Healthcare IT market set to reach $228.8bn by 2020
New market research by MarketsandMarkets, estimates that the Healthcare IT Market will reach $22.8bn by 2020, growing at a compound annual growth rate (CAGR) of 13.4% during 2015 to 2020. The report provides a detailed market analysis of various current healthcare IT solutions, such as mHealth, EHR and﻿ Telehealth. The report suggests that a lack of in-house IT domain knowledge and reluctance among end users to adopt new healthcare services, will impact the overall growth of the healthcare IT market﻿ to a certain extent over the next 5 years.

Updated on : March 15, 2023

The global healthcare IT market worth $974.5 billion by 2027, growing at a CAGR of 19.8% in the upcoming years.

The new edition of the report provides updated financial information until 2022 for each listed company in a single diagram (instead of multiple tables). This will easily help analyze the present status of profiled companies in terms of their financial strength, profitability, key revenue-generating regions or countries, business segment focus in terms of the highest revenue-generating segments, and R&D investments. The growth of the market is driven by the growing adoption of e-prescribing, telehealth, mHealth, and other HCIT solutions. However, interoperability issues and security concerns are challenging the growth of the global market to a certain extent.

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Healthcare IT Market Dynamics

Drivers: growing adoption of e-prescribing, telehealth, mHealth, and other HCIT solutions.

The pandemic has resulted in a significant increase in the burden on healthcare organisations across the globe. Healthcare facilities face immense pressure to create a well-coordinated environment where all clinical devices are connected internally and the organisation operates in coordination with other healthcare units. According to Worldometer, there were around 650 million confirmed COVID-19 cases and 66 million deaths globally as of December 5, 2022. Considering the high and growing number of cases, the healthcare systems of several countries are facing a major shortage of hospital beds, healthcare providers, and basic medical equipment. This is compelling hospitals and other care facilities to deploy capacity management solutions to track COVID-19 patients and monitor and manage disease progression.

According to a Surescripts 2020 National Progress Report, during the COVID-19 pandemic, healthcare providers increased interoperability tool adoption to boost healthcare management, price transparency, and specialty medications. The total number of ePrescriptions exceeded 1 million prescribers for the first time when Surescripts added 63,000 prescribers and 1.91 billion ePrescriptions in 2020. The number of ePrescriptions for controlled substances increased by 52%, from 134.2 million in 2019 to 203.6 million in 2020. COVID-19 sparked the advance of virtual healthcare, sparking a 72.5% increase in electronic prescriptions written through telehealth during the first month of COVID-19.

Electronic prior authorizations increased by 43.2%, and 7.6% more prescribers now use electronic prior authorization. Over 413,000 prescribers leveraged real-time prescription benefit tools, and prescribers saw 240 million benefit responses. This was a 75.4% increase since 2019. The quantity of clinical direct messaging transaction exchanges saw a 50% increase from 52.8 million in 2019 to 79.4 million in 2020. The number of individuals and healthcare organisations leveraging the platform rose 15% from 648,500 in 2019 to 745,200 in 2020.

As COVID-19 is highly contagious, the need for remote monitoring of affected patients is increasing. Temporary hospitals are being set up in several countries to deal with the increasing disease incidence. However, they lack the basic infrastructure to facilitate communication between nurses and patients. Consequently, the spread of COVID-19 has greatly boosted the demand for hospital capacity management solutions, telehealth and mHealth solutions, e-prescribing, and EHR solutions.

Restraints: IT infrastructure constraints in developing countries

Emerging countries experience a shortage of skilled IT personnel that impacts the adoption and usage of HCIT solutions in these countries. Furthermore, cost issues are one of the major obstacles to the adoption of HCIT solutions. The maintenance and software costs of these solutions are greater than the cost of the software. Additionally, software upgrades, per changing user requirements, represent a recurring expenditure amounting to almost 30% of the total cost of ownership. The aforementioned factors limit market growth in emerging countries to some extent.

Furthermore, the organisational impacts and benefits of HCIT are often intangible, and their realisation may take longer. The implementation cost of HCIT solutions in the healthcare systems of emerging economies is even higher, as they require capital to build the infrastructure needed for implementing HCIT solutions. Therefore, hospitals often prefer investing in the core technologies directly linked to patient care quality rather than in allied departments. Thus, the high cost of deployment and maintenance restricts smaller healthcare organisations from investing in HCIT solutions, especially in emerging markets across APAC and Latin America.

