Healthcare IT Outsourcing Market - Growth, Trends, COVID-19 Impact, and Forecasts (2022 - 2027)
The healthcare IT outsourcing market is expected to register a CAGR of nearly 8.3% during the forecast period. The market is expected to grow due to the rising pressure to reduce healthcare costs, globally, and increasing need to manage cash flow in back-office administration and IT management systems are the major factors driving the growth of the healthcare IT outsourcing market.
Additionally, the increased patient-centric and value-based approaches in healthcare, shortage of in-house trained IT professionals, government focus on introducing IT in healthcare, and reduction in operational and healthcare costs are driving the market. However, the threat to data security and confidentiality, lack of a standard platform, and shortcomings in performance, as compared to expectations, act as restrainting factor for the growth of the market.
The payers HCIT outsourcing segment is expected to witness a healthy CAGR over the forecast period, owing to significant changes in the healthcare landscape. On account of regulatory amendments and escalating costs, most healthcare firms adopted new technologies and outsourcing business models.
Currently, large companies are collaborating with large BPOs and KPOs for services, such as health claims, billing and accounts, and healthcare IT operations. As the number of people with insurance is on the rise, managing the processes efficiently is becoming a lower-value contribution to the bottom line. Having benefited from the cost saving and improved efficiency in quality, more payers are outsourcing to large BPOs with integrated cloud-based platforms, for claim administration and member lifecycle management. In an attempt to reduce the costs while providing high-quality patient care, healthcare insurance payers are streamlining their processes. The steady growth in the number of people opting for insurance and technological advancements have paved the path for the increase in healthcare payer services.
Currently, North America dominates the healthcare IT outsourcing market, and it is expected to continue its stronghold over the forecast period. This region is expected to increase its market share in the future, owing to its well-established healthcare industry and better reimbursement systems. The United States therefore holds the majority of the market in the North American region, due to the higher adoption of digital healthcare and rising investments made by the companies in the country.
The healthcare IT outsourcing market is highly competitive and consists of several major players. However, with technological advancements and product innovations, mid-size to smaller companies are increasing their market presence, by introducing new products and services at low prices. For instance, in 2017, Infosys launched Infosys Nia, the next-generation integrated artificial intelligence platform. Some of the major companies operating in the market are IBM, Oracle, Cerner, Mckesson, Philips Healthcare, Siemens Healthcare, Accenture, Tata Consultancy Services, Dell, and Infosys.