Third Way Health (TWH) has released its State of Practice Management 2026 report, based on a survey of 200 US healthcare executives, examining staffing, artificial intelligence, outsourcing and patient access across healthcare front-office operations.
The survey identified a gap between executives’ concerns about adopting AI and reported outcomes among organizations already using it. Patient experience was cited by 80% of respondents as a reason for hesitating to introduce front-office AI. However, 79% of executives whose organizations had implemented AI identified improved patient experience as their most frequently reported outcome.
“For years, healthcare organizations have suspected that if they brought in AI or moved work outside of their four walls, it might compromise how their patients experience their healthcare,” said Frederik Mueller, Co-Founder and CEO of Third Way Health. “With the data showing the opposite is true, it’s clear that the biggest barrier to improving patient experience is fear itself. It’s holding back healthcare organizations from providing the highest possible quality of experience.”
The survey reported a similar pattern for outsourcing. While 55% cited the quality of patient interactions as the leading barrier to further outsourcing, 77.5% of organizations already outsourcing identified improved patient experience as their leading outcome.
Staffing remains another challenge. According to TWH, 92.5% of practices reported they were not fully and sustainably staffed, while front-office turnover reached at least 40% in nearly three in ten organizations.
Among executives using AI, 59% cited the continued requirement for human backup as a major challenge, compared with 38% citing vendor support and ongoing management, 32% staff adoption and 11% cost relative to results.
Adoption also varied by organization size. The survey found 91% of large practices automate at least one front-office function using AI, compared with 72% of midsize practices.
Respondents generally favored combining technology with human staff rather than replacing employees entirely. No executives selected a predominantly automated front office with minimal staffing as their preferred model, while 85% favored hybrid or technology-enabled teams supported by managed services.
TWH currently combines AI with service teams to support front-office functions including patient calls, scheduling, eligibility verification, prior authorizations and referrals.
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