The healthcare industry is one of the biggest industries in the United States, accounting for a whopping 18% of the GDP.
To put things into perspective, the US GDP in 2022 was around $25 trillion, with the medical sector accounting for approximately $4 trillion.
And with the emergence of innovations in information technology and their applications in the realm of healthcare, the industry is looking at further growth, especially in the coming decade.
Here are the 10 most important healthcare industry trends and statistics for 2023, along with some predictions for the future.
1. The global IoMT market is projected to grow at a CAGR of 15.9% from $39.3 billion in 2020 to $172.4 billion by 2030 (Source)
The healthcare industry worldwide is quickly adopting information technology.
Cloud services give prevalent health services an edge, and rapid advancements in IT are bound to boost adoption of the internet of medical things (IoMT).
The global IoMT market is projected to more than quadruple within a span of 10 years. It was valued at less than $40 billion in 2020 and is expected to reach over $170 billion by 2030.
The ability of IoMT devices and services to facilitate the exchange of patients’ vital information without human interaction will be instrumental in the expansion of the market.
Development of sophisticated 5G networks globally will be another contributing factor for the growth since internet connectivity is essential for exchange of IoMT-mediated health services.
For more information, you can check out a research paper published by Biswajit Bhattacharya, Infosys, on 5G and IoMT: Moving Towards Modernization of Healthcare.
Pandemic-inspired digital transformation in the medical sector is being seen as an opportunity by both government bodies and big private players looking for an entry into the IoMT healthcare space.
Expect increased government efforts and private investments in the coming years, which will further propel the adoption rate.
The smart wearable segment is set to be the most dominant in the IoMT space in the coming decade.
Even before the pandemic, smart wearables had acquired a sizable market. It has been gaining rapid traction among consumers, owing to the rising health consciousness post Covid and growing consumer expenditure on health and wellness products.
You can find detailed market analysis and predictions for wearable technology by product, type, application and geography here.
Homecare is another segment expected to see an exponential rise in the concerned period because of the growth in the IoMT market.
Aversion to hospital visits, and growing preference among consumers in developed nations for at-home remedy for various ailments, will be the major driving factors in the proliferation of IoMT tech in the homecare sphere.
Like many industries, the healthcare sector is transitioning to automation to simplify labor-intensive processes.
The application of AI in the healthcare industry is still nascent at best, which is to be expected given the extremely nuanced nature of the sector. But AI has demonstrated revolutionary potential in assessing patients’ medical profiles and coming up with data-backed insights regarding the treatment.
Artificial intelligence (AI) currently has the capacity to save the US economy approximately $150 billion annually and is expected to create 400,000 new jobs by 2035.
The market valued at $6 billion is growing rapidly, owing to the increase in demand for machine learning-based solutions in the health sphere. It is expected to multiply more than 15 times in 8 years, projected to reach $95.65 by 2028.
Potential applications include virtual nursing assistants, robot-assisted surgery, dosage error reduction, fraud detection, clinical trial participant identifiers, administrative workflow assistance, and preliminary diagnosis.
Although the US is currently the major market for AI in the healthcare sector, Asia-Pacific is the fastest growing market for AI-enabled healthcare. This is due to rising demand for error-free diagnosis and treatment at dramatically reduced costs.
You can read more about the future of AI in the Asia-Pacific healthcare market in this report.
Telemedicine had a market valuation of over $71.5 billion in 2022. It’s expected to show a growth of 12.5% CAGR to attain a valuation of $244.21 billion in the forecast years 2023-2032.
The pandemic has strengthened the case for telemedicine, with telehealth offering a bridge to healthcare and reducing burdens on emergency rooms and hospital staff in times of crisis.
The increase in the adoption rate of telemedicine is proportional to the number of people residing in remote areas that get access to advanced healthcare.
The prevalence of communicable chronic illnesses in developing regions, coupled with a spike in healthcare costs, have compelled the digitally literate population to look to telemedicine and other novel healthcare facilities as economically feasible solutions for tackling health challenges.
Along with this, a rising geriatric population base is expected to gladly welcome home-based remote monitoring services.
Introduction of advanced healthcare IT infrastructure will prove vital for the adoption and growth rate of the telemedicine market.
Possible challenges to telemedicine becoming an everyday healthcare solution include concerns about data security and privacy. However, advancement in robust database management technologies such as the blockchain can alleviate such issues.
