Charting the Structural Growth Opportunity in Health Care Technology

Health care technology is becoming a structural growth market because AI can expand capacity, improve outcomes and reduce costs amid rising demand and persistent inefficiencies.

• US health care spending reached approximately $5.3 trillion in 2024, about 3.8 times its 2000 level, and is projected to exceed one-fifth of GDP by 2033.
• By 2030, every baby boomer will be at least 65, while patients already wait an average of 31 days to see a physician and more than one-third of US adults delay care because of cost.
• Health care productivity has lagged broader private-sector productivity, while administrative activities are estimated to absorb 15% to 25% of national health care expenditures.
• AI can address these constraints through drug discovery, diagnostics, clinical documentation, claims processing, prior authorization, clinical decision support and interoperable data platforms.
• The authors expect value-based care, digital therapeutics, remote patient monitoring, platforms and direct-to-consumer models to replace more volume-driven fee-for-service economics with scalable and recurring revenue.

Takeaway: Investors should focus on late-stage health care technology companies that use data and AI to improve outcomes, expand access and lower costs simultaneously, while recognizing that execution, regulation, data quality and business-model scalability will determine which opportunities become durable competitive advantages.