How AI and Contracts Are Empowering Healthcare Organizations to Manage Complexity at Scale

Healthcare and life sciences organizations enter 2026 managing a level of complexity that few legacy operating models were designed to handle.

Both horizontal and vertical integration remains a core strategy for growth and stability, while margin pressure continues to intensify due to labor costs, reimbursement constraints, pricing reform, and regulatory oversight.

Contracts reimbursement variability sits at the center of these forces—governing how organizations get paid, share risk, and execute strategic partnerships. Increasingly, the challenge is not negotiating contracts, but managing them at enterprise scale.

Providers: Integration Turns Contracts into a Risk Surface

For healthcare providers, both horizontal and vertical integration has dramatically expanded contract portfolios. Healthcare M&A activity recorded 415 transactions in the first half of 2025, maintaining momentum despite fluctuating macroeconomic pressures. Acquisitions, joint ventures, and affiliations bring thousands of inherited payer agreements, supplier contracts, physician arrangements, and service partnerships—often with inconsistent terms and limited visibility.

AI is being used to accelerate contract analysis during due diligence, helping organizations surface pricing structures, obligations, and risk exposure before and after transactions close. Post-integration, AI supports more consistent contract oversight across newly combined entities, reducing reliance on manual review and fragmented systems.

Payers: Managing Complex, Varied Reimbursement Structures

Healthcare payers face mounting pressure to control costs while expanding value-based and performance-driven arrangements. Value-based care arrangements now account for nearly 30% of U.S. healthcare payments with downside financial risk—up from 24.5% just a few years ago—reflecting an accelerating shift from traditional fee-for-service models. These contracts add more complexity to underlying fee-for-service, with terms tied to outcomes, utilization thresholds, and reconciliation methodologies.

AI is increasingly applied to interpret contract language at scale and connect it to operational and claims data, enabling more continuous oversight of performance and compliance. This shift allows payer teams to move beyond periodic audits toward more proactive contract management.

Life Sciences: Scaling Innovation Without Losing Control

In life sciences, organizations continue to innovate while operating under growing pressure to improve efficiency and accountability. Global contract portfolios now span commercialization, licensing, clinical trials, and manufacturing partnerships, while managing varied international regulations and potential tariff pressures.

AI is helping teams reduce manual effort, improve consistency in how contract terms are interpreted, and make contract intelligence more accessible across functions—supporting faster decision-making while maintaining regulatory rigor.

From Experimentation to Execution

Across healthcare and life sciences, AI in contracting is quickly gaining traction and providing value. The focus is now on practical, scalable adoption that makes contracts more visible, actionable, and operational, empowering teams to deliver improved partner and employee satisfaction.

As complex industry dynamics and cost pressures persist, organizations that successfully embed AI into contract management will be better positioned to manage that complexity—turning contracts into tools for control and resilience rather than sources of friction and risk.

This article is excerpted from the 2026 State of Contracting Report by Icertis. To read the full report, access it here.