How AI Can Improve Healthcare Operations Management

Healthcare operations management is the process of overseeing, supporting, and improving all nonclinical functions of a healthcare organization. This includes managing the facility, overseeing the staff, controlling the budget, working with insurers and payers, implementing technology, maintaining compliance, and enabling internal communication and coordination.

Healthcare operations involve many tasks that can be improved or streamlined with the careful involvement of artificial intelligence (AI). The global healthcare AI market was valued at more than $15.4 billion USD in 2022, and it is expected to grow at a strong pace over the next several years. Some healthcare specialties stand to benefit the most from AI in the near future—and healthcare operations management is one of them.

Improving administrative workflows and back-office efficiency is often cited as one of the most immediate ways that AI can make a difference in healthcare. It is a strain on staff resources—it takes more than half of the average nurse’s time, for example—and operations management staff already have the technology infrastructure needed to harness AI sooner rather than later.

There are many other applications for AI in healthcare, both now and in the future—but the usage of AI in clinical settings is more complex in terms of technology interaction and user confidence. 

This piece will focus on seven practical ways that AI can improve healthcare operations management:

  1. Schedule providers and equipment effectively
  2. Dispatch mobile workers efficiently
  3. Streamline internal communication
  4. Improve patient communication
  5. Reduce manual administrative work
  6. Manage health insurance claims
  7. Recruit excellent employees

1. Schedule healthcare providers and equipment effectively

Scheduling appointments, healthcare providers, and costly equipment is a key part of operations management. Effective healthcare scheduling can be a competitive advantage that saves an organization money — and poor scheduling can do the opposite. 

Healthcare organizations have used AI-enhanced scheduling for quite some time, especially in medical specialties where scheduling is critical. Home healthcare is one such specialty where scheduling is complex, but incredibly important; the success of a home health operation depends on maximizing time spent with patients and minimizing travel time.

AI has several practical applications in healthcare scheduling: 

  • Schedule appointments using a system that accounts for the length of each type of service, the availability of staff, travel time required (if any), and other internal KPIs
  • Pair patients and providers effectively based on the patient’s preference or the provider’s location, credentials, or history with the patient
  • Minimize downtime of skilled workers, equipment, and facilities (like surgical suites) to improve utilization rate and reduce expenses
  • Enable online, self-service booking, a feature that more than 90% of healthcare consumers say they would use if their provider offered it

With software that incorporates AI, healthcare operations staff can instantly generate default schedules based on relevant historical trends. When given this data-informed “first draft,” staff can make manual adjustments and real-time tweaks as needed. With schedule creation taking up only a fraction of the time that it used to, schedulers can spend more time on more complex or time-sensitive tasks: unexpected absences, complex treatment sequences, adherence to scheduling KPIs, on-call policies, etc. 

AI can also help healthcare staff resolve bottlenecks in the scheduling process. Operations staff can direct an intelligent scheduling tool to scan the upcoming schedule and alert staff to underutilized providers, unscheduled services, and overbooked time slots. A scheduler can review the issue, confirm it is a problem, and jump right into troubleshooting—much sooner than if they had to review data to discover it themselves.

Scheduling KPIs How AI can help
Patient wait time AI tools that enable effective scheduling and account for travel time (when appropriate) reduce unnecessary wait times, both for scheduled appointments and emergencies
Utilization rate AI-assisted scheduling maximizes the safe usage of each medical provider and minimizes downtime for life-saving equipment like MRI machines and ventilators
Time to schedule Automated scheduling tools help staff book appointments more quickly using “suggested” time windows, and self-service scheduling allows patients to book appointments themselves
Adherence to treatment plan AI-enhanced scheduling software can alert staff members to appointments that remain unscheduled after a certain number of days, prompting the scheduler to reach out to the patient (reducing the chance that they abandon their treatment plan)

2. Dispatch mobile workers efficiently

Dispatch scheduling software is a common part of the healthcare tech stack for organizations that offer home healthcare, mobile phlebotomy, travel nursing, therapy, ambulatory services, or residential care. In these specialties, the quality of the dispatch scheduling software can make all the difference for healthcare operations. 

