HLTH is one of the biggest and flashiest healthcare conferences of the year, so it’s no surprise that 2025’s edition delivered the health AI hype in full force.
But beneath the sheen lurked mounting AI fatigue, fears of formidable new competitors, and a plaguing awareness of an AI bubble.
Healthcare VC is facing many of the same boons, and the same predicaments, as the tech world, albeit hundreds of billions of dollars short. Investors are pouring money into top startups promising enterprise savings, while critics fear those tools won’t pay off as expected. Big Tech companies like Google and Microsoft, as well as new AI juggernauts like OpenAI and Anthropic, are threatening to snap up startup business. And complaints are growing that key markets, like hospital administrative AI, have become oversaturated.
At this year’s HLTH in Las Vegas, those tensions hid under plenty of buoyancy. On the conference floor, companies touting AI agents were ubiquitous. “Your data. Our agents. Real outcomes,” healthcare AI unicorn Innovaccer‘s booth read. Public voice tech company SoundHound suggested I “say hi to our agentic AI agents for healthcare.” Enterprise AI startup Regal’s booth promised a free popsicle to anyone who called its phone number to talk to its voice AI agents.
The show floor also boasted a massive “AI Zone,” complete with an “AI Theater” for startup presentations, distinctions that felt redundant at an event where AI was inescapable.
To some attendees, the sameness was exhausting.
“Everyone is framing themselves as the most generic, enterprise-wide agentic AI solution. It makes me want to vomit,” said one health system executive, who requested anonymity because they weren’t authorized to speak with the media. “I get it, you want to tell this cool story about how many things you can do. But I need to know what your company actually delivers, today, in the real world.”
This year’s HLTH included a massive “AI Zone” with an “AI Theater.”
Michael Vanarey/HLTHinc.
The apparent glut of homogenous startups wasn’t surprising given the amount of capital going to healthcare AI. According to Rock Health, digital health startups raked in $6.4 billion in VC dollars in the first half of 2025, with 62% of that funding going to AI startups.
But incumbent competitors are further complicating that investor optimism. While medical records giant Epic was conspicuously absent from the show floor, its presence loomed large. Epic said in August it planned to sell its own healthcare AI tools, including an AI scribe to compete with Abridge, the $5.3 billion startup that Business Insider reported Epic previously took a stake in — before selling those shares earlier this year.
And, for the first time, an OpenAI executive joined Big Tech giants on HLTH’s main stage. Nate Gross, OpenAI’s new healthcare lead, didn’t share many specifics about the company’s healthcare plans during his panel with Microsoft, Google, and Nvidia on Tuesday; Gross only joined OpenAI in June, and the AI giant’s healthcare product efforts are still early days. But investors and founders are already feeling the heat.
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“In my portfolio, people view OpenAI and Anthropic much more as a threat than people have ever viewed Amazon or Microsoft,” said Blake Wu, a partner at NEA. “I think that’s because OpenAI and Anthropic have just moved a lot faster than Amazon and Microsoft in expanding into every category.”
Agentic giants
At times, HLTH is an oxymoron. The entire conference, from its daytime presentations to evening cocktail hours, takes place in the audacious Venetian Resort. The convention center is connected to a sprawling casino, carrying the faint clink of poker chips and the smell of cigarette smoke into pitch meetings. If gambling’s not your thing, you can always ascend an escalator and ride a gondola in the hotel’s indoor canal. And, as attendees often joke, you can easily spend HLTH’s three-day run without ever seeing the sun.
The show floor, even aside from the AI glitz, is just as ostentatious as the resort. This year, founders and investors could play pickleball at a WeightWatchers court in between booths, pet dogs at a puppy park sponsored by Zelis Healthcare, and take pictures with one of several inflatable or costumed unicorns.
“It’s like the Dreamforce of healthcare,” said Karen Knudsen, the CEO of the Parker Institute for Cancer Immunotherapy.
Mark Cuban posed next to HLTH’s unicorn mascot before his onstage interview Sunday.
michael vanarey/HLTHinc.
AI’s presence in every panel, company booth, and sidebar conversation only added to the feeling of superabundance. Healthcare hasn’t seen the same degree of AI bubble concerns roiling the broader tech ecosystem, seemingly because healthcare VCs haven’t thrown nearly as much capital at industry-specific AI, and have mostly avoided the eye-popping valuation multiples. But VCs haven’t been shy about backing new healthcare AI bets, either.
