Healthcare Payer AI Readiness Starts with a Modern, Secure Data Foundation The combination of legacy systems, fragmented data, and emerging AI applications are pushing payer organizations to modernize technology and operations Healthcare payer organizations stand at an inflection point. As noted in a recent report by PwC, The Future of the Healthcare Payer — Partner for Life, Half the Cost, Twice the Service, today’s insurers must contend with an overwhelming combination of evolving economic pressures, consumer needs, medical advances, and technological innovations like artificial intelligence (AI).1

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HEALTHCARE PAYER AI READINESS STARTS WITH A MODERN, SECURE DATA FOUNDATION

This confluence of factors makes it more challenging for insurers to deliver value to providers and members without modernizing their information technology (IT) infrastructure. Mike Wheatley, Executive Architect at Oracle, agreed. While payers previously were able to manage by layering digital front doors, point solutions, and integrations onto legacy systems, he said, that is no longer sufficient. Health plans need to start looking beyond “outer layers” and finding ways to modernize core platforms if they want to embrace innovative new solutions to improve their operations.

“What’s changing now is that technology is finally catching up to the problem,” he explained. “With advances in cloud and infrastructure, organizations can begin to modernize closer to the core, leveraging environments that can deliver near on-prem performance while providing greater flexibility in how these platforms are managed, evolved, and integrated over time.”

Wheatley joined David Martin, Chief Information Officer at Arkansas Blue Cross Blue Shield, and Kasey Parker, Distinguished Cloud Architect, Multicloud Solutions at Oracle, to discuss the importance of IT modernization in payer operations during the webinar, “From Patchwork to Platform: How Blue Cross Blue Shield Meets the Modernization Challenge.” They highlighted lessons learned from Arkansas Blue Cross Blue Shield’s modernization efforts and shared best practices to help other payer organizations embrace technological changes with strategy and purpose.

Modernizing core systems Current market pressures are forcing payers to reinvent their business models. In the past, Martin noted, health plans mainly focused on adjudicating claims and managing networks. Today, however, they need to support improved patient outcomes and coordinated care journeys through consistent member engagement experiences. Technology leaders in other industries have changed consumer expectations about the way they digitally interact with other businesses, including their health plans. Supporting such interactions, he said, makes interoperability table stakes for payer organizations.

Unfortunately, payers must often rely on legacy systems that get in the way of supporting these more interactive features. And while AI applications offer great promise in helping to enhance both member and provider experiences, gaining access to the data those applications need in a standardized form remains a significant challenge that necessitates modernizing core platforms.

“We believe that to compete in today’s marketplace we need to be in a more agile state,” said Martin. “[Legacy systems] really create an anchor, if you will, to our business…so we’re rapidly modernizing our tech stack and leveraging cloud services so we can meet member and provider needs.”

Organizations can better achieve the agility they seek through modernization efforts — including implementation of AI solutions that support faster prior authorization and claims adjudication, according to Martin. The goal is to have the kind of IT infrastructure that allows an organization to leverage automation, AI, and robotic process automation (RPA) to reduce manual processes and advance strategic activities that will not only offer cost savings to both the company and its members over the long term but improve healthcare outcomes.

With advances in cloud and infrastructure, organizations can begin to modernize closer to the core. ” MIKE WHEATLEY | Executive Architect | Oracle

While AI applications offer great promise to enhance both member and provider experiences, gaining access to the data those applications need in a standardized form necessitates modernizing core platforms.

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HEALTHCARE PAYER AI READINESS STARTS WITH A MODERN, SECURE DATA FOUNDATION

Taking a phased approach Modernizing core systems can be a daunting task. Organizations looking to balance near-term wins with longer-term platform transformation should eschew a big bang strategy — the sudden and massive adoption of new technologies. Many organizations make this mistake, with the combination of expense and risk involved ultimately working against them.

For payers burdened with legacy systems, Martin recommends that their realistic modernization roadmap starts with stabilizing what they already have. Fixing any broken pipelines and unreliable extracts is beneficial, he added. But the most important first step is mapping out a clear picture of all data and where it lives in the greater IT ecosystem.

“Document your core systems, your key data sets, and how data flows between them,” he said.

