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

Digital Transformation for the Oil and Gas Sector

The savvy CEOs of multinational organizations will accelerate their investment in digital transformation projects in 2022, and beyond, to improve their competitiveness. Every industry leader that is forward-looking will act swiftly to grasp the upside opportunity. Global oil & gas companies face a myriad of operational, commercial, and existential security threats. According to the latest worldwide market study by ABI Research, oil & gas firms apply digitalization to combat these threats and will spend $15.6 billion on digital technologies by 2030. Oil & Gas Digital Apps Market Development Investments in digitalization can help to analyze a supply pipeline’s condition, prepare for fluctuations in the changing prices for oil and gas, as well as aid action plans to create more sustainable operations and transfer to producing renewable energy sources. "Safety and Security are top priorities for oil & gas operators. Data analytics allied with IoT platforms have become

2022 Tech Trends Outlook: What Happens Next?

This year may very well be another period of unprecedented challenges and opportunities. In 2022, several highly anticipated technology-related advancements will NOT happen, according to the predictions by ABI Research. Their analysts identify many trends that will shape the technology market and some others that, although attracting huge amounts of pundit speculation and commentary, are less likely to advance rapidly over the next twelve months. "The fallout from COVID-19 prevention measures, the process of transitioning from pandemic to endemic disease, and global political tensions weigh heavily on the coming year's fortunes," said Stuart Carlaw, chief research officer at ABI Research . What Won’t Happen in 2022? Despite all the headlines and investments, the metaverse will not arrive in 2022 or, for that matter, within the typical 5-year forecast window. The metaverse is still more of a buzzword and vision than a fully-fledged end goal with a clearly defined arrival d

The Fastest-Growing Mobile Opportunity in 2022

The number of mobile communication subscriptions worldwide is currently estimated at 8 billion, with 6 billion on smartphone connections, from a user base of 5.9 billion unique subscribers among a global population of 7.9 billion. Fifth-generation (5G) mobile service subscriptions using a compatible device significantly grew during the COVID-19 pandemic, but 4G connections remain the dominant force within the global telecom service provider sector. While the use of mobile phones is common throughout developing nations, 4G services are still an emerging technology in many parts of the world. Overall, 5G subscriptions will likely grow from 580 million at the end of 2021 to 3.5 billion by the end of 2026. 5G Mobile Market Development According to the latest worldwide market study by Juniper Research, revenue generated from 5G mobile services will reach $600 billion by 2026 -- representing 77 percent of global network operator-billed revenue. The adoption of 5G services across consumer and