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AI reached healthcare's back office first
Where AI started
The early wins came from work like writing the clinical note and adjudicating claims. These tasks were already so error-prone that a modest improvement matters, and they carry no direct diagnostic or treatment impact. They were also the areas AI could reach first as it developed.
The clinical note
The clinical note sits at the center of that back-end work. It turns a patient's background into structured language the rest of the healthcare system can use, and medical coding then translates clinical language into financial language so providers and payers can get paid.
What comes later
Work earlier in a patient's journey, such as finding care and being seen, involves patient trust, technology, regulation, and reimbursement, and those pieces are expected to take longer to mature. As computational capability grows, more complex and higher-stakes capabilities are opening up.
Why does medicine translate notes into codes?
Payers pay for standardized codes, not free text. In the United States, diagnoses are coded with ICD-10-CM, adopted in October 2015 and based on the World Health Organization's International Classification of Diseases. Procedures are coded with CPT codes, which the American Medical Association maintains. A single visit can generate many codes, each tied to a payment rule.
Why do language models suit clinical notes?
A clinical note is text built from a conversation, which is the kind of task language models do well. Ambient scribes record a visit, draft the note, and leave the physician to review it. A 2016 study in the Annals of Internal Medicine by Christine Sinsky and colleagues found that physicians spent nearly two hours on electronic records and desk work for every hour of direct patient care.
How does a claim get adjudicated?
The payer receives the claim and checks the patient's eligibility. It then matches the billing codes against coverage rules and compares the charge to the rate it has contracted with the provider. The claim is paid, denied, or held for more information. The patient receives an explanation of benefits and the provider receives a remittance advice, and each US payer keeps its own rules.
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