Healthcare Interoperability Solutions Market Size, Share & Trends Analysis Report By Deployment (Cloud-based, On-premise), By Level (Foundational, Structural, Semantic), By Type (Solutions, Services), By End-User (Healthcare Providers, Healthcare Payers, Pharmacies) and By Region(North America, Europe, APAC, Middle East and Africa, LATAM) Forecasts, 2023-2031

Market Overview

The global healthcare interoperability solutions market was valued at USD 3.62 billion in 2022. It is estimated to reach USD 11.21 billion by 2031, growing at a CAGR of 13.39% during the forecast period (2023–2031). The major driver for the global healthcare interoperability solutions market is the surging investment in IT healthcare solutions and healthcare interoperability. In addition, healthcare costs across the globe are continuously rising, raising concern amongst the population around the globe. Healthcare interoperability solutions can help to counter this problem, thereby boosting market growth.

Interoperability in healthcare is the integration and utilization of electronic health data and timely and secure access to improve the health outcomes of individuals and populations. The healthcare industry is highly focused on enhancing the quality of healthcare facilities and operational efficiency, reducing medical errors during various medical procedures, and minimizing operational costs. These solutions enable the exchange of health information between two or more systems and the subsequent use of the received data. A lack of interoperability and integration between payers, pharmacies, clinicians, patients, and even legislators could weaken the continuum of unified healthcare.

Market Dynamics

Global healthcare interoperability solutions market drivers

Increasing investment in it healthcare solutions and healthcare interoperability

Over the past decade, the increased collection of electronic healthcare data and investment in health IT infrastructure have created unprecedented opportunities for biomedical and health services research. Healthcare IT investment is estimated to grow faster due to strong government support in various countries for the healthcare industry. For instance, according to the Public Health Information and Technology Infrastructure Modernization Funding Report in 2022, the Healthcare Information and Management Systems Society (HIMSS) has released a report recommending a 10-year investment of USD 36.7 billion in public health infrastructure modernization to ensure readiness for ongoing and emerging public health emergencies.

Additionally, in March 2022, the interoperability startup Health Gorilla raised USD 50 million in a Series C round led by SignalFire, including Epsilon Health Investors, IA Capital, and Nationwide Ventures. Thus, the increase in healthcare spending is expected to increase investment in IT and healthcare interoperability solutions, thereby driving the market.

Rising concerns over increasing healthcare costs

The objective of achieving interoperability is to optimize the efficiency of healthcare delivery, enhance patient-centric approaches, and mitigate the financial burden associated with healthcare expenditures. Healthcare interoperability solutions are key to overcoming some of the sector's most challenging problems and promise to lower healthcare costs significantly. Interoperability solutions help health systems reduce costs and medical errors by seamlessly sharing health data among providers, payers, labs, etc.

Patient outcomes are improved, care delivery is streamlined, and financial performance is enhanced when interoperability solutions are scaled across a health system. According to the study titled "Value of the Electronic Medical Record for Hospital Care: Update From the Literature," published in the JMIP publication in December 2021, the adoption of the HER interoperability solution reduced the 56% decrease in healthcare costs. Thus, the rising concern about increasing costs is anticipated to drive the healthcare interoperability solution as it greatly reduces healthcare costs.

Global healthcare interoperability solutions market restraint

Shortage of skilled healthcare it professionals

With the rise in demand for skilled software developers, IT healthcare based outside of the country is rapidly expanding its operations worldwide. However, the shortage of these workforces restrained the market over the forecast period. As per a report published in February 2020, titled 'Challenges in Cloud Transformation Survey,' the shortage of trained personnel is a leading corporate concern, with 86% of respondents stating that it may continue to slow down cloud projects.

As per the Tholons Services Globalization Index 2019, more than 120,000 IT specialists graduate annually from the country's tech universities, but fewer people get jobs. This has further restrained the establishment of IT solutions in healthcare and hampered the healthcare interoperability market.

