Healthcare IT Outsourcing Market

Global Healthcare IT Outsourcing Market Size (2023 to 2028)

The size of the global healthcare IT outsourcing market is estimated to be worth USD 98.4 billion by 2028 and USD 70.8 billion in 2023, growing at a CAGR of 6.80% during the forecast period.

IT outsourcing in healthcare refers to a process in which a third party or external service provider assumes responsibility for managing IT business or IT services. These managed IT services assist companies in ensuring the stability, scalability, dependability, and flexibility required to grow. Outsourcing IT services is always an option for staying focused on key service areas, improving care quality, and lowering costs. Healthcare IT outsourcing has proven to be one of the most effective business strategies in our technologically sophisticated period during the previous few decades.

As outdated systems are phased out, most hospitals are searching for a wide variety of advanced technology services, including complete IT department management and outsourcing different things, including network infrastructure, service desk, application support, and heritage maintenance. Electronic Health Records, revenue cycle management, laboratory information systems, hospital management systems, hospital inventory management, hospital information system, pharmacy information, clinical decision support, E-Prescriptions, and many other medical solutions are common IT healthcare outsourcing services. IT outsourcing is an indispensable solution that allows you to focus on core performance areas, improve service quality and reduce costs.

MARKET DRIVERS:

The shortage of trained in-house IT professionals accelerates the growth rate of the global healthcare IT outsourcing market.

Many firms face difficulties determining how to handle IT employees in healthcare companies undergoing digital transitions. Growing adoption technologies create dozens of petabytes of data, necessitating a cutting-edge and dependable IT infrastructure. As a result, more businesses are contemplating health IT outsourcing for staff, hardware, and software during this era of fast development. The use of EHR, E-Prescriptions, and telehealth necessitated the hiring of qualified IT personnel. Furthermore, external professionals may assist hospitals in moving forward with tasks such as IT by providing knowledge that in-house IT personnel typically lacks. Outsourced IT businesses have several specialists on staff with experience in hardware, software, networks and servers, technical support, and more, whereas in-house IT personnel have limited knowledge. Outsourced IT firms also try to keep up with the newest technology, trends, security concerns, compliance requirements, and other issues. Installing best practices, providing trained employees, and working with hospital administrators to assure accountability through rigorous service level agreements may help competent healthcare IT outsourcers minimize numerous difficulties. As a result, the market for healthcare IT outsourcing is growing.

The cost-effectiveness of outsourcing is further expected to accelerate the demand for the global healthcare IT outsourcing market.

In a budget-constrained situation, healthcare institutions are already under pressure to maintain their IT systems. As a result, they're looking to outsource a portion of their IT operations more frequently. Because the single-payer will cover everything, healthcare providers would considerably reduce administrative expenses. According to a Black Book survey conducted in 2019, about 600 healthcare organizations that used or are currently using information technology outsourcing were polled. Around 90% of respondents say they are close to or have reached the total return on their IT outsourcing investment in only three months or less. Among them, 84 % of those still using outsourcing services stated they are pleased and comfortable with their services. Virtualizing health IT systems has also proven to be a cost-effective approach to outsourcing computing operations and the personnel required to maintain them. On the other hand, employing full-time IT specialists is prohibitively expensive for small and mid-sized healthcare institutions; therefore, they opt to outsource wherever possible. As a result, the healthcare IT outsourcing industry is expanding.

MARKET RESTRAINTS:

Data breaches are forecasted to significantly restrain the global healthcare IT outsourcing market's growth rate during the forecast period. When a healthcare facility hires an IT team on behalf of the hospital, there is an excellent danger of data breaches. According to CI Security analysts, 3.8 million individual records were stolen in the first half of 2020 due to hacking and IT incidents, compared to 30 million records exposed in the previous six months. But there's still a danger of being hacked when technology is handled inside, and the risk is much more significant when other parties are engaged. To comply with HIPPA rules, hospitals and third-party outsourcing partners must strengthen their patient's data security.

Impact of COVID-19 on the global healthcare IT outsourcing market:

IT outsourcing is becoming more prevalent as technology advances. COVID-19, in particular, has accelerated the need for healthcare IT outsourcing. Physician practices, healthcare networks, and medical facilities continue to suffer financial issues due to COVID-19, even though the government and payers have enacted regulations to help relieve sales cycle problems created by COVID-19. As a result, revenue cycle management outsourcing is becoming more popular. Outsourcing medical billing during COVID-19 also offered financial help and freed up resources. To handle in-house medical coding and billing, hospitals must spend a set amount regardless of worker performance. However, because hospitals outsource, they must pay a monthly portion of net collections throughout the pandemic.

Furthermore, COVID-19 digitalizes the globe, which enhances the requirement for fraud detection and prevention systems. Besides that, in COVID-19, digital patient services such as telehealth and virtual patient control and the convergence of all patient touchpoints, including preparation, payment, and telehealth, to reduce no-shows and improve satisfaction have increased, necessitating outsourcing services. Likewise, as the number of people afflicted with the coronavirus rises, E-Prescriptions as a temporary solution contribute to the growth of the healthcare IT outsourcing market.

REPORT COVERAGE:

This research report on the global healthcare IT outsourcing market has been segmented and sub-segmented based on application, industry, and region.

Healthcare IT Outsourcing Market – By Application:

• Provider Outsourcing
  • Electronic Health Records
  • Revenue Cycle Management System
  • Laboratory Information and Management System
  • Pharmacy Information and Management System
  • Others
• Payer Outsourcing
  • Customer Relationship Management System
  • Claim Processing Management System
  • Billing System
  • Fraud and Detection System
  • Other
• Life Science Outsourcing
  • Enterprise Resource Planning
  • Clinical Trial Management System
  • Clinical Database Management System
  • Research and Development IT services
  • Others
• Operational Outsourcing
  • Supply Chain Management
  • Business Process Management
  • Others
• Infrastructure Outsourcing
  • Infrastructure Management Services
  • Cloud Computing
  • Others

Healthcare IT Outsourcing Market – By Industry:

• Healthcare System
• Healthcare Insurance Industry
• Pharmaceutical Industry
• Clinical Research Organization
• Biotechnology
• Others

Healthcare IT Outsourcing Market – By Region:

• North America
• Europe
• Asia-Pacific
• Latin America
• Middle East and Africa

KEY MARKET PARTICIPANTS:

A few of the notable companies operating in the global healthcare IT outsourcing market profiled in this report are Accenture Plc., Allscripts Healthcare Solutions, Cognizant Technology Solutions, HCL Technologies, IBM Corporation, McKesson Corporation, Tata Consultancy Services Ltd., Epic System, Accretive Health, Anthelio Healthcare Solutions, Dell, Hewlett-Packard Company, Infosys Limited, Siemens Healthcare, Wipro Ltd. and Computer Sciences Corporation.

These companies focus on strategies like mergers, acquisitions, partnerships, and product launches.

RECENT MARKET DEVELOPMENTS:

• In July 2018, Southwest Mississippi Regional Medical Center announced a long-term contract for IT department management and software and infrastructure maintenance with Phoenix Health Systems, the leading independent supplier of hospital IT outsourcing and consulting services.
• In August 2020, R1 RCM Inc., a leading supplier of technology-enabled revenue cycle management services to healthcare providers, announced the completion of the Cerner RevWorks services business and commercial, non-federal customer connections.