Healthcare leaders from around the U.S. convened at the 13^th annual J.P. Morgan Healthcare Advisory Council in New York to address these challenges. The wide-ranging discussions covered AI implementation, strategic partnerships, consumer-centric transformation, drug pricing and transparency and technological innovations across the health care ecosystem. In our analysis, we’ve captured a few key takeaways from these conversations that are shaping the industry.

1. AI moves from pilot to production—with tangible results

Artificial intelligence has progressed into production environments where it can deliver measurable outcomes.

Hartford HealthCare’s partnership with MIT demonstrates the operational impact: An AI platform analyzing patient data reduced length of stay by one full day across six Connecticut hospitals.

The collaboration resulted in practical solutions, including an emergency department scheduling system that now finishes a monthly task in just three seconds—a task that previously required three full-time employees working manually.

Hartford HealthCare also implemented a clinical documentation AI tool across physician practices. Within weeks, the technology reduced the documentation burden while maintaining detailed records. Physicians reported unprecedented improvements in work satisfaction and more time to focus on patient care. 

2. Policy uncertainty demands scenario-based planning

Health care organizations face an evolving regulatory landscape that requires adaptive strategic planning.

The One Big Beautiful Bill Act restructures Medicaid through a series of phased-in changes beginning Jan. 1, 2027, with additional provisions rolling out through 2029. This timeline gives health systems a window to plan before major funding and eligibility requirements shift.¹

“It’s scary, but I think now that it’s sort of known, it takes a little bit of that sting out,” said Kevin Holleran, senior director at Fitch Ratings.

Federal research funding faces potential restructuring: For FY 2026, the administration proposed reducing the National Institutes of Health (NIH) budget from over $46 billion to $27.9 billion—a 39% decrease that would affect both current operations and long-term innovation pipelines.² Actual funding for NIH remains pending in Congress; a continuing resolution has kept FY 2026 funding at FY 2025 levels through Jan. 30, 2026. The economic impact extends beyond direct funding: NIH investments support approximately 400,000 jobs and generate close to $100 billion in economic activity, according to the advocacy group United for Medical Research.

Rating agencies emphasize that organizations demonstrating proactive planning receive more favorable assessments than those waiting for policy clarity.

“We like to see about three years of planning,” said Lisa Martin, SVP at Moody's. “It’s less about timeframe, more on how you're building in contingency.”

3. Strategic mergers and acquisitions: Mission and market density drive success

Mission-driven M&A contradicts the conventional thinking around financial returns.

MultiCare Health System shows how intentional M&A strategy differs from opportunistic consolidation. The Tacoma-based nonprofit set a precise objective: touch the lives of one-third of the 16 million people across Washington state, Oregon, Idaho, western Montana and Alaska.

“We define our goal in terms of market essentiality,” said James Lee, executive vice president and CFO of MultiCare Health. The approach prioritizes mission, vision and values alignment before financial metrics.

Over a decade, MultiCare increased density in the market and grew revenue from $1.8 billion to $6.5 billion. About 30% of the growth came from organic expansion at existing hospitals, 41% from M&A and 29% from targeted ambulatory growth, Lee said.

MultiCare now operates more than 50 urgent-care centers and eight off-campus emergency departments, expanding access while positioning the organization to manage risk effectively.

Screening for organizational fit upfront helps prevent costly post-merger challenges. “After every integration, we look back and ask: What have we learned? What should we do differently?” Lee said.

4. Consumer-centric models reshape revenue and access

Health care delivery is shifting from hospital-centric to consumer-directed models, altering revenue composition and care delivery.

For example, Hartford HealthCare’s system now generates 18% of revenue through ambulatory environments, compared to just 4% a decade ago, said Jeff Flaks, CEO of Hartford HealthCare. Hospital-based revenue declined from 87% to around 70% during the same period.

 “Think about your life—where else do you wait 10 months for anything?” Flaks asked, referencing wait times to schedule a physical exam with conventional health care providers. “You want transportation, entertainment, food, restaurant reservations—you get it at the place and time you want it.”

Hartford HealthCare’s HHC 24/7 platform offers on-demand primary care, available scheduled or unscheduled. The telehealth service is approaching 20,000 visits a year with more than 200 patients daily—cutting a monthslong wait for an appointment to same-day access via telehealth. “The 26 providers don’t have medical assistants, don’t have physical offices,” Flaks said. “They can cover the entire state rather than being exclusive to a single geography.”

Virtual and ambulatory care can meet patients where they are, and they typically require much lower infrastructure investment than traditional brick-and-mortar expansion. The transition demands institutional courage: Spending on lower-margin, higher-access services while hospital volumes remain strong requires conviction about long-term trends.

“If you’re a public company reporting quarterly, it would be hard to convince your board to make these investments,” Flaks said. Nonprofit structures allow for longer planning horizons—playing the essential long game.

5. For-profit partnerships: Navigating capital, control and mission

Health care organizations increasingly leverage for-profit partnerships to fund growth and access specialized expertise.

The relationship model allows health care organizations to maintain governance and economic participation while accessing capital and operational expertise. Welsh Carson partner Brian Regan emphasized the diversity of these structures, which allow health care providers to find the best fit. “Most of the concerns around governance, capital allocation and management can be governed by the terms of the partnership itself,” Regan said.

Yet fundamental tensions exist. Private equity tends to strategize on a three- to seven-year horizon, while nonprofit missions span generations. Each side of the deal needs to understand the goals and motivations of the other. “If you marry a PE firm, recognize that they have pressures to deliver liquidity to their LPs,” said Terry Myerson, CEO and Co-Founder of Truveta, a patient data consortium. “That’s different than saying ‘I want to optimize for my community or innovation.’”

Organizations succeeding with for-profit partnerships are constructing the arrangements thoughtfully to ensure the mission and financial imperatives are aligned.