Global healthcare interoperability solutions market opportunities

Advancements in real-time data exchange software technology

Software interoperability is the capacity of different solutions to freely and easily communicate with one another. Interoperable systems exchange data in real-time without requiring specialized IT assistance or code behind the scenes. It could be as easy as integrating a customer relationship management (CRM) system with automation software to generate a data flow between sales and marketing.

The team may implement an entire technology stack of interconnected applications that communicate data to streamline procedures. Software interoperability is intended to eliminate data silos. This becomes more crucial as the number of platforms and applications used increases. HL-7 FHIR, big data, deep interoperability, and EHR integration are market trends. Such advancements are expected to create opportunities for market growth.

Regional Analysis

North America Dominates the Global Market

Based on region, the global healthcare interoperability solutions market is bifurcated into North America, Europe, Asia-Pacific, South America, and the Middle East and Africa. 

North America is the most significant global healthcare interoperability solutions market shareholder and is projected to exhibit a CAGR of 13.16% during the forecast period. This is due to rising investments in the digitalization of the healthcare infrastructure, rising healthcare expenditures, and the introduction of new products. As per the Canadian Institute for Health Information's November 2021 report, the Canadian healthcare infrastructure increased from USD 267 billion in 2019 to USD 308 billion in 2021. Similarly, the United States' healthcare expenditures increased from USD 3.8 trillion in 2019 to USD 4.3 trillion in 2021. In order to control the rising cost of healthcare, the demand for healthcare interoperability solutions is expected to increase, driving market growth.

Additionally, the presence of prominent market participants in the region and business expansion initiatives like collaborations, mergers and acquisitions, and product launches, among others, are further anticipated to stimulate the market's expansion. For instance, in April 2022, Embratel introduced the Embratel Sade Interoperabilidade solution, which is suited for public and private institutions seeking to address the challenges of clinical connectivity, information integration, and sharing of medical records for a holistic view of healthcare.

Europe is expected to exhibit a CAGR of 13.52% over the forecast period. Germany offers the largest market for healthcare and life sciences products in Europe. The increasing investments have been booming in the country recently, driving the demand for hospital digitization and propelling the market's growth. For instance, in September 2020, German Health Minister Jens Spahn announced EUR 3 billion for hospitals to invest in digitization, modern emergency capacities, and IT security. The funding for projects to modernize the hospital system was provided under the hospital future fund (KHZF) from the health fund's liquidity reserve, and this covered 70% of projects, while 30% were funded by the federal states and hospital operators, which raised a further EUR 1.3 billion. Therefore, the government investments in Germany to digitize hospitals are anticipated to drive market growth.

Asia-Pacific is expected to develop at a lucrative rate. China, India, and Japan are the leading revenue contributors to the region. The market participants in the region are focused on launching new products, which is further anticipated to drive the market's growth during the forecast period. For instance, in February 2022, the Healthcare Information and Management Systems Society (HIMSS) announced the launch of the HIMSS Japanese Community, the first-ever digital health community for professionals in the Asia-Pacific. This community was created to enable Japanese healthcare professionals to learn, connect, and lead healthcare IT information exchange, thus driving digital health in Japan forward.

Similarly, government initiatives to digitalize the region's healthcare fuel market growth. For instance, in 2019, the Health Management Information System (HMIS) portal, a digital initiative under the National Health Mission, Ministry of Health and Family Welfare (MoHFW), was launched in five states of India.

The Kingdom of Saudi Arabia and the United Arab Emirates are widely recognized as highly developed nations within the Middle East and Africa region. These countries boast well-established healthcare infrastructure and exhibit the highest per capita drug expenditure levels. This generates a huge opportunity to grow research activities involving healthcare interoperability solutions. In May 2021, the Saudi Data and Artificial Intelligence Authority (SDAIA), represented by its inventive arm, the Center for Artificial Intelligence, and IQVIA, entered into an MoU to explore the mutually beneficial potential in the field of healthcare data in the Kingdom of Saudi Arabia. The agreement intends to improve both parties in data and artificial intelligence by fostering shared ideas and research. Such collaborations will further fuel regional market growth over the forecast period.

Segmental Analysis

The global healthcare interoperability solutions market is segmented by deployment, level, type, and end-user.

