Healthcare ERP Market
Number of pages: 100 | Report Format: PDF | Published date: March 17, 2023
Historical Years – 2021 | Base Year – 2022 | Forecasted Years – 2023-2031
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Report Attribute |
Details |
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Market Size Value in 2022 |
US$ 6.2 billion |
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Revenue Forecast in 2031 |
US$ 10.66 billion |
|
CAGR |
6.1% |
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Base Year for Estimation |
2022 |
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Forecast Period |
2023-2031 |
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Historical Year |
2021 |
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Segments Covered |
Function, Deployment, End-user, and Region |
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Regional Scope |
North America, Europe, Asia Pacific, Latin America, and the Middle East & Africa |
According to the deep-dive market assessment study by Growth Plus Reports, the global Healthcare ERP market was valued at US$ 6.2 billion in 2022 and is expected to register a revenue CAGR of 6.1% to reach US$ 10.66 billion by 2031.
Healthcare ERP Market Fundamentals
Healthcare enterprise resource planning (ERP) systems are designed to manage and oversee the entire financial process of a company by tracking costs, income, and assets. ERP-based financial management systems can assist in gaining financial insight and accounting information. ERP solutions for hospitals are built with cutting-edge technologies, such as AI analytics and machine learning, to secure sensitive medical data from security threats. ERP systems are excellent for developing reliable strategic strategies and gaining correct information. Healthcare ERP systems may also track institutional healthcare performance. Budgeting, patient visits, requisitions, and other topics are covered. Business intelligence solutions for healthcare aid in data analysis to find areas for improvement.
Healthcare information systems are complicated and interconnected. In the past, healthcare information systems were frequently built with a patchwork of specialized subsystems that did not communicate effectively with one another. This haphazard approach increased complexity, reducing an organization’s ability to care for patients and increasing expenditures. A solid ERP solution unites all of the diverse parts of a complicated healthcare company under a single roof. Each component is designed to work with the others, offering carers unrestricted access to all data across the company. Data may be exchanged between patient and clinician systems and back-office administrative, personnel, and financial systems, supporting improved cost tracking and resource management.
ERP was established in businesses relying on logistics and the supply chain. Companies could obtain the comprehensive benefits outlined in the preceding section by implementing an ERP strategy. Healthcare may be concerned primarily with individual human health, yet how it is accomplished necessitates an intrinsically industrial approach. Hospitals and physician networks use a supply chain to acquire medical goods and deliver them to operating rooms, exam rooms, and individual patients. Patient care scheduling necessitates a logistics-based strategy, with physician availability, procedure planning, and equipment reservations being essential components.
ERP for healthcare is a natural progression of this systematic methodology. Despite its unique characteristics, healthcare continues to rely on cost management and data insights down to the individual unit, whether that unit is a piece of surgical equipment, an imaging report, or the patients themselves. Healthcare ERP systems provide a technique to increase the efficiency of these procedures.
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Healthcare ERP Market Dynamics
The growing usage of ERP systems among small and medium-sized organizations contributes to increased demand for these systems to lower operational costs and improve functional outcomes. Accessing centralized patient data from remote places improves patient acquisition and management strategies. These systems enable firms to combine data from human resources, production and inventories, supply chain cycles, and finance and accounting, as well as optimize back-end operations, such as payroll administration, account management, and inventory management. ERP systems are used in pharmacies and laboratories for inventory management, point-of-sale profiling, accounting, buying, and selling.
Institutes and facilities are rapidly using cloud-deployed ERP systems due to their numerous benefits, including low ownership costs, agile and adaptable infrastructure capacity, limited in-house technical experience, low capital requirements, and constant updates. As on-premises systems need significant capital investment and cost between US$ 50 million and US$ 150 million, small and medium-sized firms quickly embrace cloud-deployed ERP systems. Cloud-based solutions do not require an initial investment and depend on ongoing costs.
The increased number of hospital admissions raises pressure on healthcare institutions to provide treatments as rapidly as possible. The rising number of hospital admissions results from the worldwide population’s increasing incidence of numerous chronic illnesses, such as cancer. According to the International Agency for Research on Cancer, there will be around 19.3 million new cancer cases and 10 million cancer deaths worldwide in 2020. Around 28.4 million new cancer cases will be registered globally by 2040.
Healthcare ERP Market Ecosystem
The global healthcare ERP market has been analyzed from four perspectives: function, deployment, end-user, and region.
Healthcare ERP Market by Function
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Based on function, the healthcare ERP market has been segmented into supply chain & logistics, finance & billing, inventory management, patient relationship management, and others.
The finance & billing segment is projected to dominate the market during the forecast period. Healthcare organizations are increasingly using ERP systems to improve processes and reduce barriers between front-end revenue cycle management operations and back-end activities, such as claims management. Businesses use these systems to eliminate financial data silos, track profitability, manage ledgers, manage fixed assets, risk management, multi-currency management, reporting, and tax management. ERP solutions are predicted to boost the segment and enable comprehensive financial transparency, informed planning and budgeting, improved productivity, seamless integration of financial ERP modules into business systems, and real-time financial monitoring.
