Skip to main content

Healthcare IT Services Market will Reach $68.3 Billion

The healthcare landscape has been subject to significant turbulence due to a broad range of factors -- including escalating costs, widespread regulatory amendments, changing business models, and evolution of the patient-centric paradigm.

That said, controlling rising costs and improving operational efficiency in the healthcare IT sector will be a high priority during 2017, as more hospital and clinic organizations seek to document the quality of their care and ramp up patient engagement.

Healthcare IT Market Development

By 2020, healthcare providers will more than double their spending on technology services, which represents a revenue opportunity of over $9 billion for the healthcare IT outsourcing (ITO) vendors, according to the latest market study by the Everest Group.

The healthcare provider segment is poised to be one of the fastest growing segments in the healthcare IT services market in coming years.

According to the study findings, accelerated IT investments on the part of healthcare providers will be driven in large part by new reimbursement policies taking effect under the Medicare Access and CHIP Reauthorization Act of 2015 (MACRA).

Under MACRA, providers will earn more or less depending on the quality and effectiveness of the care they provide. As a result, healthcare providers will continue investing heavily in technology that supports initiatives such as compliance, legacy modernization, electronic health records (EHR) and patient engagement.

"MACRA encourages ongoing technology adoption by U.S. healthcare providers by mandating specific tech-related measures," said Abhishek Singh, practice director at Everest Group.

This will translate directly into four IT investment trends that will develop over the course of the next 24 months. First, performance improvement and cost takeout will be a strategic focus; both are critical for compliance and to raise capital from the market.

Second, patient engagement will drive the differentiation strategy. Third, there will be a growing urgency for data security. And, finally, there will be a more demand for IT interoperability, nimbleness and innovation.

Other key findings from the study include:
  • The global healthcare (payer and provider combined) ITO market is expected to grow at 12 percent CAGR during the forecast period, reaching $68.3 billion in 2020.
  • Demand in the provider ITO market has been concentrated in the larger health systems.
  • Currently, application, development and maintenance (ADM), testing and network services rank highest among the IT services included in ITO deals within the provider segment.
  • Given the consolidation and convergence in the market, systems integration (SI), testing and asset rationalization work streams are expected to grow in 2017.

Popular posts from this blog

How the COVID-19 Pandemic Advanced Telehealth Adoption

The global COVID-19 pandemic has accelerated digital transformation across many industries. As an example, consider the healthcare sector. Some routine medical situations can be diagnosed and resolved online. While the trend was already in motion long before the pandemic arrived, the adoption of telehealth increased rapidly in 2020. Around the world, many governments responded to the disruption and inaccessibility of healthcare facilities by loosening previous regulations and restrictions on the practice of telemedicine apps, and teleconsultations. This decision resulted in the mass adoption of these medical services among patients and providers. According to the latest market study by Juniper Research, telemedicine will save the healthcare industry $21 billion in costs by 2025 -- that's rising from an estimated $11 billion in 2021. This increased app usage represents an anticipated growth rate of over 80 percent in the next four years. Telehealth Services Market Development The co

Worldwide Semiconductor Demand will Accelerate in 2021

The technology sector is a key driver of the U.S. economy. Therefore, components like semiconductors play an important role in America's future. The 'CHIPS for America Act' is a new law that calls for incentives on domestic semiconductor manufacturing and investments in research and development. But these renewed efforts will require years of ongoing commitment. Meanwhile, despite the impact of the COVID-19 pandemic, the semiconductor market performed well in 2020. However, new demand by industry was uneven throughout last year due to global lockdowns, remote working adoption, and shifts in consumer and commercial buying behavior. Worldwide semiconductor revenue grew to $464 billion in 2020 -- that's an increase of 10.8 percent compared to 2019, according to the latest market study by International Data Corporation (IDC). Semiconductor Technology Market Development IDC now forecasts that the semiconductor market will reach $522 billion in 2021, that's a 12.5 percent

Hyper-automation Propels Superior Business Process Redesign

When the world was disrupted by a global pandemic during 2020, many CEOs and their board of directors were consumed by reacting to immediate problems. Meanwhile, a few forwarding-thinking enterprise leaders also paused to invest in accelerating their prescient digital transformation agenda. What enables executives to envision an opportunity while others see only challenges? Strategic foresight, and a willingness to embrace the apparent changes that are transforming the legacy status quo. During this period of uncertainty, hyper-automation investment has gained new momentum. Hyperautomation is the application of advanced technologies that augment humans by helping to streamline processes in new ways that are significantly more impactful than the legacy approach. Hyperautomation Market Development The global market for technology that enables hyperautomation will reach $596.6 billion in 2022, according to the latest worldwide market study by Gartner. This is up from $481.6 billion in 202