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The global healthcare predictive analytics market size was valued at USD 7.88 billion in 2021. The market is projected to grow from USD 10.06 billion in 2022 to USD 69.63 billion by 2029, exhibiting a CAGR of 31.8% during the forecast period. The global COVID-19 pandemic has been unprecedented and staggering, with healthcare predictive analytics experiencing higher-than-anticipated demand across all regions compared to pre-pandemic levels. Based on our analysis, the global market exhibited a growth of 63.9% in 2020 as compared to 2019.
The significant shift of healthcare providers toward personalized medicine from traditional medications is due to reduced risk and efficient patient care associated with personalized medicine.
The increasing focus of healthcare providers on value-based healthcare is also anticipated to influence the demand for predictive healthcare analytics, strengthening their position in the market.
Therefore, the rising preference for personalized medicine and the increasing focus on value-based healthcare will further fuel the market growth during the forecast period.
Growing Role of Predictive Analytics in Clinical Trials & Drug Development Boosted Market Growth
The impact of COVID-19 is expected to result in considerably high market development during the analysis period. This is attributed to the significant acceleration in healthcare organizations' adoption of predictive analytics software. The market witnessed a humongous growth rate of 63.9% in 2020 compared to 27.4% in 2019. Major healthcare organizations in developed and developing countries prioritized sharing data, optimized care delivery, and offered supportive measures for healthcare analytics to promote market growth during the COVID-19 pandemic.
Healthcare organizations, such as National Health Service (NHS), Centers for Disease Control and Prevention (CDC), and Centers for Medicare & Medical Services (CMS), supported a large amount of data exchange between healthcare providers, which increased the demand for data analytic solutions for analyzing the huge amount of patient data shared during the COVID-19 outbreak. Moreover, the emerging applications of healthcare predictive analytics in clinical research and drug development, along with the rising investments in digital health, positively impacted the healthcare predictive analytics market growth during the pandemic. For instance, according to a study by McKinsey, investments in digital health and revenues of major telehealth players doubled in 2020 compared to 2019.
The healthcare predictive analytics players witnessed significant growth in revenue generated during 2020. For instance, Health Catalyst registered an increase of around 31.5% in its revenue generated in 2020 compared to 2019. Moreover, in 2020, IBM reported a rise of 2.1% in its revenue from cloud and cognitive software sales. Moreover, after the pandemic, market growth normalized to 32.9% in 2021 compared to revenues in 2020, owing to decrease in the surged demand during 2020.
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Incorporation of Advanced Technologies such as Machine Learning and Global Positioning Systems (GPS) in Predictive Analytics Solutions
New technologies such as machine learning and GPS in healthcare predictive analytics solutions aid in gathering & analyzing data in a more efficient & precise manner. Many companies in the global predictive analytics market are adopting these advanced technologies to gather and analyze data.
Also, adopting the algorithm can bring new opportunities for detailed data analysis. Applying a predictive algorithm, the prediction of healthcare issues among the population can be derived.
Thus, incorporating advanced technologies in predictive analytics tools contributes to the overall surge in demand for predictive analytics tools.
Preferential Shift of Providers toward Personalized Medicine is Fueling the Demand for these Solutions
The well-established healthcare sector in developed countries, coupled with the rising adoption of EHR systems in healthcare facilities, generates a large amount of patient data. The healthcare payers and providers use this data to analyze the trend using predictive analytical solutions for strategic decision-making. Moreover, the stringent federal regulations and laws such as the Health Insurance Portability and Accountability Act (HIPAA) and the Patient Protection and Affordable Care Act (PPACA) for the adoption of digital platforms are encouraging the use of EHR, which is anticipated to surge the demand for healthcare predictive analytics in the near future.
Moreover, the rising penetration of the Internet of Medical Things (IoMT) is one of the major factors propelling the market growth during the forecast period. The relationship between IoMT and medical technology benefits healthcare organizations in achieving better outcomes, improving efficiency, and delivering advanced patient care. Government organizations are focused on increasing investments in IoT healthcare to evolve the healthcare ecosystem of the countries. The application of advanced analytics to a medical device can help understand patient health more clearly, improve management quality, and empower accurate decision-making.
Moreover, healthcare providers prefer personalized medicines to a large extent. For instance, according to the Personalized Medicine Coalition (PMC) report, personalized medications on the market more than doubled between 2016 and 2020 in the U.S.
These factors above drive market growth and contribute to the rise in demand for healthcare predictive analytics systems.
Data Privacy Concerns, Theft Issues, and High Cost Solutions to Hamper Market Growth
Patient data privacy and recent data breaches are mainly responsible for the lower adoption of digital health solutions. Healthcare organizations maintain detailed patient records, including patient name, date of birth, address, social security number, and payment account information, making it a preferred target for cyber-attacks. The patients are unwilling to share their medical records with digital platforms and applications. The growing incidences of healthcare data breaches are anticipated to hamper the adoption of digital health solutions, including healthcare predictive analytics, in the near future.
Thus, these factors have played a pivotal role in limiting the demand for new systems and restraining the market growth.
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Increasing Adoption of Predictive Analytics Tools in Emerging Countries Aided the Growth of the Software Segment
Based on component, the market is classified into software and hardware.
The software segment dominated the market in 2021. The increase in new product launches in this segment and the increasing adoption of predictive analytics tools to predict seasonal disease in emerging countries are driving the segment's growth.