Many dispatch scheduling tools already incorporate AI into features like route optimization and real-time messaging. Healthcare operations teams can take advantage of AI-based features in several ways: 

  • Match the patient with the right medical provider based on organizational priorities like proximity, credentials, patient preference, prior experience with the provider, etc.
  • Provide the best route between locations with AI route optimization, accounting for traffic conditions, weather events, and real-time location data
  • Communicate accurate arrival times of healthcare workers, ambulatory services, mobile phlebotomists, therapists, or other traveling providers to the consumer(s) without requiring the dispatcher or the mobile worker to make an extra phone call
  • Keep mobile workers safe on the road by minimizing calls from dispatchers, instead using an AI-enhanced app to notify workers about schedule changes, extreme weather, or traffic
  • Address real-time dispatch needs like unexpected absences or equipment malfunctions with the help of an AI system that alerts staff of the issue and suggests an immediate solution for staff to review

AI has tremendous potential to help healthcare operations staff meet and exceed dispatch KPIs—and field service KPIs more broadly. Here are some practical ways that AI can affect key metrics: 

Dispatch KPIs How AI can help
Travel time Dispatch software with AI analyzes service locations to cluster appointments together, generate a logical travel route, and assign workers to jobs accordingly to reduce fuel costs and windshield time
On-time arrivals For home healthcare in particular, AI has the capability to factor in travel time, traffic trends, and real-time location data to generate an accurate arrival time, which keeps healthcare consumers better informed about their care
Utilization rate An AI-informed dispatch process maximizes the usage rate of home healthcare workers, mobile therapists, ambulatory services, and costly equipment like MRI machines, mobile phlebotomy labs and portable X-ray machines
Patient satisfaction Dispatch software with AI built-in can match the right provider to the patient’s situation and help the provider arrive on time—two important elements of patient satisfaction

3. Streamline healthcare operations communications

Healthcare operations management involves frequent communication with vendors, staff, consumers, and internal departments. Luckily, nonclinical communication is an area where AI can make a large impact right away: AI is already helping companies enhance their marketing/PR work and increase their 24/7 reach with chatbots and intelligent virtual assistants that can answer common customer questions.

Healthcare operations staff can use AI-enabled tools to simplify and improve communication in several ways:

  • Draft recurring communications to vendors like welcome letters and account status updates for food vendors, cleaning services, maintenance companies, medtech suppliers, and other partners
  • Draft simple interdepartmental memos like recurring reminders, simple budget updates, and other straightforward communications that can help break down silos in healthcare
  • Streamline billing and accounting tasks by double-checking the accuracy of calculations and extracting key figures from invoices and budget reports to speed up staff activities
  • Generate charts and reports on tracked KPIs like costs over time, staff utilization, efficiency, and patient satisfaction
  • Simplify requests for proposals (RFPs) by summarizing key data points for relevant staff members to review 
  • Assist with marketing and PR by creating first drafts, editing staff-created content, helping brainstorm concepts, generating call scripts for outbound marketing, and analyzing customer feedback
  • Augment staff training by providing a real-time feedback loop for written communication and creating unique scenarios that test and refine communication skills

Using AI, healthcare organizations can make communication more personalized and meaningful. For example, healthcare operations staff can craft template messages for different situations with the help of AI. When the situation arises, the AI-enhanced communication system can automatically distribute the right message to the affected individuals’ preferred contact method—whether it is a change in their schedule, a reminder of an important deadline, or an emergency situation they need to know about ASAP. 

Communication KPIs How AI can help
Staff compliance rate HR management software that incorporates AI can send automated reminders to staff to complete mandated credentialing and compliance tasks, and it can alert supervisors to take further action if the deadline is approaching
Staff productivity With AI handling straightforward tasks—like generating topic ideas for marketing and creating basic graphs for accounting—staff members can accomplish more in any given day
Invoice accuracy AI-enhanced accounting systems provide another layer of fact-checking to help reduce invoicing errors and duplicate bills
Vendor satisfaction and retention Organizations can maintain better relationships with vendors using AI-based communication tools to send reminders, ensure invoice accuracy, and provide account updates
Organic traffic, social mentions, and other marketing KPIs With AI’s help handling some of the basic functions of marketing, marketers can spend more time on creative and unique ideas to drive brand awareness and website visits


4. Improve patient communication

It’s no wonder miscommunications happen in healthcare—the average U.S. medical consumer sees more than 18 doctors throughout their life, and every participant in the healthcare system brings their own preferences, communication styles, and experiences to the table. 

Despite these challenges, clear communication matters now more than ever: patients rate both customer service (71%) and communication (63%) as more important than bedside manner when it comes to an excellent healthcare experience. 

