The AI Boom Reaching Medical Claims

Good morning, ! This week we're covering the next chapter of the healthcare M&A recovery, the rapid rise of AI in medical claims processing, and the explosive growth of GLP-1 spending, with Medicaid expenditures climbing from $999 million in 2019 to $8.4 billion in 2024—a more than 740% increase in just five years.

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DATA DIVE

Healthcare M&A Enters Its Next Phase

Healthcare dealmaking is showing signs of recovery, but the next cycle will look very different from the one that followed the pandemic. According to PwC, transaction activity is expected to strengthen in 2026, even as volumes remain below the 2021 peak. The difference is where capital is flowing. Buyers are becoming increasingly selective, prioritizing strategic fit, scalable business models, and assets that can deliver sustainable competitive advantages rather than simply chasing growth.

Our latest report combines industry deal data with proprietary survey results from more than 450 healthcare executives, investors, and advisors to examine where M&A is headed next. We explore the sectors attracting the most investor interest, the obstacles slowing transactions, and the factors buyers now consider most important when evaluating acquisition targets.

The takeaway is clear. Healthcare M&A is entering a more disciplined era where execution, strategic alignment, and asset quality matter more than market momentum. For investors, operators, and corporate acquirers, understanding these shifts will be critical as competition for high-quality assets intensifies.

Link to report

HEALTHTECH CORNER

Healthcare AI Is Moving Beyond the Pilot Phase

Healthcare AI adoption is becoming increasingly measurable. New IQVIA data shows that augmentative AI has nearly tripled its use in medical claims over the past year, climbing from roughly 5,000 claims in March 2024 to more than 15,000 by April 2025. Meanwhile, assistive AI remains the largest category, consistently supporting approximately 13,000 to 16,000 claims per month, while autonomous AI continues to see limited but gradual adoption.

The divergence is telling. Providers appear most comfortable deploying AI that enhances clinical workflows rather than replacing clinical judgment. Documentation support, coding assistance, care recommendations, and administrative automation continue to scale because they deliver operational value while maintaining physician oversight. Fully autonomous diagnostic applications, by contrast, remain constrained by regulatory requirements, liability concerns, and the higher clinical evidence needed for widespread adoption.

Why it matters: Healthcare AI is entering a more practical phase. The next winners are unlikely to be companies promising fully autonomous medicine. They will be the platforms that integrate seamlessly into existing clinical workflows, improve productivity, and generate measurable ROI for providers. In healthcare, augmentation is proving to be a faster path to adoption than automation. (More)

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TREND TO WATCH

GLP-1s Are Becoming a Medicaid Problem

The GLP-1 story is no longer just about obesity. It's increasingly about public budgets.

Medicaid prescriptions for GLP-1 drugs surged from 999M in 2019 to 8.4B in 2024, an increase of more than 740% in just five years. Gross Medicaid spending followed the same trajectory, climbing from roughly $1 billion to $8.6 billion over the same period.

This growth is remarkable considering GLP-1s still account for only about 1% of all Medicaid prescriptions, yet they now represent more than 8% of total Medicaid drug spending before rebates.

Why this matters: GLP-1s are creating a fundamental tension in healthcare economics. On one hand, they offer the potential to reduce downstream costs associated with diabetes, cardiovascular disease, and obesity-related conditions. On the other, their upfront costs are forcing states and payers to reconsider coverage policies, with several Medicaid programs already debating restrictions.

The investment implication: The next battleground isn't efficacy—it's affordability. Expect accelerating innovation around oral formulations, manufacturing scale, outcomes-based reimbursement models, and care platforms that can prove long-term cost savings. The winners of the GLP-1 era may not be the drugmakers alone, but the companies that solve the economics surrounding them. (More)

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