Mount Sinai Applies AI to Uncover Hidden Costs in Supply Chain
Midstream system scans contracts and payments to surface savings opportunities
Mount Sinai Health System announced it is working with Midstream Health to implement an AI platform aimed at identifying cost savings and capturing missed payments within its supply chain operations. The system will be applied to an area where annual spending exceeds $1 billion.
The platform is designed to surface missed rebates, pricing discrepancies, and underpayments that can occur across complex supplier and contract structures. Mount Sinai said the effort is expected to generate a fivefold return on investment by capturing funds that would otherwise go uncollected.
“Mount Sinai purchases and tracks supplies, equipment, and services well in excess of $1 billion a year to provide seamless patient care and advance medicine, research, and education,” said Vincent Tammaro, executive vice president and chief financial officer. “Receiving the full contract value of our rebates is an important component of managing supply expenses and mitigating the impact of rising inflation that contributes to health care unaffordability for our patients and communities.”
Midstream’s platform consolidates financial, contract, and operational data into a single dataset, allowing AI systems trained on healthcare finance workflows to analyze transactions and flag issues. These systems prioritize actions tied to rebate gaps, pricing inconsistencies, delayed payments, and denied claims.
Healthcare financial data is often spread across contract systems, supplier records, and billing platforms, which makes it difficult to verify whether agreed pricing terms are fully realized. This fragmentation can leave rebate gaps and pricing discrepancies undetected without continuous monitoring.
Mount Sinai said the system will allow teams to model outcomes, retrieve supporting records, and monitor financial performance on an ongoing basis rather than through periodic reviews. This approach replaces retrospective audits with ongoing analysis tied to live operational data.
“Mount Sinai continues to leverage data assets in a more meaningful way to help drive thoughtful insights and better understanding of how we perform operationally, clinically, financially, and in support of our mission to optimize patient care, services, and performance,” said Lisa Stump, executive vice president and chief digital information officer.
The collaboration comes as health systems face sustained cost pressures tied to supply expenses and reimbursement constraints, increasing focus on capturing existing revenue tied to contracts rather than reducing services.
Venkat Mocherla, co-founder and president of Midstream Health, said the platform is built to move beyond analysis to execution. “Focused on rapid value generation, this collaboration is a great example of how agentic AI can go beyond providing insights, accelerating time to savings and advancing financial sustainability to help address the health care affordability crisis.”