To improve communication with patients, healthcare providers can use AI in the following ways: 

  • Update patient records in real-time so providers are better-prepared to see patients and benefit from past visit notes (including different file types, like audio files and images)
  • Send automatic appointment reminders, which are proven to result in fewer no-shows, better patient compliance, fewer unfilled appointment times, and the ability to see more patients
  • Anticipate questions and concerns based on AI analysis of historical trends, helping predict things like last-minute cancellations or common questions
  • Use chatbots and smart replies to help answer initial questions from patients and collect important context that can be used in a follow-up conversation with a staff member
  • Employ wearables and remote patient monitoring to collect health data from patients to help monitor, diagnose, and treat ongoing health conditions (especially patients who are not in close proximity to the healthcare provider)

AI has the power to change patient-provider communication in many different medical applications. Clinical trials are using conversational AI to answer participants’ questions about the trial. Home healthcare providers use automated communication tools to share real-time updates with patients about their provider’s arrival time. Hospitals and rehabilitation centers can use AI to translate discharge summaries into a patient’s native language to improve adherence to the treatment plan. When AI-assisted communication is done thoughtfully and with human oversight, it results in better-prepared patients, more informed providers, and more coordinated healthcare efforts. 

Communication KPI How AI can help
Patient satisfaction AI enables consistent reminders, proactive status updates, and clear visit summaries that increase patient satisfaction
Staff productivity With AI-generated summaries of patient status and notes updated in real-time, providers spend less time getting up to speed and more time with patients
Adherence to treatment plan Use automated appointment reminders to reduce no-shows and use generative AI to deliver treatment plans in the patient’s preferred language and format

5. Reduce manual administrative work

Administrative tasks are essential to running a health organization: ensuring healthcare operations meet government and professional requirements, managing and securing patient records, interacting with vendors, overseeing staff, and managing facilities, to name just a few. Administrative work is important—but if every element of each task is done manually, it can drain staff time and resources that would otherwise be spent on activities that drive health outcomes and revenue. 

AI can help healthcare operations teams automate some straightforward administrative tasks:

  • Automate time-consuming data entry, like transcribing visit notes by hand to update patient records or create discharge summaries
  • Simplify the management of health insurance claims, which will be discussed in the next section
  • Reduce the time spent on the phone with patients, providers, and pharmacies through the use of scripted AI assistants
  • Minimize time spent on medical coding and other billing tasks using the text- and image-recognition AI tools can offer
  • Create purchase orders based on current supply levels to reduce costly supply shortages or equipment malfunctions

It’s important to note that the manual work associated with healthcare administration is different in every health system around the world. In the U.S., administration costs make up a higher percentage of overall healthcare spending than any other high-income nation. Researchers estimated that healthcare administration made up 8.3% of all U.S. healthcare costs in 2016, and other sources estimate it is actually closer to 15-30% of total health spending

It will never be possible, or even desirable, to remove the administrative aspect of healthcare entirely. Some countries have been able to keep their administration spending much lower—like 1.6% of total healthcare costs in Japan and Sweden—but there is a base level of administration required in any system. AI can help reduce the manual and mundane tasks within administrative areas, allowing staff members to focus on the complex tasks that benefit from a human touch.

Administrative KPI How AI can help
Staff productivity Healthcare operations staff can automate basic (and time-consuming) tasks using AI, allowing them up to get more done in a day
Medical coding / billing accuracy This is applied differently based on the country and the type of care, but AI can help assign the right category to a given service and submit it to the payer after it has been reviewed by a staff member
Equipment downtime By using AI to monitor supply levels and draft a purchase order when appropriate, healthcare operations staff minimize downtime of important equipment
Employee retention Using AI to assist with straightforward and repetitive job tasks means employees can spend more time on customer service, data analysis, and aspects of the job they enjoy—which ultimately increases staff satisfaction and retention
Supply chain efficiency Medical technology and biopharmaceutical companies can use AI to study global shipping operations and get insights about how to improve efficiency at different points in the supply chain

6. Manage health insurance claims

Please note: This section is most applicable to the U.S. health insurance market, but other healthcare systems can benefit from these AI principles, too.

Health insurance and medical billing can be complicated for the average consumer, especially in the U.S. Nearly 40% of Americans report being confused by their medical bills, and half of healthcare consumers report low levels of healthcare system literacy, including insurance. 

This leads patients to call providers’ offices to ask questions, requiring staff to spend time on benefits administration and not patient care. Accenture estimates that healthcare systems spent $26 more per patient in administration costs for every patient with low healthcare system literacy. For a healthcare system that serves 100,000 patients per year, that is a hidden cost of $1,352,000 per year!

AI can help healthcare operations staff make up this gap:

  • Assist with prior authorization, which is required by U.S. insurance companies before certain services can be rendered and takes up a significant amount of time that providers could spend on patient care
  • Generate out-of-pocket cost estimates for patients based on services performed and their specific insurance coverages
  • Perform basic coverage checks using conversational AI for patients who are struggling to navigate their insurance details
  • Summarize claims issues over time, such as a pattern of denials for a certain service or provider or an overall increase in the number of claim denials
  • Identify patterns associated with fraud and abuse by analyzing large datasets and flagging worrisome trends for a staff member to review in detail

Prior authorization, in particular, is a major opportunity for improvement in the U.S. healthcare industry. Obtaining prior authorization for a medically necessary procedure takes roughly 10 business days to complete—time in which the patient’s condition can get worse. When surveyed by the American Medical Association (AMA), 94% of physicians report that prior authorization issues result in delayed care, and 80% report it leads to abandonment of treatment. AI-assisted tools are not ready to handle prior authorization as a whole, but AI can help automate a significant percentage of the manual work involved. 