The inventory management segment is expected to show the fastest revenue growth during the forecast period. ERP modules focused on inventory and material management enable improved reporting, real-time supply chain management, total inventory analysis, increased quality checks, and inventory planning. The software’s powerful and comprehensive functionality eliminates information silos, improves production processes, and automates multiple tasks. According to an article published in March 2018 by Xtelligent Healthcare Media, LLC, the combination of analytics and automation with inventory management has resulted in an efficient order of supplies and organization management. It also reduces the need for double handling of items and automates regular activities, such as reordering. These factors have fueled the adoption of inventory and material management ERP solutions.
Healthcare ERP Market by Deployment
Based on deployment, the healthcare ERP market has been segmented into on-premise and cloud.
The on-premises segment is expected to dominate the market during the forecast period owing to several benefits, such as little maintenance, minimum reliance on vendors, ease of access from remote places, decreased expenses, total control over operations, security and privacy, and easy customization. On-premises software deployment is sometimes referred to as shrink-wrap. It comprises installing systems and solutions on computers available within the firm. Although these solutions are installed on-premises PCs and servers, they can be accessed from anywhere, lowering deployment costs and power usage. However, the expansion of cloud computing and its growing acceptance rates will likely limit the growth of the on-premises category. Furthermore, server rooms’ physical space and maintenance costs are projected to stifle the expansion of the on-premises segment.
Healthcare ERP Market by End-user
Based on end-user, the healthcare ERP market has been segmented into hospitals, clinics, nursing homes, and others.
The hospitals segment is likely to dominate the market during the forecast period. It could be attributable to the greater penetration of public and private hospitals worldwide. Rising government and business segment expenditures in deploying digital and technologically advanced tools and equipment are predicted to support hospital expansion. Furthermore, the rising number of hospital admissions due to the increasing prevalence of chronic illnesses is driving the implementation of ERP systems. Additionally, the rise in investments in creating smart hospitals is a crucial driver driving the global growth of the hospital healthcare ERP market.
Healthcare ERP Market by Region
Based on region, the healthcare ERP market has been segmented into North America, Europe, Asia Pacific, Latin America, and the Middle East & Africa.
North America is likely to dominate the market during the forecast period. This is due to the rising usage of digital and automated technology in North America’s healthcare industry. Furthermore, the rising usage of healthcare services due to illness incidence and higher healthcare spending has driven healthcare providers in North America to implement ERP systems to provide patients with better and more individualized services. Moreover, government measures to increase the adoption of digital technology to minimize paperwork, maintain a patient database, and improve the delivery of timely health services have played an important role in the development of the North America healthcare ERP market. The adoption of healthcare ERP in North America can be linked to the numerous benefits provided by ERP software, such as improved resource utilization and increased care efficiency. Major North American players are developing and growing their product portfolios to suit small and medium-sized enterprises.
Over the projection period, Asia Pacific is expected to be the most opportunistic market. Rising government investments in the region’s digitalized and technologically enhanced healthcare infrastructure will likely fuel market expansion. Furthermore, the rising cases of numerous chronic illnesses and the increasing senior population substantially increase the number of patients. As a result, the demand for healthcare ERP is predicted to expand significantly in the Asia Pacific region during the forecast period to provide patients with faster and better treatment.
Healthcare ERP Market Competitive Landscape
Market participants continually improve their technology to provide novel items for the healthcare business. Moreover, prominent players are focused on mergers and acquisitions, technical collaborations, and product expansion strategies to move the healthcare enterprise resource planning market forward. For instance, SAP and Microsoft announced their strategic collaboration and intend to integrate SAP’s intelligent portfolio of software products with Microsoft Teams in January 2021. In addition to their current strategic collaboration, the companies formalized a broad extension to enhance SAP S/4HANA adoption on Microsoft Azure. SAP improves customer experience and grows compatibility with Microsoft Azure through this relationship. In Another instance, Infor bought Intelligent InSites, Inc., a major healthcare software and services provider in North Dakota, in January 2020. Intelligent InSites, Inc. delivers dynamic, scalable, and intuitive location systems to organizations to optimize operations, shorten patient journeys, and improve healthcare results. Infor enhanced its technical products portfolio and strengthened its commercial footprint in clinics, emergency departments, urgent care, procedural care, inpatient care, and mental health as a result of this acquisition.
The prominent market players in the global healthcare ERP market include:
Healthcare ERP Market Strategic Developments
Asia Pacific is the key growth region in the global healthcare ERP market.
The rising number of hospital admissions and the increasing need for the automation of tasks are propelling the market revenue growth.
The global healthcare ERP market is expected to reach US$ 10.66 billion by 2031.
The global healthcare ERP market is projected to register a revenue CAGR of 6.1% during the forecast period.
Some prominent market players in the global healthcare ERP market include McKesson Corporation, Microsoft, and SAP SE.
*Insights on financial performance are subject to the availability of information in the public domain