Orthopedic revenue cycle management (RCM) is entering a historic turning point. For years, practices have tried to keep pace with rising administrative pressure by hiring more people, adding more software, or building more internal workarounds. But those strategies are now hitting hard limits.
The labor pool has shrunk. Administrative complexity has exploded. Payer requirements have become more technical, more portal-driven, and more dependent on consistent documentation than ever before. The gap between what orthopedic RCM needs and what human teams can reliably support is widening every quarter.
That’s why 2026–2027 is emerging as the first real inflection point in healthcare where automation moves from “experimental” to “expected” — not as a bolt-on tool, but as a foundational layer of the revenue cycle.
This article explores what orthopedic RCM will look like by 2027, what will be largely automated end-to-end, and why the most successful practices will be those that start building their automation foundation now rather than later.
And unlike the previous article, this one focuses not on workflows today, but on what the next 18–24 months will realistically transform in orthopedic RCM.
1. Prior Authorization Submission Will Be 70–90% Automated
For years, prior auth has been the most painful part of orthopedic operations. But by 2027, most of the heavy lifting in prior auth submissions won’t be done by humans.
Automation is taking over because prior auth is:
predictable
rules-based
documentation-driven
portal-dependent
high-volume
high-cost when errors happen
The last decade has shown us that tasks with these characteristics are the ones AI handles most effectively.
By 2027, the majority of prior auth submissions in orthopedics will likely be automated:
pulling required clinical notes
validating conservative therapy
assembling PA packets
logging into payer portals
completing multi-step submission flows
updating the EHR or tracking system
scheduling follow-up checks
escalating incomplete approvals
Humans won’t disappear from the process — but they’ll focus primarily on clinical exceptions, escalations, and ambiguous cases.
This is already happening today with Magical’s agentic AI employees, which complete entire multi-step PA workflows without requiring integrations or IT support.
2. Real-Time Eligibility Verification Will Run Without Staff Involvement
Eligibility work today is tedious, manual, and error-prone — not because it’s complex, but because it’s repetitive.
By 2027, it will be fully automated for most encounters.
Eligibility lends itself to automation because it has:
clear rules
known data fields
predictable variations
immediate downstream impact
The constraints — like complex MSK benefits, PT caps, and secondary insurance detection — are exactly the kinds of nuances automation can capture consistently when trained correctly.
Expect RCM teams to shift from “verifying eligibility” to “managing exceptions.”
3. Denial Prevention, Not Denial Management, Will Be the Standard
By 2027, orthopedic RCM teams will spend far less time chasing denials. Instead, AI systems will prevent many of the most common ones before they ever occur.
AI-powered systems will pre-check for:
missing documentation
incorrect CPT bundles
facility mismatches
invalid NPI/TIN combinations
expired authorizations
missing medical necessity elements
incorrect modifiers
plan-based quirks that cause automatic denials today
This shift from fixing mistakes to preventing mistakes will fundamentally reshape the economics of orthopedics.
RCM leaders today still assume denials are inevitable. By 2027, the narrative will shift to:
“Why did this denial happen? That’s unusual.”
4. Surgical Case Readiness Checks Will Be Automated End-to-End
A common operational challenge today is confirming whether a surgical case is “clean” — fully authorized, fully documented, and free of hidden issues that could derail or delay payment.
In 2027, most of this readiness work will be automated.
AI employees will check:
all CPTs in the surgical bundle
corresponding authorizations
documentation completeness
imaging requirements
PT/OT timelines
facility requirements
payer-specific coverage nuances
Instead of people piecing together readiness across multiple systems, AI will serve as a centralized logic layer ensuring every surgical case is financially sound before it reaches the OR.
This is a subtle but transformative change. It means fewer surprises, fewer cancellations, and more predictable cash flow.
5. Coding Prep and Charge Accuracy Will Be Largely Automated
Note: this is NOT full autonomous coding — which will still require human judgment for surgical complexity, fracture patterns, revisions, etc.
But several parts of the coding workflow will be automated:
gathering documentation
verifying imaging
matching clinical notes to supporting documents
flagging missing details
catching inconsistencies in operative reports
suggesting appropriate add-on codes
Humans will still decide final codes, but the machine will prepare and validate upstream details — reducing the time coders spend on busywork and improving accuracy.
Coders will become validators, not document chasers.
6. Underpayment Detection and Payer Variance Monitoring Will Be AI-Driven
Underpayment detection has traditionally been reactive and often unnoticed. By 2027, it will be automatic.
AI systems will continuously monitor:
contractually expected rates
actual payments
payer-specific variance patterns
systematic underpayments
misapplied adjustments
delayed secondaries
And rather than issuing static reports, the system will open tasks, push alerts, and initiate next steps automatically.
This will fundamentally shift payer strategy for orthopedic practices. Instead of discovering underpayments months later, practices will see them as they occur.
7. 24/7 Queue Monitoring Will Replace “Batch Work” Across RCM
Orthopedic RCM still operates in batches — humans work cases during business hours, then “catch up” later.
By 2027, most workflows will run continuously:
statuses get checked overnight
claims get validated in real time
documentation gets assembled automatically
EOBs get categorized instantly
portal updates get logged as soon as they happen
This real-time approach eliminates the delays that currently cause case backlogs, aging AR, and operational chaos.
Magical already runs workflows 24/7 for practices today, which is part of why early adopters will be best positioned for full-scale automation in 2027.
3 Big Shifts That Will Redefine Ortho RCM by 2027
The future isn’t just about automating individual workflows. It’s about a systemic shift in how the entire revenue cycle functions.
Here are the broader transformations coming into focus.
Shift #1: From “Human First” to “AI First” Operational Design
Orthopedic RCM is still designed around humans:
humans search for documents
humans fill out forms
humans check portals
humans track deadlines
humans correct mistakes
By 2027, RCM workflows will be redesigned so that the default executor is an AI employee, and humans handle what machines can’t:
clinical nuance
escalations
exceptions
communication
judgment
This fundamentally transforms staffing models, job roles, and throughput.
Shift #2: From Reactive Management to Proactive Revenue Protection
In 2027, orthopedic executives will stop thinking in terms of:
“How do we fix denials?”
“How do we catch missed steps?”
“How do we reduce rework?”
Instead, leaders will ask:
“Why did anything get missed at all?”
“Why did this case fall out of compliance?”
“Why wasn’t this prevented?”
Because the system itself will be monitoring every step — preventing predictable errors long before revenue is at risk.
Shift #3: RCM Teams Will Shrink — and Become Significantly More Strategic
Automation does not eliminate humans.
It elevates them.
By 2027, the people who stay in RCM will:
manage exceptions, not volume
oversee automation, not portals
handle complex clinical reviews
negotiate with payers
serve as architects of operational design
Their work will be more analytical, more strategic, and more valuable — because the repetitive tasks will no longer dominate their day.
So What Should Ortho Practices Do in 2026 to Prepare?
Practices that wait until 2027 will be at a disadvantage. The early movers in 2026 will have smoother transitions, better-trained staff, and AI that has learned their unique workflows.
The best preparation steps include:
mapping your highest-friction workflows
eliminating variation and standardizing steps
starting with one or two AI-driven workflows
freeing up staff from the most repetitive tasks
building automation “muscle memory”
preparing leadership for a new operating model
Every practice’s journey will be different, but the destination is clear: a hybrid workforce where AI handles the volume and humans handle the nuance.
Orthopedic practices that embrace automation early will see:
fewer delays
fewer denials
faster revenue
lower administrative cost
stronger patient and surgeon satisfaction
Those that don’t will feel increasingly stretched — and increasingly outpaced — by the ones that do.