{"id":146711,"date":"2026-04-26T20:39:26","date_gmt":"2026-04-27T00:39:26","guid":{"rendered":"https:\/\/medcitynews.com\/?p=146711"},"modified":"2026-04-27T02:04:44","modified_gmt":"2026-04-27T06:04:44","slug":"hospital-finance-costs-ai","status":"publish","type":"post","link":"https:\/\/medcitynews.com\/2026\/04\/hospital-finance-costs-ai\/","title":{"rendered":"Why Some Hospitals Are Betting on Midstream Health to Help Eliminate Waste"},"content":{"rendered":"\n

There are plenty of AI startups on the market promising to bolster hospitals\u2019 finances by increasing revenue. But that\u2019s not the case for San Francisco-based Midstream Health<\/a>.<\/p>\n\n\n\n

For most health systems, the key to unlocking dollars isn\u2019t boosting revenue \u2014 it’s decreasing costs, said Venkat Mocherla, Midstream\u2019s co-founder and president.<\/p>\n\n\n\n

Midstream, founded in 2023, uses AI to clean up and unify hospitals\u2019 fragmented financial and operational data, which helps leaders spot savings opportunities and make smarter purchasing decisions, he explained. For instance, the platform could help surface insights that help a hospital capture missed rebates or avoid overpaying for supplies and devices.<\/p>\n\n\n\n

\u201cNine out of 10 AI companies are revenue cycle [management] companies. We are not an RCM AI business. We think about all the waste that is created outside of the revenue cycle \u2014 we believe that American healthcare fundamentally has a cost transformation challenge, not a revenue one,\u201d Mocherla stated.<\/p>\n\n\n\n

Hospitals often pay different prices for the same items internally, struggle to collect rebates and lack visibility into off-contract purchasing \u2014 all areas Midstream targets, he said.<\/p>\n\n\n\n

The company\u2019s platform is being used across health systems including Mount Sinai<\/a>, CommonSpirit<\/a> and Houston Methodist<\/a>. Midstream primarily makes money by taking a cut of the savings it generates, which Mocherla noted aligns the startup\u2019s incentives directly with hospitals\u2019 financial outcomes.<\/p>\n\n\n\n

\u201cWe get to make money when our health system partners save money,\u201d he declared. <\/p>\n\n\n\n

Not only does Midstream promise its customers a strong ROI, Mocherla noted it also promises \u201cROE\u201d \u2014 return on effort. This means hospitals will start to see savings as a result of their deployment within the first four months, he said.<\/p>\n\n\n\n

At Mount Sinai, this quickness was what ultimately drove the decision to adopt the platform, according to CFO Vincent Tammaro. He said his organization was initially introduced to Midstream via an overview of their AI-powered rebate optimization platform. <\/p>\n\n\n\n

\u201cMidstream already had this platform in production generating value in other large healthcare systems where they had implemented the technology on a very rapid timeline. The feedback we received from references confirmed Midstream was able to provide \u2018speed to value\u2019 for a very practical supply chain AI use case, which was an important consideration in our decision,\u201d Tammaro stated.<\/p>\n\n\n\n

In addition to optimizing its rebate earning potential, Midstream\u2019s platform also helps Mount Sinai upgrade contract terms and conditions, verify contract price improvements, and identify and correct invoice discrepancies, he added.

As hospitals continue to face mounting financial pressures<\/a>, tools that target realistic cost control might start to resonate more than those focused on quixotic revenue growth. Midstream is betting on that, at least \u2014 and its customers say the company can deliver fast, tangible savings.<\/p>\n\n\n\n

Photo: Eugene Mymrin, Getty Images<\/em><\/p>\n","protected":false},"excerpt":{"rendered":"

Midstream Health is taking a bit of a different approach to healthcare AI by focusing on reducing hospitals\u2019 costs rather than boosting their revenue. The startup uses AI to identify savings opportunities across fragmented spending data, which helps health systems like Mount Sinai and CommonSpirit quickly improve their purchasing decisions.<\/p>\n","protected":false},"author":31620,"featured_media":146712,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"om_disable_all_campaigns":false,"featured_image_focal_point":[],"homepage_placement":"top","homepage_placements":{"top":true,"featured":true,"sidebar":false},"homepage_alternative_layout":false,"featured_categories":[48,60,117,105],"hide_from_feed":false,"footnotes":""},"categories":[105,117,48,51659,60],"tags":[35892,44258,9243,44026,45290,53590,30630,45624,42473],"class_list":["post-146711","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-artificial-intelligence","category-health-tech","category-hospitals-channel","category-providers","category-startup-channel","tag-ai","tag-ai-in-healthcare","tag-artificial-intelligence","tag-artificial-intelligence-in-healthcare","tag-cost-savings","tag-midstream-health","tag-mount-sinai","tag-mount-sinai-health-system","tag-rebates"],"acf":[],"yoast_head":"\nWhy Some Hospitals Are Betting on Midstream Health to Help Eliminate Waste - MedCity News<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/medcitynews.com\/2026\/04\/hospital-finance-costs-ai\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Why Some Hospitals Are Betting on Midstream Health to Help Eliminate Waste - MedCity News\" \/>\n<meta property=\"og:description\" content=\"Midstream Health is taking a bit of a different approach to healthcare AI by focusing on reducing hospitals\u2019 costs rather than boosting their revenue. 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