Big growth forecast for health IT market

Government initiatives, demand for CPOE among drivers
By Bernie Monegain
10:09 AM
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Health IT market pegged to grow by leaps.

The North American healthcare information technology market is forecast to grow at a compound annual growth rate of 7.4 percent to reach $31.3 billion by 2017 from $21.9 billion in 2012, according to Research and Markets’ North American Healthcare IT Market Report 2013-2017. The growth is driven by increasing demand for clinical information technology, and administrative solutions and services.

“Healthcare information technology has emerged as a promising development to transform the paper-based healthcare system into a digitized one,” report authors write in a news release. “HCIT also gives clinicians real-time access to patient data, and provides them with support to make the best possible decisions. It streamlines processes and reduces administrative overhead. The impact of IT on healthcare in the past decade has been modest, despite the huge potential.”

[See also: RCM market expected to grow by leaps.]

The report segments the market on the basis of applications, delivery modes, and components. Based on application, the North American healthcare information technology is segmented into provider (clinical information technology and non-clinical information technology) and payer, while the market by delivery mode is further categorized as on-premises, Web-based, and cloud-based. The healthcare information technology by component is made up of hardware, software and services.

Major factors driving the growth of the healthcare information technology market are the rise in pressure to cut healthcare costs, growing demand to integrate healthcare systems, high rate of return on investment, financial support from the U.S. government, government initiatives, the rise in aging population, growing demand for CPOE adoption in order to reduce medication errors and the rise in incidences of chronic disorders, according to the report.

However, the report notes, major constraints to the growth of the healthcare IT system include the high cost of healthcare IT solutions, high maintenance and service costs, interoperability issues, shortage of healthcare IT professionals, poor standard healthcare protocols such as Health Insurance Portability and Accountability Act and unprecedented growing incidences of data breaches of patient information.

[See also: RCM market expected to grow by leaps.]

Canada is expected to register the highest CAGR of 7.7 percent respectively in the overall North America healthcare information technology market, followed by the U.S. at 7.2 percent. However, the U.S. accounted for the highest share -- 72.6 percent -- of the North America healthcare IT market and is expected to reach $22.6 billion by 2017 as compared with $15.9 billion in 2012. The factors likely to propel the Canadian market are its public funded health structure, prominent role played by Canada Health Infoway, growing pressure to cut healthcare costs, and the rise in incidences of chronic diseases.

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