A recent analysis by the Blue Cross Blue Shield Association uncovered that the adoption of artificial intelligence tools in hospitals resulted in nearly $1 billion in increased healthcare spending over two years.
The new study indicates that the significant rise in the documentation of patients with complex conditions led to an additional $942 million in medical care costs for Blue Cross and Blue Shield (BCBS) companies from 2023 to 2025.
According to the report, there are concerns that the growing use of AI coding tools is contributing to escalating healthcare expenses in the U.S. This trend, in turn, impacts premiums and out-of-pocket costs for families, employers, and taxpayers. The research involved secondary diagnoses, like anemia following major bowel surgery.
BCBSA Senior Vice President of Product and Data Science, Luke Chalker, stated that if patients were genuinely sicker, one would anticipate seeing increased treatment. Notably, there’s a rise in anemia diagnoses in these hospitals, yet there isn’t a corresponding rise in transfusions.
Chalker also pointed out that the disparity between diagnoses and actual treatment hints that AI might be identifying more conditions that justify billing, rather than indicating sicker patients.
The Blue Cross/Blue Shield Association says that AI is already driving *up* healthcare costs, as hospitals use the technology to find instances where they can bill more for the same level of care. https://t.co/af1SzA7D8v pic.twitter.com/mstup0IfpP
— Joe Weisenthal (@TheStalwart) September 27, 2026
The study further reveals that about $650 million of the increased costs for BCBS companies resulted from secondary diagnoses that moved claims into higher-reimbursement categories between 2023 and 2025.
David Merritt, Senior Vice President of External Affairs at BCBS, acknowledged families’ frustrations regarding rising healthcare costs, emphasizing the importance of addressing the underlying causes. He noted that as families grapple with higher expenses, this research highlights the urgent need for a better understanding of these AI tools and their potential impact on the affordability crisis.
Experts had earlier indicated to the Daily Caller News Foundation that certain AI tools might play a role in increasing healthcare costs over the coming year.
The unaffordability of health care costs remains a pressing issue as the midterm elections approach in November. A survey conducted by NBC News in September revealed that U.S. voters favor Democrats over Republicans on healthcare by a significant 22 percentage points.
