McKinsey: Reshaping US Healthcare With Technology and AI

McKinsey released its "What to expect in US healthcare in 2026 and beyond" report, delivering a stark assessment of the sector's trajectory.

The findings suggest that technology has evolved beyond a supporting function to become the primary driver of growth across the industry. The consultancy argues that health services and technology is poised to maintain its position as the fastest expanding segment, fundamentally reshaping how care is delivered and managed.

The report highlights how software platforms are increasingly embedded within the healthcare ecosystem, offering providers and payers new pathways to operational efficiency amid mounting complexity.

Technological innovation, particularly generative AI and machine learning, could create opportunities for stakeholders across multiple segments through workflow automation, enhanced data connectivity and interoperability, and the generation of insights from previously siloed information.

Pressure drives digital transformation

McKinsey's analysis reveals a concerning trend in industry profitability. According to the report, industry earnings before interest, taxes, depreciation and amortisation (EBITDA) as a percentage of national health expenditures, declined from 11.2% in 2019 to 8.9% in 2024.

This suggests that significant portions of the sector are grappling with compressed margins, increased utilisation and challenging reimbursement dynamics.

Despite these factors, certain growth segments are attracting substantial investment. Health services and technology, specialty pharmacy and non-acute care are drawing capital as efficiency demands accelerate outsourcing and digital transformation initiatives.

The consultancy identifies technological innovation as a recurring theme spanning payer operations, provider performance management and fundamental care delivery redesign.

For McKinsey, AI-enabled transformation has progressed beyond experimental pilots. Technology has become essential infrastructure for efficiency.

Brian Litten, co-founder and managing partner of AI technology healthcare venture capital firm Saltgrass, writes on LinkedIn: "Adoption will favour solutions that are measurable, implementable and reduce burden – especially in under-resourced settings where funding programmes may accelerate upgrades."

Michael Dreher, advisory board member of SiMLQ, adds: "McKinsey & Company's latest healthcare outlook highlights the challenges – rising costs, workforce shortages, reimbursement pressure, regulatory change and growing demand from an ageing population are forcing healthcare leaders to operate at two speeds: short-term resilience and long-term reinvention.

"AI is no longer theoretical. From prior authorisation and revenue cycle to workforce optimisation and supply chain execution, healthcare is finally seeing technology applied where it matters most – removing friction from complex, manual workflows that drain efficiencies and strain morale."

Automating administrative operations

Healthcare payers face mounting pressure from escalating medical and pharmacy costs, membership attrition and regulatory uncertainty.

McKinsey forecasts that "after 2027, payer recovery will depend on adoption of new care models, optimised pricing models, industry partnerships and AI-enabled backend transformations".

In operational terms, this could translate to automation in claims adjudication, predictive modelling for risk adjustment and machine learning applications designed to detect fraud and optimise backend processes.

Providers confront comparable challenges, according to McKinsey's research. Labour cost volatility, rising uncompensated care and shifting reimbursement models have eroded margins across the provider landscape.

However, McKinsey identifies a potential recovery pathway: "Beyond 2027, the shift of uninsured individuals into employer-sponsored coverage as they gain eligibility in their current roles or seek new employment with health coverage will support provider margin recovery.

"Providers are expected to adopt further cost-management measures to support margins."

Next-generation revenue cycle solutions, decision support analytics and AI-assisted clinical scribing are among the technologies that could enable this financial stabilisation.

Building smarter healthcare systems

McKinsey's analysis frames the next phase of US healthcare as an opportunity to construct more intelligent systems. The research suggests that vendors capable of building trust through clinical-grade accuracy, integration fluency and demonstrable outcomes will succeed.

Those unable to deliver on these metrics could find themselves marginalised as the sector's digital transformation accelerates. The consultancy emphasises that successful technology adoption will require more than innovative features.

Healthcare organisations are seeking solutions that integrate seamlessly with existing workflows whilst demonstrating clear return on investment. This means vendors must prioritise interoperability, user experience and measurable clinical and financial outcomes.