On Monday, medical AI search startup OpenEvidence announced it had raised $200 million at a $6 billion valuation. It was the biggest raise announced at HLTH, but certainly not the only one. Hyro, the “responsible AI agent platform,” landed $45 million in a funding round led by Healthier Capital, the VC firm helmed by former One Medical CEO Amir Dan Rubin.
Some investors defended healthcare AI’s fundraising boom heartily. Dr. Brenton Fargnoli, a partner at Lightspeed Venture Partners, said during an investor panel Tuesday that he’s seeing some healthcare startups “growing faster than you’ve ever seen before, more efficiently than any company ever before.”
For those AI-first startups, “I think as much capital as possible is very important to grow a business and get as much market share as possible,” said GV general partner Frédérique Dame in the same panel.
But that philosophy worries some other investors, including now that incumbents like medical records giant Epic and AI heavyweights like OpenAI are planning their own healthcare AI plays. Anthropic is pushing further into biotech and pharma — the company released Claude for Life Sciences on Monday — while OpenAI is nodding at potential pushes into consumer health and hospital AI.
As Gross noted on his Tuesday panel, ChatGPT now sees around 800 million active users per week, a customer base unthinkable to any single healthcare company. Consumers, as well as clinicians, are increasingly asking ChatGPT their medical questions. As those users keep coming back to ChatGPT to seek more healthcare information over time, “the real value comes from when you have a longitudinal relationship with that patient or that consumer so that the answers themselves can be improved,” Gross said.
Nate Gross, OpenAI’s new head of healthcare strategy, joined Big Tech peers in a panel about healthcare AI.
michael vanarey/HLTHinc.
Not all hospital stakeholders are sold that OpenAI or Anthropic can win big in healthcare. After all, Big Tech has tried to disrupt the industry many times, with a graveyard of health projects to show for it.
“I’ve seen a lot of really great technologies fail from other industries because they don’t understand how it works in healthcare,” said Mary Beth Navarra-Sirio, vice president of market development at UPMC Enterprises, the innovation and investment arm of the University of Pittsburgh Medical Center. “You could have the best technology in the world, but if you really don’t understand how it needs to support a clinical process, you won’t win in this space.”
Everything is AI
This year’s HLTH attendees made friends by commiserating about the conference’s sheer volume of AI mentions. In a LinkedIn post that by Friday had over 1,600 reactions, healthcare marketing advisor Brett Jansen wrote, “Every booth at HLTH sounds exactly the same. ‘AI-powered platform for healthcare transformation.’ Cool. So is literally everyone else here.”
HLTH’s organizers themselves acknowledged the problem in a panel titled “If Everything is AI, Then Nothing is AI.”
“The AI gold rush has reached its peak, where every startup with a ChatGPT integration is suddenly an ‘AI company’ and every pitch deck is seasoned with enough machine learning buzzwords to make a computer science professor cringe,” the panel description read.
Still, there were plenty of bright spots of AI’s impact in healthcare. Several attendees noted biotech and pharma’s prominent presence at this year’s conference, an event typically dominated by healthtech. AI leaders from GSK, Novartis, and the cancer research center City of Hope told Business Insider in a Tuesday panel that they’re embedding AI across their operations, seeing particular benefits for better, faster research and clinical trial recruitment.
Women’s health led several onstage conversations, a welcome sight for many industry advocates who’ve seen the sector be overlooked time and time again by researchers and investors. New winners in areas like menopause care are leading the charge: JPMorgan digital ads featuring Midi Health CEO Joanna Strober lit up in the conference’s main hallway.
And in an industry where the stakes of AI hallucination are so high, more healthcare organizations are pushing for careful AI development. Spring Health debuted a new benchmark, a set of large language models that evaluate how mental health chatbots handle concerning inputs from patients. The American Heart Association announced an AI assessment lab to validate predictive AI for cardiovascular diseases in partnership with Dandelion Health.
“Smart money is really thinking about startups that are worried about, how do we build this? It’s not about shipping the fastest product anymore, it’s about shipping responsibly,” said Milad Alucozai, cofounder and general partner of Pamir Ventures.
