You are correct, AI (which is basically a neural network, and thus really just a glorified classifier) is superbly good at classification and if you want to classify what a condition is and how it connects to other conditions, then classifiers are by far the fastest and most reliable way to do this. You've said as much yourself, and I absolutely agree with you on every detail of what you've said about AI.
A lot of my private research into AI is to push it to the absolute limits and see where it fails. It fails in some fascinating ways, too. So, yeah, I also agree with your conclusion. It is really good in some areas and completely bad/potentially damaging in others. My personal efforts are centred around trying to parameterise exactly where that line is, but ultimately I think we're both absolutely agreed there is a line and we need to know where it is.
Providers have fatigue because they're overworked - in terms of caseload, in terms of cognitive effort per case that's needed, and in terms of how long their shifts end up being. You're right that AI could have reduced the caseload and cognitive effort, but you're right in what you say about the medical services needing more staff and shorter hours per staff member, and that it's an entirely legal failure cascade.
It's not clear to me how to fix the law (analysis suggests politician skulls are made of some sort of dwarf star alloy that seems to occupy most of the head region). I've generaly filed politics under Social Quantum Mechanics (you can either see the solution or create policy, but never both at the same time).