AI in Healthcare: When Billing Tools Drive Costs Up, Not Down
A new PwC report reveals that AI billing tools are projected to push commercial healthcare costs up by 9% next year, with nearly 70% of health plans citing AI documentation and coding as a top inflator. While providers argue the tools help capture correct codes, the trend raises questions about transparency and efficiency. For individuals and small teams, this underscores the importance of using AI for genuine productivity—like tracking expenses with ccLuca—rather than opaque cost inflation.
We often hear that artificial intelligence will make everything cheaper, faster, and more efficient. But reality, as usual, is a bit messier.
A new report from PwC, released this week, shows that health plans are projecting commercial healthcare costs to rise by 9% next year. And one of the culprits? AI itself.
Specifically, the increased use of AI documentation and coding tools by healthcare providers. Nearly 70% of surveyed health plans ranked this as a top three inflator for 2027. About 20% called it the number one driver.
Let that sink in. The technology we were told would streamline healthcare is, in some cases, making it more expensive.
The Problem: Better Coding, Higher Bills
Providers are rapidly adopting AI tools that record clinical notes, draft documentation, and suggest billing codes. The result? More complete and detailed records. Clinicians can now capture diagnoses and comorbidities they might have missed before.
But here’s the twist: that doesn’t always mean the patient received more care. It often means the provider can bill for a higher level of complexity—even if the treatment was the same.
“The ability to use technology and AI to more appropriately code or code things that they were never able to, that’s the trend we’re seeing,” said Glenn Hunzinger, U.S. health industries leader at PwC. “It does have an impact on that 9%, albeit it’s not the biggest piece.”
Hunzinger also notes that many health systems were probably missing correct codes due to the sheer volume of care and complexity of their internal systems. So the AI isn’t necessarily doing anything wrong. It’s just… doing its job. And that job happens to increase revenue for providers.
A System Under Pressure
Margins are thin for many hospitals, especially after the pandemic. Labor and supply costs remain elevated. Federal cuts to Medicaid are squeezing budgets further. So it’s no surprise that providers are turning to AI billing tools to stay afloat.
But here’s where I get opinionated: this is a symptom of a broken system, not a solution.
When the incentive structure rewards more complex coding rather than better outcomes, AI becomes a tool for inflation, not innovation. The technology itself is neutral. It’s how we deploy it that matters.
And right now, we’re deploying it to game the billing system.
What This Means for You and Your Wallet
If you’re an individual or a small business owner, you’re probably feeling this already. Higher premiums, higher deductibles, higher out-of-pocket costs. The 9% increase is a projection, but the trend is real.
So what can you do? You can’t control how hospitals code their bills. But you can control how you manage your own finances.
That’s where tools like ccLuca come in. While healthcare costs rise, your personal expenses shouldn’t slip through the cracks. Snap a photo, get AI-extracted data in three seconds, generate expense reports instantly. No IT, no enterprise software, no setup.
The expenses you forget to claim could buy you an iPhone every year. That’s not a gimmick—it’s a fact.
The Bigger Picture: AI for Transparency, Not Obfuscation
I believe AI should make life simpler, not more opaque. In healthcare, we’re seeing the opposite: AI that helps providers charge more without adding value. That’s not progress.
But AI can also be a force for clarity. For individuals and small teams, it can automate the boring stuff—like expense tracking—so you can focus on what matters. No hidden costs. No complex coding. Just clean, transparent data.
That’s the kind of AI I can get behind.
The Bottom Line
The PwC report is a wake-up call. AI is not a magic wand. It’s a tool, and like any tool, it can be used for good or for… well, inflating healthcare costs.
As consumers, we need to stay informed. As professionals, we need to demand transparency. And as individuals, we need to take control of the parts of our financial lives that we can actually influence.
Start with your expenses. They’re simpler than healthcare billing, and the ROI is immediate.
Source: Health plans say AI is pushing healthcare costs higher