Medical Hallucinations in Foundation Models and Their Impact on Healthcare
Medical foundation models may generate “hallucinations”—factual, logical, or evidence-inconsistent errors—that jeopardize clinical decision-making and patient safety. To address this, we first propose a multidimensional taxonomy of medical hallucinations and establish a real-world, clinician-annotated benchmark dataset derived from authentic clinical cases; we further validate its clinical impact via an international physician survey. Methodologically, we integrate expert annotation, empirical behavioral surveys, and large language model (LLM) evaluation to systematically assess the efficacy of chain-of-thought (CoT) reasoning and retrieval-augmented generation (RAG) in mitigating hallucinations. Results show both techniques significantly reduce hallucination rates, yet residual hallucinations remain clinically hazardous. Building on these findings, we introduce a patient-safety-centered AI governance and ethics framework, offering theoretical foundations and actionable pathways for responsible deployment of medical AI. (149 words)