The “unsexy” revolution within healthcare AI

The potential of AI for healthcare is undeniable, with the technology fuelling a resurgence of venture capital flowing into medical software and healthcare technology. While initial AI implementations often focused on novel, standalone applications like ambient AI scribes, a quiet but significant shift is now underway.  

The real revolution is happening in the back office. AI tools that can streamline provider operations and revenue cycle management — the largest and most entrenched cost centers in the system — are drawing the most attention and funding. In the near future, AI governance tools that allow clinical AI to remain within the necessary guardrails will also become increasingly popular. 

These developments reflect the maturation of healthcare technology as it transitions from standalone applications to “unsexy” innovations in provider operations and workflows. These innovations offer targeted support to healthcare participants while avoiding hype cycles. 

An end to AI scribes 

Ambient AI scribes are Generative AI software tools that use speech recognition to listen in to patient-doctor conversations and automatically transcribe them. These applications can also generate structured clinical summaries and referral letters – helping to reduce the time doctors spend on documentation and manual data entry.  

While proving a useful tool, the market is over-saturated, numbering over 150 standalone AI scribe companies. By the end of 2026, this is likely to collapse into a feature set. The top two to three players which are able to distinguish themselves from their competitors and prove the most trustworthy and scalable, will be acquired by Electronic Health Record (EHR) incumbents like Epic and Oracle or large platforms such as Microsoft and Nuance. The rest will either die or pivot, as ​​ambient listening becomes a commodity feature of the Operating System, not a venture-backable standalone product.  

The ‘App for that’ era of healthtech is over, killed by the expiration of pandemic-era reimbursement waivers and a rigorous demand for return on investment (ROI) from payers and providers. In its place we will witness a shift toward provider operations and Agentic AI workflows in 2026, that replace the cognitive drudgery of administration and empower those on the frontlines of healthcare. 

The year of Agentic workflows 

2026 will be the year that Agentic AI becomes embedded into administrative workflows, with autonomous systems soon set to handle over half of prior authorisations, documentation tasks and claims processing.  

We will also witness the rise of AI Sentinels becoming an integral feature of workflows in the near future, as this technology becomes mandatory. These are intelligent surveillance systems which are incorporated into clinical AI, such as diagnostic software, to monitor for errors, hallucinations, or bias. This technology ensures that AI tools meet regulatory compliance with healthcare standards such as the General Data Protection Regulation (GDPR), the Health Insurance Portability and Accountability Act (HIPAA), and other data regulations.  

By 2026, regulatory bodies such as the U.S. Food and Drug Administration (FDA) and the European Medicines Agency (EMA) will likely require these for the deployment of AI tools in healthcare. This will generate a nascent but growing market for “governance as a service” in healthtech. 

The rise of vertical AI 

The convergence of Agentic AI and proprietary healthcare data will create highly specialized intelligence that can become a valuable business asset. Known as vertical intelligence, this type of AI is trained on sector-specific data, such as genomics or radiology metadata, enabling it to solve specific clinical problems. Examples include specialized AI systems that operate within a particular niche, such as AI radiology environments. 

Vertical AI will become much more valuable than its counterpart – horizontal AI, which is trained on less specific, broader datasets. Examples include general AI assistants that are applied across multiple workflows, rather than tackling a single task. The lack of accuracy makes horizontal AI tools much less efficient, and their broader implementation means they are harder to regulate and risk assess. 

Optimising AI for a pragmatic future 

In 2026, healthcare AI is entering a more pragmatic and consequential phase, moving decisively from flashy, standalone applications toward deeply integrated, operational tools that address the system’s most entrenched inefficiencies. 

The hype around AI scribes will have largely subsided, consolidating into a few scalable offerings, while the real value will emerge from Agentic AI workflows that autonomously handle administrative burdens and safeguard regulatory compliance. This signals a shift in the broader maturation of healthtech.  

Success will increasingly hinge not on novelty, but on measurable impact, trustworthiness, and integration into everyday clinical operations. Simultaneously, highly specialized vertical AI will surpass horizontal intelligence in both utility and business value, offering precise solutions to complex problems. These trends represent an “unsexy revolution” where AI is no longer a standalone spectacle, but an embedded, intelligent force that empowers healthcare professionals without replacing them.