At this year’s Healthcare IT Connect Summit (HIT Connect), state healthcare leaders, technology vendors, and policy experts tackled a shared challenge: how to modernize complex health systems without disrupting the reliable services communities depend on. The stakes are high. And with the changes required by H.R.1, the pace of change is accelerating.
For organizations working alongside state Medicaid agencies, discussions at HIT Connect highlighted several priorities shaping the next phase of healthcare system transformation.
Key Insights from Healthcare IT Connect
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Independent User Acceptance Testing (UAT) and End to End (E2E) testing capabilities are now critical as state health systems operate across complex multi-vendor environments
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Rural health transformation initiatives are accelerating through targeted funding, EHR access and modernization, and telemedicine expansion
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Procurement reform is enabling faster adoption of health IT solutions through APD waivers, agile oversight models, and outcome-based contracting focusing on statements of needs
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Artificial intelligence is shifting from experimentation toward governance, scaling, and targeted operational use cases
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Interoperability and standardized data underpin everything else, from EHR modernization and AI applications to verification systems and connected care delivery
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Automation is helping agencies reduce administrative burden, improve accuracy, and respond to staffing shortages
Managing complexity in multi-vendor healthcare ecosystems
One of the most consistent themes across the conference was the growing complexity of state health technology environments. Many systems now involve multiple vendors delivering specialized components across eligibility systems, Medicaid Enterprise System (MES) platforms, data environments, and digital services.
North Highland’s Uma Kandasamy led a panel with leaders from the Massachusetts Executive Office of Health and Human Services and the New Mexico Health Care Authority on how independent User Acceptance Testing (UAT) helps states manage this complexity across large, multi-vendor health systems. The panel explored challenges, strategies, and lessons learned from E2E UAT testing in a complex MES ecosystem where 7+ vendors supported different system components, with business processes spanning multiple modules across 20+ partner organizations.
Early user involvement, cross-vendor coordination, and structured testing approaches help teams identify issues earlier in the implementation process and support more stable system delivery.
Rural healthcare modernization gains momentum
Rural healthcare transformation was another major focus of discussion. Several states are investing in modernization programs designed to strengthen healthcare infrastructure and improve care access in underserved communities.
Dedicated funding streams, including rural health technology catalyst programs, are supporting these efforts. States are also exploring statewide electronic health record (EHR) platforms and expanded telemedicine services as part of broader rural health strategies.
Leaders emphasized that while technology infrastructure is expanding, adoption and operational planning remain critical to ensuring these investments translate into improved care delivery.
Procurement reform is enabling faster technology adoption
State leaders also discussed how procurement processes are evolving to support faster modernization. Traditional procurement structures often require highly prescriptive requirements that can slow implementation timelines.
Federal and state initiatives are introducing greater flexibility. Discussions highlighted the use of Advanced Planning Document waivers to accelerate project timelines and the Agile Oversight Implementation Pilot Program, which supports more adaptive project management approaches.
Many states are also shifting from detailed Statements of Work toward Statements of Objectives that emphasize outcomes rather than prescriptive technical requirements.
States are demanding procurement vehicles that enable speed without sacrificing accountability. Cooperative contracts are increasingly viewed as pathways to expedited, compliant technology acquisition.
Artificial intelligence moves toward structured adoption
Artificial intelligence is increasingly part of healthcare modernization discussions. While some agencies have begun implementing AI capabilities, many are still establishing governance frameworks to guide responsible adoption.
One area receiving attention is the use of agentic AI within call centers to improve citizen services and help manage high-volume inquiries. However, maturity levels vary significantly across states, and many agencies are still determining how to structure governance and oversight for these technologies.
Interoperability remains foundational for modernization
Across multiple sessions, interoperability and data standards were consistently identified as foundational requirements for modernization initiatives.
Fast Healthcare Interoperability Resources (FHIR) standards support data exchange across healthcare systems and enable several priorities discussed. This includes EHR modernization, AI implementation, verification and compliance systems, and broader integration across state healthcare programs.
Automation helps agencies address workforce and operational demands
Workforce constraints were frequently raised by state leaders as agencies manage growing program complexity. Automation is increasingly being used to reduce administrative burden while helping agencies maintain program accuracy and compliance.
Use cases included automated verification tools that confirm income and education information for many applicants, as well as communication tools designed to notify citizens before eligibility lapses occur.
These capabilities help agencies manage workload pressures while improving program integrity.
What this means for state healthcare leaders
The discussions at HIT Connect reflect a healthcare IT landscape undergoing rapid change. States are modernizing technology systems, refining procurement strategies, and exploring new capabilities such as artificial intelligence and automation.
As modernization continues, strong testing practices, interoperable data, and coordinated oversight across vendors will remain essential to delivering reliable and effective healthcare services.
Modernizing healthcare systems requires the right combination of talent and technology. If you’re exploring how these trends may impact your programs, platforms, or transformation priorities, let’s talk.