With that documentation in place, payers can outline a phased approach that emphasizes incremental wins. By focusing on what matters most and addressing specific pain points, organizations will not only prove return on investment but prioritize next steps based on business impact. The panelists also recommended getting executive buy-in for modernization efforts, as well as consistently communicating wins along the way. This helps remind everyone, whether they are a member of the executive team or a junior-level employee, how the new tools and technologies will be valuable to the organization.

Data unification for AI readiness Successful data unification is at the heart of technology modernization efforts. While this is challenging to achieve, payers can set up their platforms to organize fragmented data so that it behaves as if it were unified.

We need to be better at bringing the AI to the data. [And in healthcare, it’s about] being able to protect that information…so that only the right people are seeing the right data.” KASEY PARKER | Distinguished Cloud Architect, Multicloud Solutions | Oracle

“Payers need to focus on logical data unification by building a governed access layer and standardizing core entities like member and claims data,” said Martin. Even if data is physically distributed across the mainframe or in the cloud, enabling real-time data flow ensures that it operates and looks like it comes from a single source.

A major goal for most payers in achieving this level of data unification is making the organization “AI ready.” While there is not an agreed global definition for that term, Parker explained that organizations must develop a secure infrastructure that can leave data in place and enable role- based access control for users. “We need to be better at bringing the AI to the data,” he said. “[And in healthcare, it’s about] being able to protect that information…so that only the right people are seeing the right data.”

In a payer environment, AI-ready data is not simply data that can be accessed by a model. It must be timely, governed, traceable, secure, standardized, and fit for the specific use case. Organizations need consistent definitions for critical entities such as member, provider, claim, benefit, and authorization; clear lineage from source systems to AI outputs; role- or policy-based access controls; and quality metrics that can be monitored over time.

It’s a fundamentally different approach to data management — and one that can provide more value from AI solutions, according to Wheatley. But getting there is not possible unless organizations have the platforms to appropriately standardize data and make it ready for use, strong data governance, and an ownership strategy.

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HEALTHCARE PAYER AI READINESS STARTS WITH A MODERN, SECURE DATA FOUNDATION

Reference 1. PwC. 2026. The future of the healthcare payer — Partner for life, half the cost, twice the service.

https://www.pwc.com/us/en/industries/health-industries/library/assets/future-of-payer.pdf.

Selecting the right modernization environment Payer organizations can no longer rely on patchwork fixes. As they look to modernize, they should work with trusted partners that understand their specific needs and what they hope to achieve with new platform investments. Such partnerships can guide an incremental approach to modernization to improve data quality and governance. They will also support the move away from legacy systems to more flexible multicloud environments with specialized services and enhanced security. Both will help health plans not only better manage data flow, but, as Martin said, “put workloads where they fit best.”

For payers, multicloud should not mean adding more complexity. The value comes from placing data services, applications, analytics, and AI capabilities where they best support performance, security, governance, and operational needs. Oracle’s multicloud approach gives organizations access to Oracle data services in the cloud environments they already use, helping combine Oracle AI Database capabilities with hyperscaler-native application, analytics, and AI services. This can reduce re-architecture, lower latency between applications and data, and allow critical data platforms to modernize without forcing a disruptive migration to a new cloud operating model.

About Oracle Oracle offers integrated suites of applications plus secure, autonomous infrastructure in the Oracle Cloud. For more information about Oracle (NYSE: ORCL), please visit us at oracle.com.

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Payers need to focus on logical data unification by building a governed access layer and standardizing core entities like member and claims data.” DAVID MARTIN | Chief Information Officer | Arkansas Blue Cross Blue Shield

At the same time, payer organizations need clear guardrails for AI-enabled workflows. For use cases that affect member care, claims decisions, prior authorization, or member guidance, human oversight, explainability, access controls, and documented lineage are essential to maintain trust and reduce risk.

“[AI] will reduce all the manual activity that happens behind the scenes. It’s going to make our employees more efficient. It’s going to help us deliver a better member experience through self-service capabilities,” Martin said. “There’s more to come as AI matures…and we’re embracing it and making heavy investments in that space so our members can get the best care possible.”

https://www.himss.org https://www.pwc.com/us/en/industries/health-industries/library/assets/future-of-payer.pdf https://www.oracle.com/ https://www.oracle.com/database/