Walk-in clinics found in some big box stores and pharmacies can offer a better patient experience than traditional health systems restricted by insufficient resources.
These retail health clinics grew by 21.5% between 2019 and 2020, driven initially by the demand for nearby, convenient COVID-19 testing locations. This growth was sustained by their capacity to offer easily accessible, no-appointment-required, practical, and affordable quality care.
The US retail clinic industry was estimated to be worth $3.49 billion in 2022, and new retail giants are competing to join Walgreens, CVS-Aetna, Amazon, Optum-UnitedHealth Group, and Walmart in offering these services.
As retail health clinics double their presence in the primary care market, pressure will be on health systems to improve patient experience.
5. The global RPM tools market was worth $4.4 billion in 2022 and is projected to grow at a CAGR of 18.5% (Source)
The demand for remote patient monitoring systems (RPM) has grown as a result of the improved chronic disease management offered by these accurate and easily accessible tools.
Chronic diseases are responsible for 90% of annual healthcare costs in the US.
This can be prevented if patients receive immediate assistance via a remote monitoring system with enhanced early warning indicators and progress trackers.
Modern individualized RPM software offers a communication platform for remote and in-person patients.
The RPM tools market has expanded its reach to include special monitors and vital sign monitors that detect symptoms of numerous diseases, including:
- Cardiovascular diseases
- Sleep disorders
Continuous glucose monitoring (CGM), necessary for patients with diabetes, became the top application segment in 2022. It contributed over 13% of the total RPM revenue share and is expected to reach $16.33 billion by 2030, growing at a CAGR of 11.5%.
The monitoring segment for detecting cardiovascular diseases and hypertension is anticipated to grow at a profitable rate throughout the projection period due to the rising prevalence of those medical conditions.
6. The blockchain in healthcare market is expected to reach $14.25 billion globally by 2032 at a CAGR of 34.02% (Source)
Blockchain is a booming technology with implications that reach far outside the field of finance.
Corruption and mismanagement of databases have been problems in virtually every industry, and the healthcare sector is no stranger to them.
Rising frequency of data breaches and the related costs have driven the adoption of blockchain technology in the healthcare industry.
The global blockchain in healthcare market was valued at about $.76 billion in 2022, but it is estimated to expand about 20 times to reach $14.25 billion by 2032.
Patientory IncIBM, Oracle, BlockPharma, and BurstIQ are some of the prominent players in blockchain technology in the market today.
This speech given by the Patientory CEO about how new blockchain solutions can solve old healthcare problems is worth reading.
The increase in disease variations and treatment procedures generates a copious volume of data, which further enhances the need for a robust data management service.
Since blockchain technology is essentially a data-preservation technique, it has the potential to reduce operational costs caused by inaccuracies due to source-destination mismatch.
It enables pharmaceutical companies to enhance interoperability with internet of things (IoT) devices. It also assists them in regulating the drug supply chain and recruiting participants for clinical trials.
Although still in early phases, the growth of the industry will be accelerated by healthcare data privacy restrictions and norms, new startups, and technological collaborations.
7. The global genomics market is projected to expand to $98.7 billion in 2030 at a CAGR of 16.85% (Source)
Genomics is an exciting and fast-developing branch of medical science. The size of the worldwide genomics market was estimated to be $24.3 billion in 2021 and is expected to reach $72.28 billion in 2028. It’s projected to further increase to $98.7 billion by 2030, growing at a CAGR of 16.85% from 2022 to 2030.
One of the key drivers fueling the expansion of the genomics industry is an increase in government funding for research, especially in the fields of advanced microbiology and genetics.
The massive influx of new market participants and several startups is further accelerating the sector’s expansion.
Biotech companies and genetics-focused startups are making significant contributions to the advancement of next-generation sequencing technologies.
As technology advances, the use of genomics and the products derived from it will increase. The genomics industry is looking to develop a number of significant applications, including in drug discovery and development, precision medicine, agriculture, and animal research.
8. The market size of 3D printing medical devices is expected to reach $9.79 billion by 2031 with a CAGR of 16.1% (Source)
3D printing allows medical devices to be customized for individual patients’ bodies. This is becoming more commonplace, and the market continues to grow.
Surgical centers are anticipated to be the major driving force behind the expansion of 3D printed devices in the healthcare market in the forecast period of 2023-2031.
Rapid adoption of technological advancements such as portable and multi-material printers is another factor. These give medical practitioners greater maneuverability in designing patient-specific implants.
