Image: — © AFP Kirill KUDRYAVTSEV
Artificial intelligence is transforming healthcare administration, but not always in ways that benefit providers. AI is re-focusing many aspects of healthcare administration, in its different forms, as follows:
Scheduling and Capacity Management: AI-powered scheduling tools help balance provider availability, patient demand, and equipment capacity, leading to shorter wait times and better resource utilization.
Revenue Cycle Management: AI improves the accuracy and efficiency of revenue cycle management, which is critical for maintaining organizational stability and financial health.
Documentation and Coding: AI automates documentation and coding processes, reducing the burden on healthcare staff and allowing them to focus more on patient care.
Patient Communication: AI enhances patient communication through automated responses and real-time messaging, improving the overall patient experience.
These advancements are part of a broader trend where AI is being integrated into healthcare administration to address the challenges of rising costs, staffing shortages, and increasing regulatory demands. By leveraging AI, healthcare organizations can create more responsive systems that improve patient care and operational efficiency.
Insurance carriers are increasingly using AI systems to process and deny claims. While these systems promise efficiency and fraud detection, they are also facing legal scrutiny over allegations that algorithm-driven decisions lack nuance and fairness.
Such bias can manifest in various ways, such as underestimating the risk of certain patients or disproportionately denying coverage to protected classes. To address these issues, healthcare insurers are beginning to implement improved governance practices, including transparency, explainability, and fairness requirements. These measures aim to ensure that AI systems do not perpetuate existing biases and promote equitable access to healthcare services.
For dental and healthcare practices, the result is delayed payments, higher administrative costs, and mounting financial pressure.
Jordon Comstock, Founder and CEO of BoomCloud, tells Digital Journal that many practice owners are only just realizing how much leverage they have lost.
“Most dentists don’t see the denial pattern at first,” Comstock explains. “They just feel the cash flow tightening. What’s happening behind the scenes is that algorithms are flagging claims at scale. When that happens, practices become reactive instead of strategic.”
The Legal and Ethical Questions
Recent lawsuits against insurers argue that AI systems can produce wrongful denials by failing to account for individual patient circumstances. Plaintiffs claim that these tools may be biased or overly rigid, prioritizing cost control over patient care.
Comstock believes the bigger issue is transparency: “If an AI system denies a claim, who is accountable? Is it the adjuster? The software vendor? The carrier? Practices are left fighting a black box,” he says. “And small practices don’t have entire legal departments to challenge those decisions.”
The Financial Impact on Practices
AI-driven denials create a ripple effect, as Comstock finds:
Increased time spent on appeals
Slower reimbursements
Higher overhead due to billing staff workload
Patient frustration when treatments are delayed
For many practices operating on tight margins, this can be destabilizing.
“Dentistry is already navigating staffing shortages and rising supply costs,” Comstock says. “When insurance payments become unpredictable, it exposes how fragile the traditional PPO model really is.”
A Shift Away From Insurance Dependence
Some practices are responding by reducing reliance on insurance altogether. Comstock points to internal case data from practices using membership plan models. In one example, a dental practice launched a $45 per month membership plan and enrolled more than 1,400 patients.
The results:
Monthly recurring revenue of $63,000
Annual recurring revenue of $756,000
Predictable revenue allowed the practice to drop most PPO contracts and significantly reduce administrative burden: “The turning point for many dentists is realizing they can build their own recurring revenue system,” Comstock says. “Insurance should not be the only way patients access care.”
How Practices Can Protect Themselves Now
Comstock advises practices to take immediate steps. This runs:
Strengthen documentation and compliance protocols
Understand each insurer’s denial criteria
Train staff on structured appeal processes
Evaluate direct-to-patient membership models
“Appealing claims is defensive,” he concludes. “Building recurring revenue is offensive. The practices that survive long term are the ones that stop relying entirely on third-party reimbursement.”