Healthcare IT outsourcing is a growth driver for Indian IT BPO Industry.

1. Analysis & Outlook
Healthcare IT Outsourcing Market 2013-2018 – Indian IT firms competing for growth
The global healthcare IT outsourcing market is estimated to grow at a compound annual growth
rate of 7.6 percent, to reach $50.4 billion by 2018 from $35 billion in 2013, according to Markets
and Markets Research report. North America dominates the market with 72 percent market share
and is forecasted to reach $36 billion by 2018 from $25 billion in 2013. Asia-Pacific and rest of
the world are expected to register CAGRs of 8.1 percent and 7.8 percent (2013 to 2018)
respectively, followed by Europe at 7.2 percent. Major players in the market are Accenture,
Accretive Health, Inc., Allscripts Healthcare Solutions, Inc., Anthelio Healthcare Solutions,
Cognizant Technology Solutions, Dell, Inc., HCL Technologies, Hewlett-Packard Company,
IBM, Infosys Limited, McKesson Corporation, Siemens Healthcare, Tata Consultancy Services
Ltd., Wipro Ltd., Xerox Corporation, Epic System, and Computer Sciences Corporation.
Gartner estimated that spending by global healthcare providers for IT services will grow by 6 per
cent to reach $30.4 billion in 2013. Consulting, with 9 per cent growth in 2013, will be the
fastest-growing sub segment within the global healthcare provider market for IT services.
Healthcare IT spending at large North American healthcare organizations is expected to increase
to more than $34.5 billion next year, spurred by current regulatory trends and the trend is
expected to open up new markets for many vendors according to Technology Business Research
Inc.’s (TBR) new SourceIT Healthcare Report. North America (U.S. and Canada) dominate the
global healthcare information technology outsourcing market. Healthcare IT outsourcing
industry growth is attributed to ever growing need to cut healthcare costs as governments pay for
such costs and they are looking to reduce their deficits; rise in demand for applications
management services, application development, and infrastructure outsourcing for providers, life
sciences, and payers; growing population close to 30 million citizens will be added to be covered
under the insurance policy as per HIPPA Act; lack of in-house IT experts; and the new ICD 10
guidelines.
Information Technology is at the core of Healthcare Industry as the industry on the whole
generates huge amounts of data and Healthcare providers/payers need to electronically track data
related to medical records, billing codes, electronic monitoring systems, and patient care. In
order to track and manage this valuable data via electronic systems, there is a need for strong
information technology infrastructure and devices such as servers, desktops, networks, personal
digital assistants (PDAs), and laptops. Due to the lack of required skills and IT domain expertise,
maintaining IT infrastructure and services is a challenging task for the healthcare industry. The
healthcare industry, which faces the challenge of delivering the best patient care at an affordable
cost, has been opting for outsourcing IT solutions.India based players like Cognizant
Technology, HCL Tech, Infosys, TCS, Wipro are aggressively building capabilities in healthcare
IT space. Cognizant and HCL Tech are leading the pack and rest of the Indian players
aggressively trying to cash the opportunity and best way is through Mergers and Acquisitions.
But the global competition is tough too from players like Accenture, IBM, Dell, etc.
Rajesh Prabhakar
Analyst Bio @ http://analysiscasestudy.blogspot.com/