Insurance KPI How AI can help
Staff productivity More than one-third of physicians have a staff member dedicated to prior authorizations; if AI-enabled tools help perform basic prior authorization tasks, clinical staff can focus on patient care and operations staff can focus their time on the most complex prior authorization cases
Claim approval rate AI can help staff process prior authorization requests quickly and accurately, increasing the chances of timely approval
Fraudulent claim rate AI can monitor and analyze millions of records at a time, making it a great tool to help staff identify fraud or abuse


7. Identify excellent candidates for open positions

AI-assisted tools have been part of the hiring process for a while now, helping recruiters write messages, schedule interviews, write job postings, screen resumés and analyze large groups of candidates. LinkedIn, one of the most popular recruiting tools, announced two AI-enhanced features for recruiters in 2023: one that helps identify candidates who are most likely to engage with a recruiter at this time, and another that uses generative AI to craft messages to prospective candidates.

Here are just a few ways recruiters can use AI to enhance and complement their work:

  • Use precise searches to find great candidates generated by an AI platform based on your parameters; for example, recruiters can use AI to generate dozens of Boolean searches to find candidates who might otherwise go unnoticed
  • Draft communications to candidates, including personalized outreach messages, status updates on the search process, messages to references, and pre-onboarding information
  • Analyze large groups of applicants and the skills and experience listed in their submitted materials (cover letters, resumés, etc.) to create a shortlist of qualified candidates
  • Mitigate human bias in the recruiting process using smart resumé review software that analyzes each data point objectively 

On average, healthcare positions are vacant for 84 days (for entry-level roles) to 207 days (for senior-level roles), with an estimated recruitment cost of $2,000 to $5,700. Speed is of the essence when it comes to filling open positions, and AI can accelerate certain steps in the process to save much-needed time. 

But the application of AI in employee recruiting still raises important ethical questions. Resumé parsing software, for example, can help reduce human bias in the recruiting process—but only if the organization is thoughtful about how the AI program is trained and how it is overseen by staff. It must be trained in a way that does not reinforce existing human biases and it must be monitored by skilled staff members who direct the program to use the best fields to minimize human bias and maximize skills-based decision-making.  

Recruiting KPI How AI can help
Time to hire AI can help communicate with candidates and perform large-scale analysis of applicants to make data-informed decisions more quickly
Staff retention rate Use AI to create training scenarios, questions, and insights that make onboarding more enjoyable for new hires, and give managers AI-enhanced tools for ongoing staff coaching and career development
Employee engagement AI can automate the types of tasks that cause frustration and burnout among healthcare operations staff, and AI can improve the onboarding and training process for new hires, which has an outsized impact on their engagement; when workers are more engaged, they stay in their roles longer, they get higher marks for customer services, and the organization as a whole is 23% more profitable on average

Where does AI go from here?

AI has tremendous potential when it comes to healthcare administration. Its ability to improve scheduling, communication, and other tasks can transform healthcare operations management for the better.

Beyond operations alone, AI is poised to make huge improvements to healthcare delivery. Already, research shows that algorithms are effective at spotting malignant tumors in radiology images, and they can help researchers put together diverse cohorts for clinical trials. In the future, we will see AI-assisted treatment gain credibility and popularity.

Of course, implementing AI in healthcare operations management comes with significant challenges. Transformational change in any healthcare system takes significant planning, time, and effort. Healthcare providers and recipients alike have legitimate concerns about privacy, safety, and prevention of bias. Healthcare leaders will have to balance investment in their people with investment in AI technology and proceed at a pace that the workforce can accommodate.

AI-enhanced scheduling by Skedulo

Getting started with AI is as simple as choosing the right software for your healthcare operations. Skedulo is an intelligent scheduling platform that helps healthcare companies optimize their scheduling and dispatching operations based on their own KPIs. With a user-friendly app and built-in communication, Skedulo gives your healthcare operations team the tools to manage and support the deskless workforce. 

Home healthcare workers, mobile phlebotomists, ambulance services, traveling therapists, and all other mobile caregivers benefit from great tools with thoughtful AI features that save them time. To learn more, check out our webinar How to Improve Caregiver Satisfaction and Retention with Mobile Technology.

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