Health IT funding in Q1: Generative AI, prior authorization 'emerging'

Health IT companies landed $1.3 billion in venture capital funding in the first quarter of 2023, up from the low point of late 2022 but still far off from the booming pandemic years, a new Pitchbook report found.

Here are five other things to know from the May 31 report:

1. The 70 VC deals were in line with the third quarter of 2022 but had a higher value than the first quarter of 2020.

2. Large language models led by GPT-4 will ultimately be "transformative" for healthcare but progress slowly over the next five to 10 years, starting with EHR and clinical documentation summaries and prior authorization request generations. "We heard from one investor that most VCs are spending most of their time working on generative AI," the report noted.

3. The 27 private equity deals were roughly flat compared to the fourth quarter of 2022.

4. Healthcare workforce management platform ShiftKey's $300 million January funding round represented the biggest VC deal.

5. Prior authorization and synthetic data were named "emerging opportunities."

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