Opportunities: Rising use of healthcare IT solutions in outpatient care facilities

In response to the rising pressures on health systems to lower the cost of care, the industry is shifting toward outpatient settings to reduce care costs. An outpatient surgery centre procedure is estimated to cost 30% to 60% less than an inpatient hospital setting. In addition, convenience is another important factor driving the rise of ambulatory care. With the increase in outpatient settings and patient influx, the demand for and usage of HCIT solutions in outpatient settings will increase.

According to a survey sponsored by United Health (US), around 10% of US hospitals had dedicated HCIT clinical documentation improvement programmes for their outpatient settings. An additional 10% is planned to implement these services in the next six months. Furthermore, 14% of hospitals planned to implement advanced solutions in the near future. This trend is expected to drive the use of HCIT solutions, such as RCM solutions, in outpatient settings in the coming years.

In addition, due to the benefits of HCIT solutions, various federal bodies also support deploying these solutions in outpatient care settings. For instance, in June 2021, the US government invested USD 80 million in creating a new public health informatics and technology program. This has boosted the adoption of HCIT solutions among stakeholders in outpatient care facilities to deliver better health services and help enhance patient outcomes. Furthermore, with the benefits of web-based management for constant care, many patients are now moving towards outpatient care needs.

Challenges: Interoperability issues

Although healthcare providers are making great progress toward coordinated value-based care, interoperability among information systems remains challenging for implementing HCIT solutions. The healthcare industry is highly information-intensive, where patient information is generated in all departments at all points of care within a healthcare organization. However, the usability of this information is very low if it is not integrated properly to create an exhaustive and accurate patient record. Since many HCIT tools are being used within healthcare systems, there is a greater need to integrate IT systems to aid accurate decision-making by healthcare professionals at different points of care delivery. Moreover, the lack of interoperability among health organisations with a regional or national health IT platform for exchanging data hinders the full exploitation of HCIT solutions.

The increasing proliferation of new medical apps and health information exchange solutions from consumer technology companies presents difficulties in integrating the older available solutions. Many healthcare organisations have already invested in various information management systems and medical devices from different vendors, each with their own makes and models. As healthcare organisations increasingly adopt various HCIT systems, there is a greater need to integrate different information technology systems into an organisations IT architecture to ensure optimal utilization. As a result, the successful integration of HCIT systems with other systems is a major area of focus for IT infrastructure development projects.

However, integrating new HCIT systems with a healthcare organization's legacy information management system is daunting for market players. With differences in data communication standards, many information systems cannot exchange data. This is limiting the successful utilisation of HCIT systems by healthcare organizations, thereby lowering their adoption.

Healthcare provider solutions will register the highest growth in the product and service segment of the healthcare IT market.

On the basis of product and service, the healthcare provider solutions segment will register the highest growth. The high growth of this segment can be attributed to government initiatives to improve the quality of patient care and the need to improve the efficiency of healthcare services. The healthcare provider solutions segment is further divided into clinical and non-clinical HCIT solutions. The market for the clinical solutions segment is growing owing to the rising demand for improved patient safety and patient care, stringent regulations regarding healthcare provider solutions, and the need for integrated healthcare systems.

Healthcare providers will be the largest end user segment among healthcare providers in the healthcare IT market.

Based on end users, the healthcare providers segment accounted for the largest share in the global market during the forecast period. Factors such as stringent government regulations and the need to improve patient care while increasing operational efficiency account for this share. The increasing number of patients, hospitals, and ambulatory care centres and the strong purchasing power of hospitals are also driving the growth of this end-user segment.

North America accounted for the largest share of the healthcare IT market during the forecast period.

In 2021, North America accounted for the largest share of healthcare IT, followed by Europe, Asia Pacific, Latin America, and the Middle East and Africa. The large share of North America can be attributed to the large adoption of healthcare IT solutions in the region, stringent regulations regarding healthcare quality, and the increasing need to curtail the escalating healthcare costs through healthcare IT solutions.

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The healthcare IT market is dominated by a few globally established players such as Optum (US), Cerner Corporation (US), Cognizant (US), Change Healthcare (US), Philips (US), Epic Systems Corporation (US), Dell Technologies (US), Allscripts (US), athenahealth (US), GE Healthcare (US), Oracle Corporation (US), Wipro (India), IBM(US), eClinicalWorks (US), Infor Systems (US), Conduent (US), Conifer (US), Nuance (US), 3M (US), SAS (US), Carestream Health (US), Inovalon (US), Practice Fusion, Inc. (US), InterSystems (US), and Tata Consultancy Services (India).

