Digital healthcare market overview

14 July 2021 Projectus Consulting

Pexels Pavel Danilyuk 8442370

​Overview

In 2020 the global digital health market was valued at USD 9.65 billion and is expected to grow at a compound annual growth rate (CAGR) of 15.1% from 2021 to 2028. Growing cases of obesity, the high commonness of chronic diseases, such as diabetes, Cardiovascular Disorders (CVDs), growing need for remote patient monitoring services, and increasing patient engagement & connectivity owing to the high adoption of digital health technology are the major factors promoting the market growth. According to research data published in NCBI in 2018, 95% of the U.S. adult population possessed a mobile phone, with 64% of them owning smartphones. As per the report published by the GSM Association, Mobile Economy 2018, the number of people linked to mobile services surpassed 5 billion in 2017 and the number of unique mobile subscribers is anticipated to reach 5.9 billion by 2025.

In addition, a growing trend of preventive healthcare coupled with rising funding for various mHealth start-ups is further pushing the market growth. A rise in the number of patients suffering from conditions requiring Long-term Care (LTC) including Alzheimer’s disease, cancer, diabetes, and CVDs is also driving the market growth. Chronic or long-term conditions are a major economic burden on hospitals and clinics, which, in turn, is expected to drive the demand for telehealthcare services for remote monitoring and physician consultation of LTC patients.

According to the Pharmaceutical Services Negotiating Committee, in 2018, over 26 million people in England had at least one long-term condition. According to the data published by NHS England, in 2018, long-term conditions accounted for 64% of all hospital outpatient appointments, 50% of all General Practitioner (GP) appointments, and 70% of inpatient bed days. Furthermore, the growing demand for speciality health consulting, especially in remote areas, is boosting digital health implementation. The adoption of various software, such as Electronic Health Records (EHRs)/Electronic Medical Records (EMRs), has significantly increased due to healthcare systems' assistance.

The application span of the software is rapidly increasing in medical devices, clinical decision support, health IT systems, mHealth apps, fitness trackers, telehealth systems, and wearable devices, which, in turn, is propelling the market growth. The Covid-19 pandemic has significantly increased the demand for digital health among consumers as well as physicians and practitioners and is offering several opportunities, considering social distancing, as the only existing solution to minimize exposure. According to the study conducted by SSCG Media Group, in March 2020, 53% of the healthcare practitioners were using telemedicine owing to the restrictions imposed on account of the pandemic.

The rising adoption of telehealth services during the pandemic is increasing the safety of both healthcare providers and patients, as it eradicates in-person appointments and further increases the provider capacity. According to the guidelines published by the CDC in July 2020, it recommended the implementation of telehealth services for high-quality patient care, and prevention and control of infections during the pandemic. All these factors contributed to the digital health market growth.

Furthermore, rising investments, mergers, acquisitions, joint ventures, product launches, partnerships, collaborations, and government initiatives are driving the market growth. In February 2018, Allscripts acquired Practice Fusion. The acquisition helped the company expand its customer base to about 30,000 ambulatory practices that currently use Practice Fusion’s cloud-based EHR system. This also helped the company in expanding and developing its big data & analytics capabilities.

 

Technological insights

MHealth technology accounted for the largest market share of over 47% in 2020 and is expected to register a lucrative CAGR during the forecast period. Growing access to smartphones and internet connectivity, availability of several mHealth apps, and rising adoption of these technologies by physicians and patients are the key factors driving the segment. Rapid technological advancements and the development of new products is further propelling the segment growth. The healthcare analytics segment is expected to register the fastest CAGR from 2021 to 2028. Increasing pressure from governing bodies to reduce the treatment costs and other associated expenditures that originate from hospital workflow inefficiencies and medical product flaws is boosting the usage of big data in the healthcare sector, thereby fuelling the approval of healthcare analytics software and solutions.

Other factors, such as increasing demand for smartwatches, growing demand to track services and systems across diverse industry verticals, technological advancements in IoT technology to deliver better connectivity, coverage, and real-time monitoring is bolstering the segment growth. For instance, SafeBeing is an AI-powered, real-time remote monitoring wearable solution that supports caregivers in reducing hospitalisations, detecting changes in activity patterns, and improving quality metrics.

  • Competitive benchmarking

  • Historical data & forecasts

  • Company revenue shares

  • Regional opportunities

  • Latest trends & dynamics

 

Component Insights

Services accounted for the largest revenue share of 47.19% in 2020. The segment includes various activities, such as training and integration, installation, and up-gradation. The rise in demand for software platforms, such as EHRs, the growing trend of software up-gradation for the inclusion of a collection of healthcare applications is driving the segment as companies focus on delivering post-installation services including training, staffing, optimisation, clinical and other services. Additionally, the rise in the number of investments in digital infrastructure, majorly in developing countries, is driving the adoption of digital health services for implementing successful digital platforms.

However, the software component segment is expected to register the fastest CAGR over the forecast period. The increasing demand for reducing medical costs and the growing need for accurate and timely information obtaining are among the key factors responsible for the segment growth. In addition, consumer shift towards value-based care in developed economies, rise in demand for efficient management of organizational workflows in healthcare organizations, and various initiatives by private and public companies to develop healthcare IT infrastructure will increase the adoption of digital health software solutions.

 

Regional Insights

North America accounted for the largest market share of 38.77% in 2020 and will expand further at a steady CAGR over the forecast period. Rising healthcare costs, advancements in coverage networks, increasing acceptance of smartphones, and a surge in demand for telehealthcare services drive the region's market growth. According to the report published by Mckinsey in May 2020, the Covid-19 pandemic instigated a significant increase in the adoption and usage of telehealth in the U.S. Adoption of telehealth services by consumers has shot up in the country, from 11.0% in 2019 to 46.0% in 2020 to replace the cancelled healthcare visits.

The Asia Pacific is predicted to be the fastest-growing regional market over the forecast period. Rising smartphone infiltration, increasing adoption of smart wearable devices, and a surge in demand for EMRs and EHRs are contributing to the growth of the regional market. Moreover, countries, such as Malaysia and Japan, have already established a national warehouse that enables data sharing between public hospitals. In addition, the rising demand for remote patient monitoring and related services owing to increasing government spending on healthcare is anticipated to propel market growth.

 

Key Companies & Market Share Insights

Mergers & acquisitions and strategic alliances with other industry participants and increasing R&D in mHealth technologies are some of the initiatives being undertaken by key companies to increase their market share. For instance, in June 2018, Medidata, cloud storage and data analytics company, acquired Shyft Analytics for USD 195.0 million. The acquisition helped the company in jointly developing data platforms that can be used in processes ranging from the beginning of the drug development phase to its commercialisation. Some of the key companies in the global digital health market are:

  • Allscripts

  • Apple, Inc.

  • Telefónica S.A.

  • Mckesson Corporation

  • Epic Systems Corporation

  • QSI Management, LLC

  • AT&T

  • Vodafone Group

  • AirStrip Technologies

  • Google, Inc.

  • IBM Corporation

  • CISCO Systems, Inc.

 

Summary

This report forecasts revenue growth at global, regional, and country levels and provides an analysis of the latest industry trends in each of the sub-segments from 2016 to 2028. The global digital health market size was estimated at USD 96.5 billion in 2020 and is expected to reach USD 110.2 billion in 2021. Several key factors are driving the market growth include increasing adoption of digital healthcare, favourable initiatives, and technological advancements for developing innovative digital solutions.

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