Next-Generation IT

AI is here and it’s time to change: CEOs must adapt in the new age

Tom Sullivan | December 23, 2019

Key Takeaway: Provider and payer CEOs are preparing for how AI&ML will change three key areas of the business: the C-suite, growth strategies and partnerships.

Despite the futuristic, if not frustrating, terms artificial intelligence and machine learning, AI&ML are neither about algorithms nor are they all that different than digital health from the CEO perspective 

Much like that broad umbrella term digital transformation, in fact, AI&ML are quickly becoming a necessity for sustainability, from a financial, operational, clinical and competitive standpoint.  

“Where the rubber meets the road is change management,” says Trishan Panch, MD, co-founder and Chief Medical Officer at Wellframe, and author of The Inconvenient Truth about AI, in the journal Nature’s NPJ Digital Medicine earlier this year.  

Acknowledging that AI “changes everything,” Steve Klasko, MD, President and CEO of Thomas Jefferson University and Jefferson Health, points to three key areas that are changing at Jefferson: the C-suite, growth strategies and partnerships.  

The C-suite  

AI, along with analytics and other emerging technologies, is giving rise to a range of new titles, from the broader Chief Digital (or Data) Officer to chiefs of transformation, innovation, or to the more specific Chief Artificial Intelligence Officer. Earlier this year, Anthem hired former Apple vice president Ted Goldstein as its Chief AI Officer and Cambia Health Solutions appointed Faraz Shafiq to Chief Artificial Intelligence Officer in September of 2018, as just two examples.  

“AI changes who’s sitting around me,” Klasko says. The CFO and COO will always be important, of courseAt the same time, innovation is becoming the driver for getting to the next stage, so Klasko envisions new C-suite members with backgrounds in investment or venture capital accustomed to strategically thinking about the future.  

[Learn more at the upcoming Executive Briefing: Artificial Intelligence & Machine Learning. 

“Very shortly, right next to me will be a Chief of Consumer Segmentation, a C-suite entity to inspire loyalty among different segments,” Klasko adds.  

Growth strategies  

Expanding the C-suite sets the stage for the second, and perhaps most significant, change associated with AI — having growth strategies and the marketing and communications that enable those.  

“My goal is that people join the Jefferson club when they’re well, not when they’re sick and choosing between Jefferson or Penn,” Klasko says.  

With Klasko – who is also the first Distinguished Fellow of the World Economic Forum for the Future of Health and Healthcare  Jefferson is on the forefront. When it comes to growth strategies for many organizations, however, 2020 is shaping up to be a reality check year, according to PWC 

In its 2020 AI Predictions report, PwC says the 1,062 participants rank the biggest challenges for using AI to advance business models as measuring ROI (39 percent), training current employees (36 percent), making the business case (34 percent), recruiting skilled AI workers (30 percent), among others.  

The firm found that just 4 percent of participating executives across a variety of sectors, not just health care, plan to deploy AI enterprise-wide in the next 12 months, which is surprising given that 20 percent had intended to do so in the previous year’s survey.  

Partnerships: Traditional and cutting-edge  

For those moving forward with AI, Wellframe’s Panch recommends that the immediate investment should be in change management. He says CEOs will face the decision of whether it’s better to build or buy new AI tool and machine learning algorithms – as well as partnering with technology companies.  

[Download the Health Evolution CEO Briefing Room Report: Strategies for Succeeding with AI.]  

At many health organizations, in fact, AI and digital transformation more broadly, are changing the nature of vendor-customer relationships.  

“Our gating mechanism is to look at whether this is a partnership with equity, co-development, or are you selling me something?” Klasko says. “If you sell me something you go about ten steps down.” 

That differentiates Jefferson and has thus far been successful enough at bringing dollars into its innovation fund that for the first time, Klasko says, it matches that of its hospitals.   

Another breed of partnership that is becoming increasingly important is the non-traditional variety, notably CVS and Aetna or UnitedHealth Group and Walgreens, which are becoming a new front door for patients.  

“What are the vertical partnerships large health care organizations see other than getting more hospitals into their system?” Klasko says. What are those creative arrangements?”   


When the first 2 to 5 percent of events or use cases are AI, not when it’s 95 percent, from my point of view it's done.

Vinod Khosla, Khosla Ventures

Why to prepare now for the AI-enabled future 

At the Health Evolution Summit earlier this year, Khosla Ventures founder Vinod Khosla likened the coming stages of AI to the maturation of cell phones.  

Every three to four years since [the first cell phone], we’ve had a significant turn. There was the Motorola, it’s iconic. Then there was the Nokia phone, the flip phone, the Blackberry, the iPhone 1, all the way to the iPhone X today,” Khosla said. “AI in healthcare will follow a similar path. Today, few people use it, it’s not really that functional. It’s a little too expensive. By the eighth generation or the tenth generation you’ll see something phenomenally different.”  

The first stage is proving that a specific technology can be useful, Khosla said, and that stage is done. He cited as an example the Journal of the American Medical Association officially saying it no longer accepts papers that prove algorithms are better than humans because it’s already sufficiently proven.  

The second stage for health care will be when clinical applications are being used  and health care is moving in that direction.  

[Infographic: 4 ways AI is making an impact in health care.] 

Blue Cross and Blue Shield of Louisiana CEO Steve Udvarhelyi, MD, who will be the Master of Ceremonies at the upcoming Health Evolution Executive Briefing: Artificial Intelligence & Machine Learning, says health care is beginning to see the application of augmented reality and AI in healthcare, notably pattern recognition as one example. 

 “If you’re trying to look at a dermatology scan for melanoma, AI can do a really good job at that, and retinal screening for diabetic retinopathy, in some cases doing it with less error than clinicians,” Udvarheyli adds. “So that’s an interesting change.” 

Even a small number of apps using AI will be game-changing, Khosla contends.  

“When the first 2 to 5 percent of events or use cases are AI, not when it’s 95 percent, from my point of view it’s done,” Khosla says. “That’s a timeline to keep in mind.”   

In other words, AI can no longer be ignored, adds Fahad Aziz, Co-founder and CTO of Caremerge, a software company that caters to the long-term living market.  

AI is coming in a meaningful manner to help CEOs  not to add another note of complexity,” Aziz says“CEOs need to take in AI and new technologies with an open mind. Let go of your experiences in the past with technology that was half baked and not ready for scale. This is a new era. The technology has evolved.” 

How AI will change the role CEOs play is among the scheduled topics at the upcoming Executive Briefing: Artificial Intelligence & Machine Learning in Laguna Niguel, California, April 1, 2020 during the Health Evolution Summit. View the agenda.  

Health Evolution Senior Manager of Digital Content Gabriel Perna contributed to this article. 

About the Author

Tom Sullivan, EVP & Editor-in-Chief of Digital Content

Tom Sullivan brings more than two decades in editing and journalism experience to Health Evolution. Sullivan most recently served as Editor-in-Chief at HIMSS, leading Healthcare IT News, Health Finance, MobiHealthNews. Prior to HIMSS Media, Sullivan was News Editor of IDG’s InfoWorld, directing a dozen reporters’ coverage for the weekly print publication and daily website. Contact: or @SullyHIT on Twitter.