Healthcare IT Market Report Scope

Report Metric Details Market Revenue in 2022 $394.6 billion Estimated Value by 2027 $974.5 billion Growth Rate Poised to grow at a CAGR of 19.8% Market Segmentation By Products & Services, Components, End-User, & Region Market Driver growing adoption of e-prescribing, telehealth, mHealth, and other HCIT solutions. Market Opportunity Rising use of healthcare IT solutions in outpatient care facilities Geographies covered North America, Europe, APAC, MEA, and Latin America

This research report categorizes healthcare IT market to forecast revenue and analyze trends in each of the following submarkets

By Product & Service

Introduction

Healthcare Provider Solutions Clinical Solutions EHR Population Health Management Solutions Specialty Information Management Solutions PACS & VNA Mobile Health Applications HCIT Integration Systems Telehealth Solutions Medical Image Analysis Systems Laboratory Information Systems Practice Management Systems Clinical Decision Support Systems ePrescribing Solutions Radiology Information Systems Computerized Physician Order Entry Systems Cardiovascular Information Systems Patient Registry Software Infection Surveillance Solutions Radiation Dose Management Solutions Non-Clinical Healthcare IT Solutions Healthcare Asset Management Solutions Revenue Cycle Management Solutions Front-End RCM Solutions Mid-RCM Solutions Back-End RCM Healthcare Analytics Clinical Analytics Financial Analytics Operational and Administrative Analytics Customer Relationship Management Solutions Pharmacy Information Systems Healthcare Interoperability Solutions Healthcare Quality Management Solutions Supply Chain Management Solutions Procurement Management Solutions Inventory Management Solutions Medication Management Systems Electronic Medication Administration Systems Barcode Medication Administration Systems Medication Inventory Management Systems Medication Assurance Systems Workforce Management Solutions Financial Management Systems (Billing & Accounting) Healthcare Information Exchanges Medical Document Management Solutions

Healthcare Payer Solutions Claims Management Solutions Population Health Management Solutions Pharmacy Audit and Analysis Solutions Payment Management Solutions Customer Relationship Management Solutions Member Eligibility Management Solutions Fraud Analytics Solutions Provider Network Management Solutions

HCIT Outsourcing Services IT Infrastructure Management Services Payer HCIT Outsourcing Services Claims Management Services Provider Network Management Services Billing and Accounts Management Services Fraud Analytics Services Other Payer HCIT Outsourcing Services Provider HCIT Outsourcing Services Revenue Cycle Management Services Medical Documents Management Services Laboratory Information Management Services Other Provider HCIT Outsourcing Services Operational HCIT Outsourcing Services Supply Chain Management Services Business Process Management Services Other Operational IT Outsourcing Services



By Component

Introduction

Software

Services

Hardware

By End User

Introduction

Healthcare Providers Hospitals Ambulatory Care Centers (Outpatient Settings) Home Healthcare Agencies & Assisted Living Facilities Diagnostic & Imaging Centers Pharmacies

Healthcare Payers Private Payers Public Payers



By Region

North America US Canada

Europe Germany France UK Italy Spain RoE

Asia Pacific Japan China India RoAPAC

Latin America

Middle East & Africa

Recent Developments

In October 2022, Optum acquired Change Healthcare. The acquisition will connect and simplify the core clinical, administrative, and payment processes that providers and payers depend on to serve patients, resulting in lower costs and a better experience for all stakeholders. The company announced plans to acquire Change Healthcare in 2021.

In June 2022, Cerner partnered with Hazelden Betty Ford Foundation. The Oracle Cerner EHR and Xealth’s digital therapeutic distribution platform made it easier for Hazelden Betty Ford clinicians to personalize patient care by assigning them digital content, including therapeutic education, exercises, and workshops, accessible via the EHR’s patient portal.

In March 2022, Cognizant (US)) collaborated with Microsoft(US) .The collaboration aimed to deliver a new digital health solution to enhance remote patient monitoring and virtual health, utilizing products like smart watches, blood pressure monitors, and glucose meters to collect and communicate patient health data to providers for improved medical care.

Frequently Asked Questions (FAQ):

What is the projected market value of the global healthcare IT market? The global market of healthcare IT is projected to reach USD 974.5 billion. What is the estimated growth rate (CAGR) of the global healthcare IT market for the next five years? The global healthcare IT market is projected to grow at a Compound Annual Growth Rate (CAGR) of 19.8% from 2022 to 2027. What are the major revenue pockets in the healthcare IT market currently? In 2021, North America accounted for the largest share of healthcare IT, followed by Europe, Asia Pacific, Latin America, and the Middle East and Africa. The large share of North America can be attributed to the large adoption of healthcare IT solutions in the region, stringent regulations regarding healthcare quality, and the increasing need to curtail the escalating healthcare costs through healthcare IT solutions.

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