Increase in public-private funding in the past few years in the sector, especially for R&D purposes, has also been a contributing factor.
A rising number of cases of osteoarthritis and similar ailments pertaining to the musculoskeletal system is a major demand-booster for 3D printing technology.
3D printing enables orthopedic surgeons to reproduce a patient’s joints and other vital parts with greater accuracy than traditional manufacturing processes. This facilitates a comprehensive improvement of the patient’s condition, which would not be possible otherwise.
The global market demand can be classified into orthopedic and cranial implants, dental restorations, surgical instruments, tissue fabrications, and custom prosthetics.
A lack of skilled workforce in the 3D modeling field seems to be the main limiting factor in the expansion of the sector. However, advancements in AI are promising and 3D printing is one of the few medical domains where AI can be relied upon to do a human’s job.
Inflation is pushing prices higher, and healthcare is no exception. Health spending per person is expected to rise significantly by 2050.
According to the Centers for Medicare and Medicaid Services, national healthcare expenditure in the US reached $4.3 trillion in 2021 and is set to reach $6.2 trillion by 2028 if current trends continue.
Deloitte claims that in addition to the economic disruption owing to the pandemic, the inequities and biases tracing back to socio-economic disparities caused by racial discrimination are to blame for the current spike of federal and state expenditure in healthcare.
Medical providers in the US are reimbursed based on quantity of care, not quality. This encourages the practice of ordering redundant testing and overtreatment, which reduces the potential for improved health for patients.
The primary reason this problem persists is the fact that the US medical system is not integrated. The lack of coordination between medical providers, medical insurers, and the government leads to duplicate tests and repaying for the same prescriptions multiple times.
The US population’s unhealthy diet composition is no less to blame. According to the Centers for Disease Control (CDC), more than 50% of the US population has at least one chronic health condition as a consequence of obesity. These include asthma, diabetes, and high blood pressure — all of which are drivers of high insurance costs.
10. Economic downturn and consumer behaviors will increase hospital bankruptcies by 33% in 2023 (Source)
Bankruptcy filings among healthcare organizations with liabilities over $10 million were tracking 28% higher in 2022 than the previous year. In 2021, only 25 middle and large market healthcare organizations filed for Chapter 11. However, when research from Gibbons Advisors was released there were a total of 16 bankruptcies filed in Q1 and Q2 of 2022, tracking to hit 32 bankruptcies by the end of the year. You can download the full report here.
This follows a 44% drop in bankruptcies among large healthcare organizations from 2020 to 2021, from 45 to 25. In 2019 there were 51.
While the road ahead for the retail healthcare market looks promising, it appears bankruptcies in the core hospital industry are returning to pre-Covid rates and may continue to rise. Forrester Research Inc. projects hospital bankruptcies will increase by a third this year.
The hospital industry has already been constrained by numerous bottlenecks such as shortages in skilled workforce, compounding patient volumes, skyrocketing pharma prices, and the pandemic. These hammered the final proverbial nail in the coffin.
These economic hurdles have added to the declining credibility of hospitals. This is due to an alarming spike in hospitals’ sensitivity to recession-induced bankruptcies, coupled with systemic inequities within the primary hospital industry.
Low financial reserves and over-dependency upon state and federal aid pose an immediate risk of closure for more than 30% of rural hospitals.
Another factor inhibiting hospital growth is the emergence of retail health clinics as the preferred source for primary healthcare needs.
Moreover, the tremendous popularity of remote patient monitoring tools and services is another dominant matter of concern for the core hospital sector.
These shifts in the healthcare landscape do not seem to bode well for the hospital industry. As an enterprise, it must look for ways to balance costs and service quality.
Healthcare industry trends and statistics point to substantial growth among emerging technology in the healthcare sphere in the coming decades.
From the use of artificial intelligence to teams empowered by a robust healthcare CRM that improves operational efficiency and connects people, data, and processes, we’re seeing the beginning of where technology can take healthcare.
The world today is healthier overall than it was a century ago, courtesy of technology. However, the mission to provide optimum health services will require diligent efforts on multiple fronts. This will involve the major players in the market.
The pharmaceutical industry, the health insurance sector, and the primary hospital industry must be cognizant of that fact. On the other hand, the enterprise aspect of the healthcare industry can’t completely be forgotten for the sake of philanthropy.
Above all, they must ensure that the market they create caters to the population of every socio-economic background, preventing disparities from becoming an obstacle to healthcare for everyone.