted that while AI use could lead to a scenario of "bots fighting bots," it also has the potential to reduce tensions and cut costs.
Luke Chalker, senior vice president at BCBSA, characterized the current situation as a "one-sided blood bath" for insurers, rather than a balanced battle.
Sources
- Insurers claim AI is already increasing healthcare costs （TechCrunch AI, 2026-09-26）