From the rapid evolution of digital health to innovative models of care delivery and coordination, there are countless issues impacting the healthcare industry right now and shaping its future. Venable recently hosted a conference on the state of the industry, bringing together firm attorneys and a cross-disciplinary group of policy leaders, health system innovators, cybersecurity professionals, and industry advocates to discuss such topics as cybersecurity, telehealth, artificial intelligence (AI), and federal policy developments.
One overarching theme shaped every discussion—technology is rapidly transforming the healthcare industry. Here are three takeaways that businesses and organizations should consider to protect themselves and stay competitive in this evolving space.
Cybersecurity Risk Is No Longer Just an IT Issue
Cybersecurity is a major concern for the healthcare sector, as data breaches and cyberattacks threaten patient safety, the economy, and national security. Additionally, a lot of organizations are still relying on legacy technology that was not designed to stand up to modern threats.
Amid geopolitical competition, nation-state actors are targeting critical infrastructure systems like transportation networks, supply chains, and electrical grids. And they aren't just looking to spy on the competition; they are seeking to actively disrupt crucial sectors to gain leverage over other nations.
Ransomware remains the most immediate threat to U.S. infrastructure. Cybercriminals rarely work alone today but rather form groups that emulate the work of others (like a franchise model). They are highly sophisticated, often knowing our critical infrastructure better than we do and even conducting market research to determine the most effective areas to strike and increase the likelihood of victims paying the ransom.
In a recent shift, hackers are no longer just encrypting networks and demanding ransom to unlock the network. Instead, they are focusing on obtaining specific and sensitive information. And in the healthcare industry, criminals are not just looking to extort companies; they are targeting individuals as well, threatening them with the release of personal data.
To combat these threats, organizations and individuals must tighten their cybersecurity systems, as criminals will take advantage of vulnerable spots. In the healthcare sector, end-of-life and service technology are potential targets for criminals. They are also focused on third-party vendors with thousands of customers downstream that they could also extort.
The reality is that today it is impossible to stop all attacks, and organizations should focus on fast detection, a swift response, and a safe recovery. AI is also allowing criminals to find vulnerabilities in record time, so businesses can no longer operate at human speed. They must be prepared to maintain operations in adversarial situations, adopting a non-stop mentality to continue to deliver patient care when systems are down.
AI Is Here to Stay, and Organizations Must Keep Up and Adapt
From AI tools to digital health innovations, telehealth visits to wearables, technology in the healthcare industry is raising significant concerns around privacy, transparency, and consent. Additionally, innovations like vibe coding (using AI to build applications with natural language prompts) make it easier for almost anyone to quickly create new tools, speeding up the pace of innovation.
Such rapid development leaves regulators struggling to keep up. With a lack of federal guidance, states are taking the lead, with some even introducing legislation that would license AI as a healthcare provider. This dynamic regulatory environment puts organizations in increasingly uncertain positions.
Also complicating matters is the evolution of technological devices from support tools into increasingly autonomous forces capable of assisting with clinical decision making, diagnostics, and even patient engagement. While technology begins replacing frontline tasks, there are some hard lines dividing those applications where it can and cannot be used. Healthcare organizations must establish governance frameworks and ethical guardrails to ensure that technology advances patient care without compromising trust or safety.
For example, chatbots can often solve patients' problems rather than just directing them to a human. Some AI models can effectively evaluate MRIs and x-rays. They can also take notes and analyze data, helping physicians determine the types of care to provide and suggesting diagnoses to consider. However, many of these tools are not yet proven enough to replace the insight of a human. Nevertheless, technology can help people help themselves when appropriate and reserve the capacity of the healthcare system for those that need the most critical care.
Another challenge is this new technology being forced into the old systems in which health systems work. Pagers and fax machines are still commonplace in medical settings, and innovation presents the opportunity to redesign processes and take advantage of transformational technology, like digital care delivery, remote monitoring, and predictive models.
Despite Advances in Technology and Policy, Care Coordination Remains Difficult
In today's healthcare environment, patients frequently move between providers that operate independently of one another, often leading to confusion and potentially disjointed care. Coordinating care between entities as varied as pharmacies, behavioral health services, hospitals, and post-acute and long-term care providers remains a challenge, leading to misaligned payment structures and accountability systems, technology gaps, and workforce shortages, especially in rural care settings.
Telehealth expansion, integrated care models, pharmacist-led interventions, and emerging applications of AI may help aggregate information and support coordinated decision making. Other potential gamechangers are payment models and policies that reward collaboration across healthcare providers. Additionally, providers are increasingly shifting from fee-for-service to value-based care, which encourages coordination and rewards outcomes rather than volume. But there are obstacles that stand in the way of change.
There is currently a lack of reimbursement or financial incentives for providers to change their processes and systems to coordinate with others, and each type of provider has its own unique challenges. For example, pharmacists rarely spend time with patients to coordinate care, so how would they bill for those services?
Privacy restrictions also confuse stakeholders regarding what they can and cannot share with other providers, as well as how they share important information using different Electronic Health Record (EHR) platforms. This is particularly problematic in behavioral health settings.
The healthcare system was not designed with integration in mind, so big changes are needed to coordinate care. Different funding streams and payment models that reward collaboration are seen as important pieces of the integration puzzle. Further advances in technology, like AI for data aggregation, workflow support, and detecting risks, could also move things in the right direction for easier coordination of care. Both of these solutions are reliant on additional policy changes, and fortunately the movement toward value-based care is garnering bipartisan support.
Get Ahead of Challenges and Stay Informed
A range of laws and regulations at the state and federal levels heavily influence all three of these areas. Businesses and organizations engaged in healthcare delivery, technology, and services must keep up with all proposed legislation to stay ahead of threats and leverage opportunities, and success often involves direct and ongoing engagement with elected officials and regulators to advance and protect interests.
We're here to help businesses navigate the complicated healthcare landscape and constantly changing laws. If you or your organization have questions about legal considerations in the healthcare industry, please contact an attorney in Venable's Healthcare Group. If you have questions about federal legislative or regulations in the healthcare arena, please contact a member of the firm's Health Policy team. To receive timely alerts from the Healthcare Group, subscribe here.
To learn about additional Venable services highlighted at this event, please contact attorneys and policy professionals in our Cybersecurity, Artificial Intelligence (AI), and Legislative and Government Affairs teams.