On the other hand, the hardware segment is expected to grow at an optimal CAGR during the forecast period.
Rising Need for Financial Analytics Across the Healthcare Facilities Aided in Boosting the Segment Growth
Based on application, the market is segmented into clinical analytics, financial analytics, and operational analytics.
The financial analytics segment captured the largest market share in 2021. The growing number of financial frauds in the healthcare industry and the increasing need for financial analytics solutions in healthcare facilities are anticipated to drive the demand for the financial analytics segment during the forecast period.
On the other hand, the clinical analytics segment is expected to grow at the highest CAGR during the forecast period. The increasing number of clinical trials coupled with the rising demand for an efficient technology platform to manage huge amounts of patient data related to clinical trials.
The operational analytics segment is expected to grow optimally during the forecast period. The growth is due to the adoption of operations and administrative analytics tools by hospitals and healthcare organizations in the countries of this region. These tools enhance the efficiency and operating speed of hospitals and healthcare organizations.
Payers to Dominate due to Increasing Strategic Collaborations for the Development of Innovative Solutions and Growing Number of Healthcare Insurance Holders
The market is classified into payers, providers, and others based on end user.
Payers captured the largest market share in 2021, owing to increasing strategic collaborations by healthcare payers for the development of innovative solutions along with the growing number of healthcare insurance holders globally.
On the other hand, the providers segment is expected to grow at the highest CAGR during 2022-2029. The segment’s growth is attributed to the increasing number of hospitals and the growing adoption of healthcare analytic software in healthcare facilities.
Therefore, introducing new hospitals and growing adoption of healthcare analytic software are further fueling the segment growth during the forecast period.
North America Healthcare Predictive Analytics Market Size, 2021 (USD Billion)
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Based on region, the global market is classified into North America, Europe, Asia Pacific, Latin America, and the Middle East & Africa.
The North America market was valued at USD 3.30 billion in 2021. The region’s dominance is due to the increasing patient population with chronic diseases, the presence of key market players, and the constant focus of market players on strategic collaborations to provide innovative solutions in the region.
Europe held the second position in the global market. The higher awareness about healthcare solutions, along with strategic collaborations and government-initiated projects, is the major factor behind its high healthcare predictive analytics market share. For instance, in September 2021, the World Health Organization (WHO) and the Federal Republic of Germany launched the WHO Hub for Pandemic and Epidemic Intelligence in Germany. The new hub is the global platform for pandemic and epidemic intelligence. It predicts, prevents, detects, prepares for, and responds to worldwide health threats.
Asia Pacific is expected to witness the highest CAGR during the forecast period. The growth of this region is attributed to the growing e-health initiatives in countries including China and India and the increasing need for healthcare analytics in healthcare facilities to manage a large amount of patient data. This combined with increasing product launches in the EHR segment is anticipated to drive the adoption of healthcare predictive analytics solutions in the near future. For instance, in June 2021, Epillo Health Systems launched integrated clinical solutions for patients and clinicians. The new solution consists of EHR systems for clinics and pharmacies and a mobile app for patients.
On the other side, the Latin America and Middle East regions are likely to grow slower. Government agencies' active involvement in implementing analytics and AI-based healthcare solutions is accelerating the market growth in these regions.
Focus of Key Players on Introduction of New Products to the Market to Strengthen their Position
In terms of the competitive landscape, the market is highly fragmented, with various national and international healthcare predictive analytics players. Also, due to the huge potential market opportunity in the digital transformation era, many start-up companies are entering the market. Leading companies such as IBM, Cerner Corporation, Epic Systems Corporation, Allscripts Healthcare LLC., SAS institute dominated the market. Innovative healthcare analytics solutions coupled with the strong brand presence of companies across the globe are the major factors for the dominating position of these companies.
Other companies, such as Health Catalyst, Inovalon, Flatiron, Linguamatics, and Oracle, have a prominent presence in the global market. Increased demand for telemedicine, remote patient monitoring, home care, and rising adoption rates is likely to favor the expansion of the companies. Emerging companies such as Wipro, Vitreos Health, CitiusTech, and SCIO Health Analytics, being new entrants, are focused on gaining a competitive advantage by innovating technologies via strategic collaborations.
An Infographic Representation of Healthcare Predictive Analytics Market
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The healthcare predictive analytics market research report provides a detailed analysis of the market. It focuses on key aspects of its component, application, and end user. Besides this, it offers insights into market trends. It highlights key industry developments, mergers and acquisitions, and technological advancements of the major players with the impact of COVID-19 on the market. In addition to the above mentioned factors, the report encompasses several factors that have contributed to the market's growth in recent years.
Value (USD billion)
By Component, Application, End User, and Geography
By End User
Fortune Business Insights says that the global market stood at USD 7.88 billion in 2021 and is projected to reach USD 69.63 billion by 2029.
In 2021, the market stood at USD 7.88 billion.
Growing at a CAGR of 31.8%, the market will exhibit faster growth during the forecast period (2022-2029)
The software segment is expected to be the leading segment in the market during the forecast period.
The rising adoption of the EHR & Internet of Medical Things (IoMT) and the preferential shift of providers toward personalized medicine will drive the market.
IBM, Cerner Corporation, and Allscripts Healthcare LLC. are the top players in the market.
North America is expected to hold the highest market share.
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