The True Cost of Inaction

The true cost of inaction: What you lose without AI

Impact on profitability and ROI drives the majority of business decisions. Whether we’re thinking short-term or long-term, expected business impact is what dictates which plans get implemented and which plans fall by the wayside. Logical thinkers will examine key metrics like TCO, productivity, gross margin, and ROI to take calculated risks and do what’s best for business.

However, what’s often overlooked is the opportunity costs related to what you don’t do. How can you quantify what you missed out on by not doing something? ROI is important, but if you don’t consider COI (Cost of Inaction), you’re not truly analyzing the situation and doing what’s best for business.

Given the problems with healthcare operations that are weighing down many organizations in the industry, and the potential for modern, A.I. driven, process automation solutions to solve them; taking a holistic view of the true cost of inaction is vital to remaining competitive. In the healthcare industry, patient demands are on the rise, competition is stiffer than ever, and regulations are adding layers of complexity never before seen in the space.

What this means is, the organizations that are able to effectively quantify their potential ROI and COI given the current state of the healthcare operations are the ones who will make the best business decisions going forward. On the other hand, those who neglect considering COI or let aversion to change hold them back from pulling the trigger on an automation initiative, will find themselves struggling to keep up.

In this piece, we’ll drill down into the details of the cost of inaction, help you understand where automation can make an impact in healthcare, and how to take a holistic view of healthcare operations that considers both ROI and COI.

Tackling the challenges facing healthcare with automation

To begin to understand how to evaluate COI, it is important to understand the major problems facing healthcare operations today. At the end of the day, the COI of not automating is the cost of not solving these problems.


As we discussed in The Problem With Healthcare, the lack of interoperability between EHR systems and other software found in healthcare organizations leads to significant waste of human labor hours and inefficiencies in workflows. Getting data from one system to another to complete common work processes (e.g. eligibility checks) is tedious and prone to typos, oversights, and missing data. These mundane tasks are often prime candidates for an automated solution that can mitigate human error, increase process velocity, and reduce the amount of labor spent on low-skill tasks.

With automation, you begin to build an Internet of Healthcare, as data no longer sits in individual siloes, but can be accessed, managed, and used by a single user to expedite the administrative side of healthcare, and as a result, improve the patient experience.

Without healthcare automation, the number of systems that must be accessed individually continues to increase, human errors multiply, and inefficiency grows.


In a world where HIPAA compliance is of the utmost importance, maintaining the privacy and security of  PHI (protected health information) is vital to operating in the healthcare sector. The specific challenges related to healthcare administration in the U.S. add a significant layer of complexity to almost all data entry tasks. While leaving data entry workflows in the hands of humans is inefficient, when working with automated solutions, organizations must be cognizant of the risks associated with offloading that data to a software solution. For this reason, it is of the utmost importance to leverage automation tools built from the ground up with healthcare in mind, like Olive. Just how costly can failing to do so be? A HIPAA violation can cost from $100 to $50,000 per violation or per record.

Patient expectations & competition

The demands patients place on healthcare organizations are higher than ever. This is due in large part to the myriad of options available to them. The competition in the healthcare industry is more fierce than ever. More and more hospitals and clinics are popping up across the nation and online & mobile healthcare services are vying for patients along with their brick and mortar counterparts. If you’re not willing to adapt and streamline operations to keep up, you can rest assured your competitors are.

Technology can be a major differentiator to separate one organization from another. In the world of healthcare, the success of Osler Health, a network of healthcare providers that emphasizes the use of enhanced technology helps drive this point home.. For example, Osler was recently able to leverage advanced analytics to resolve interoperability and gain actionable insights consistent with an emphasis on data driven care. It’s this sort of emphasis on technology that helps Osler stay ahead of competition with deeper pockets and provide better overall patient care.

What about the competition for talent?

Talent is an oft-overlooked aspect when discussing automation in healthcare. When it is brought up, it is usually used to argue against automation for fear it will demoralize employees. While you may think a large chunk of your staff is automation-averse because it will take all their jobs, this is an incomplete, but not completely unwarranted, view of the impact automation has on the human workforce.

We believe AI should be about scaling humans. Freeing up staff to focus on more important, creative, and complex tasks that drive business and improve patient experience. Additionally, there are actually a number of positive statistics related to A.I. and the job market. For example, some experts have predicated AI will have a neutral effect on the job market. Further, according to PwC, 74% of employees would be more likely to stay with an employer offering training in A.I., RPA (Robotic Process Automation), or data analytics; in an environment where competition for talent is fierce, this is a big value-add for any organization looking to retain valuable employees, particularly when you consider that some experts peg the average cost of employee turnover across all positions in the healthcare industry at around $60,000 USD

The cost of inaction vs the benefits of adopting automation

Now that we have covered the challenges facing healthcare qualitatively, how do we quantify the COI? What’s the cost of not doing something? At the process level, this is best answered by identifying the workflows that would benefit from automation, and considering the bottom-line impact of solving those problems. You can begin to see significant value from automation in healthcare businesses of almost any size.

As a rule of thumb, repetitive data-entry processes that require two full-time employees or more are good candidates for automation. Once you identify these work processes and how much they are impacting your bottom line, you have an idea of your COI for that process can begin to ask yourself if you can afford NOT to offload them to an intelligent automation solution.

At a higher-level, organizations must also consider the long-term impacts of inaction. Even if you are able to afford spending more time and money having humans execute tasks that are robotic in nature, will you continue to be able to compete with competitors that make the leap and automate? Will you be positioning yourself as Blockbuster to the Netflixes and RedBoxes of the healthcare sector?

Real world data

While the specifics of numbers any given organization calculates for the ROI and COI of a given endeavor will vary, there is real world data available today to help us understand the potential impact of leveraging or not leveraging AI. Here are some useful statistics and real world use cases to consider:

  • Denials of eligibility cost hospitals & health systems over $262 Billion USD annually
  • 61% of eligibility denials are caused by missing information, a problem easily addressed by software
  • AI-powered RPA like Olive can reduce eligibility processing costs by 200%
  • With OliveAI, Hancock Regional Hospital (PDF) was able to completely eliminate of denials their payer, Anthem, as well as Medicaid and Medicare. Further, Hancock saw a 34% reduction in their days in accounts receivable.

Given we are still in the early adopter stages of operational AI in healthcare, we can expect these benefits to continue to rise until AI crosses the chasm into mass adoption. This means that the organizations that act now will be ahead of the curve relative to the rest of the market.

Conclusion: Understanding COI leads to better business outcomes

The takeaway here is clear: Don’t just ask “what’s the cost of doing X?” also ask “what’s the cost of doing nothing?”. When evaluating a business decision, including the true cost of inaction in your calculations can make or break your business outcomes. The problems facing the healthcare industry today are different than those facing the industry in decades past. There is a significant risk to businesses that fail to adapt. Not only will it cost them dollars in the short term, the change averse in the industry today are likely to become the healthcare version of Blockbuster tomorrow.

Complexity and competition are on the rise, and in order to effectively meet the demands of patients, while staying compliant and optimizing processes, organizations must be willing to adopt technologies that enable them to do so. When it comes to healthcare administration issues, intelligent automation solutions like RPA and A.I. are uniquely positioned to solve today’s problems and allow businesses to economically scale their work processes.

If you’re interested in learning more, we’re here to help! At Olive, we are dedicated to building world-class automated intelligence solutions specifically designed to solve the challenges facing the healthcare industry. If you have questions about how A.I. can help drive your healthcare business forward, please contact us today to work with our team of healthcare automation solutions experts.

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