Based on deployment, the global healthcare interoperability solutions market is divided into cloud-based and on-premise. 

The cloud-based segment owns the highest market share and is expected to exhibit a CAGR of 13.85% over the forecast period. Cloud computing has been defined as utilizing remote servers instead of local servers or networks to store, manage, and process data. Therefore, using the cloud moves the data center infrastructure outside the organization. The increasing digitalization of health records in public healthcare facilities and their instant availability in electronic records in developing nations like India are boosting market growth.

For instance, a research study by Manohara M. M. Pai et al., published in the Health Services and Outcomes Research Methodology Journal in January 2021, found that the implementation of a cloud-based Electronic Health Records (EHR) system results in the error-free capture and sharing of patient data at various levels of the healthcare system and supports them in achieving national and international goals set for public healthcare. Thus, the demand for cloud-based systems is increasing due to their accuracy in handling records.

Based on level, the global healthcare interoperability solutions market is divided into foundational, structural, and semantic. 

The structural segment is the largest revenue contributor to the market and is predicted to exhibit a CAGR of 13.48% throughout the forecast period. Structural interoperability refers to the structure or format of data interchange (i.e., message format standards) in which healthcare data is uniformly moved from one system to another while maintaining the data's clinical or operational purpose and meaning. The syntax of data interchange is defined by structural interoperability. It ensures that data flows across IT systems can be interpreted at the data field level. According to the study published in Bioinformatics in December 2020, titled 'RCSB Protein Data Bank 1D Tools and Services, interoperability of polymer sequences and structural data is critical for presenting a complete picture of protein and gene characteristics and aiding in biomolecular function understanding. The rising importance of structural interoperability solutions in genomics and proteomics will drive its growth.

Based on type, the global healthcare interoperability solutions market is bifurcated into solutions and services. 

The services segment dominates the global market and is projected to grow at a CAGR of 12.73% over the forecast period. Healthcare interoperability services help integrate the various healthcare interoperability solutions in the healthcare sector. An article titled "HHS Proposes Steps toward Health Data Interoperability CMS and ONC Proposals Would Implement Cures Act presented in the Journal of Pharmacy and Therapeutics in June 2019, discussed the computerization of hospitals and physician offices to make electronic health records (EHRs) simple to create, easy to share among providers, and simple for patients to access.

In Medicare's fee-for-service program, the Centers for Medicare and Medicaid Services launched the Blue Button 2.0 API, enabling beneficiaries to access their health claims information. Suppose the rules proposed by the Office of the National Coordinator for Health Information Technology and the Centers for Medicare and Medicaid Services are finalized without dilution. In that case, they will boost the healthcare system's progress toward interoperability. Such increases in the services included in healthcare interoperability services will likely boost market growth during the forecast period.

Based on the end-user, the global healthcare interoperability solutions market is segmented into healthcare providers, healthcare payers, and pharmacies. 

The healthcare providers segment owns the highest market share and is anticipated to exhibit a CAGR of 13.81% during the forecast period. Healthcare providers play a major part in the sector of healthcare interoperability solutions. Hospitals and healthcare institutions are the majority users of the healthcare interoperability solutions platforms to easily access patients' medical information and exchange it with other hospitals and healthcare settings. The U.S. Centers for Medicare and Medicaid Services, in its December 2021 article on "Interoperability and the Connected Health Care System," stated that CMS is focusing on making healthcare data flow more freely and securely among providers, payers, and patients by laying the foundation to augment a more connected healthcare system to provide more accessible data. CMS is working toward this goal by improving and advancing healthcare data exchange functionality to better inform decision-making for patients and their providers and support and improve patient care.

Recent Developments

• February 2023: Redox, a leader in healthcare interoperability, and Google Cloud collaborated to simplify the exchange of healthcare data, enabling organizations to make better and more timely decisions.
• July 2023: Health Gorilla, a premier provider of health information networks and interoperability, announced that Presidium Health, the leading mobile healthcare company for medically complex patients, has effectively developed its EHR data retrieval solution to power complex home care services.