Kodiak Report: Hospitals Wrote Off $132B Despite AI Investment
Kodiak Solutions, a revenue cycle analytics company, reports that hospitals collectively lost an estimated $132 billion last year to write-offs from bad debt and final claim denials, up nearly 18% from 2024, with write-offs consuming about 10% of net revenue. The increase came despite rising hospital investment in AI and revenue cycle technology, with industry tech budgets up 7.6% to $69 billion this year per a Forrester report cited by Kodiak. Bad debt and final denial rates as shares of net revenue have stayed roughly flat over three years, but total dollar losses grew, which Kodiak attributes to high-dollar denials, case mix shifts and rising overall hospital revenue. Kodiak researchers say providers may be deploying technology to operate revenue cycle functions without the data depth needed to optimize financial performance.