By Rachel Blum, VP, Emerging Markets and Partners, Verato
LinkedIn: Rachel Blum
LinkedIn: Verato
Health tech companies are investing aggressively in three directions right now: connected care experiences, cross-platform growth, and AI. Each represents a significant commitment of capital and engineering resources, and each is reshaping how these organizations compete. But all three share a dependency that most companies don’t treat as strategic, and often don’t recognize at all, until it starts breaking things. That dependency is identity, the ability to know, reliably and consistently, “who is who” across every system and interaction.
The problem is that identity doesn’t fail all at once. It fails in stages, and each stage makes the next one worse.
Where It Breaks First
The first instance of identity failure is in the care experience itself. A patient isn’t recognized across touchpoints. A referral arrives without context because two systems can’t agree on who the person is. Engagement feels disjointed because the organization doesn’t have a complete, unified understanding of the individual at each moment of care.
In an industry where primary care is now considered ground zero for the rise in healthcare consumerism, a broken experience is a reason to leave, and patients do. Nearly half of patients who switch primary care providers do so voluntarily, and the leading reasons are the experience itself: feeling rushed, not being listened to, or sensing a lack of empathy from the provider or staff. That switching can reduce a provider organization’s revenue by as much as 10%. When patients can just as easily walk into a retail clinic or open a telehealth app, the cost of a bad experience is an exit.
Then It Stalls Growth
Health tech companies scale by adding products, onboarding new customers, expanding provider networks, and integrating acquisitions. Each of those moves compounds the identity problem. Every new integration multiplies fragmented records. Duplicates grow and onboarding slows. Revenue attribution breaks because the data can’t connect a person reliably across platforms.
Federal law prevents the creation of a centralized government healthcare ID, which means no universal identifier exists by design. Each new system or acquisition means solving the same matching problem again, independently, with incomplete tools. 57% of hospitals report barriers to receiving and integrating patient data, and identity is frequently at the root.
Health tech companies don’t build their own cloud computing layers. They rely on AWS, GCP, and Azure. They don’t build insight engines from scratch. They use Snowflake or Databricks. Identity belongs in the same category, specialized enough that building it internally rarely pays off, and foundational enough that getting it wrong undermines everything built on top. Yet many organizations still try to maintain their own matching logic, pulling engineering resources away from the products that differentiate the business.
And AI Can’t Deliver
Health tech companies are investing heavily in AI-driven personalization and predictive analytics. All of it depends on identity data that’s unified and well-governed. AI models absorb the data they’re trained on, and when that data contains duplicate records and mis-linked identities, the models scale those errors. A patient gets flagged for a condition they don’t have. An engagement campaign reaches the wrong household. At the volume health tech companies operate, these failures compound quickly and erode the trust clinicians and end users need before adopting new tools.
Companies pouring resources into AI without first solving identity are increasing cost and risk. Manual data stewardship piles up. Integration with cloud and analytics platforms stalls because the data feeding them can’t be trusted.
The investment in AI starts to deliver only when the identity foundation underneath it is solid.
The Invisible Dependency
Identity isn’t the kind of infrastructure anyone celebrates. When it works, experiences connect and growth compounds. AI delivers what it promises. When identity doesn’t, every strategic bet underperforms and nobody can pinpoint why.
The organizations that get this right won’t notice it, like walking through rain with a good umbrella. The ones who don’t will keep getting wet and wondering why.