Updated date - Dec 12, 2019

MarketsandMarkets forecasts the healthcare EDI market to grow from USD 2.56 billion in 2017 to USD 3.77 billion by 2022, at a Compound Annual Growth Rate (CAGR) of 8.1% during the forecast period. The major factors that are expected to be driving the healthcare EDI market are the development of regulations for transaction processes, the rising need to curtail healthcare costs, and government support for HCIT implementation. In addition, the need for the efficient management of electronic claims and reimbursement transactions (for healthcare providers) is expected to drive demand growth in the healthcare EDI market during the forecast period. The objective of the report is to define, describe, and forecast the healthcare EDI market size based on component, delivery mode, transaction type, end user, and region.

By delivery mode, mobile EDI segment is expected to grow at the highest growth rate during the forecast period

Among the delivery mode, segment, the mobile EDI segment is expected to grow at the highest CAGR during the forecast period. The factors attributing to the high growth of this segment include the technological upgrades in the healthcare industry and growing acceptance of mobile solutions among healthcare providers.

By component, the services segment is expected to record the highest CAGR during the forecast period

The services segment is expected to witness a faster growth rate in this market due to factors such as, the increasing claims volume, increasing complexity and scale of EDI solutions, as they require extensive training programs. Similarly, a growing trend of outsourcing activities, such as revenue cycle management, claims handling and management, and partner management services, is also expected to propel the growth of the services market.

By transaction type, the claims management segment is expected to account for the largest share of the healthcare EDI market

On the basis of transaction type, the healthcare EDI market is segmented into claims management and healthcare supply chain. The claims management segment is expected to account for the largest share of the healthcare EDI market during the forecast period. The large share of this segment can be attributed to the rising adoption of EDI services by healthcare providers and payers and the need to meet regulatory requirements.

By end user, the healthcare payers segment to record the highest CAGR during the forecast period

Based on end user, the healthcare EDI market is segmented into healthcare providers, healthcare payers, medical device & pharmaceutical industries, and pharmacies. The healthcare payers segment is expected to grow at the highest CAGR during the forecast period due to the increasing number of private insurance players in the market.

North America to account for the largest market size during the forecast period.

North America is expected to hold the largest market size in the global healthcare EDI market during the forecast period, followed by the European region. The rising HCIT expenditure, developed healthcare infrastructure, broad insurance coverage, a favorable regulatory scenario, an increasing number of private healthcare players, growing demand for healthcare supply chain management solutions, and the presence of prominent healthcare IT companies in this region, are responsible for the large share of the North American healthcare EDI market.

Market Dynamics

Driver: Regulations for transaction processes

The Healthcare Insurance Portability and Accountability Act (HIPAA), passed in 1996, set up a standard for the transmission of insurance data. Prior to this act, there were 400 different medical form standards that not only made it difficult for providers and payers to process claims but also introduced many errors that made it important to implement a standard for claims management. EDI has eased the process of claims management, with the entire process being conducted electronically with software that meets the needs of HIPAA for electronic filing. The Patient Protection and Affordability Care Act, also known as the Obamacare Act, was passed in 2010 in the US The Act aimed at increasing the affordability and quality of health insurance and mandated the 834 EDI transaction for healthcare providers and payers. Its purpose is to electronically transmit enrollment and dis-enrollment information. This step is a major reason driving the adoption of EDI in the healthcare industry in the US.

Restraint: High implementation cost of EDI software

Although the adoption of healthcare EDI by healthcare providers is on the rise, the cost associated with EDI software installation is high. The major reason for this includes third-party solutions and inadequate internal systems and clearinghouses adding high costs per transaction with expensive setup fees. This will significantly affect the total cost of ownership. In developed markets across Europe and North America, the acceptance for EDI solutions has been lower among small- and medium-sized healthcare providers mainly due to the relatively high investments required for the implementation of EDI. Many small- and medium-sized healthcare providers regard tangible costs of implementation of EDI to exceed the tangible benefits, which prevents them from implementing EDI solutions.

Opportunity: Increase in outsourcing of EDI services

EDI outsourcing is the process of having a third party manage a part or the entire process of using EDI to exchange data with trading partners. Growing healthcare costs are increasingly pressurizing the healthcare industry to provide quality care at lower costs by minimizing wastages at each stage. Healthcare revenue loss in American hospitals, due to self-pay billing issues, is as high as 20% to 30%. Additionally, according to a Ponemon Institute survey in 2014, of 577 healthcare professionals, the US physicians and hospitals have shown an inability to use the latest mobile devices and internet services to deliver patient care. As a result, US hospitals absorb an estimated USD 8.3 billion annually, while struggling with security and privacy concerns arising from the mainstreaming of social media at a time when federal rules allow for steep fines when it comes to violating patient privacy. For hospitals, this makes the outsourcing of billing and claim services to EDI service providers an attractive proposition.

Challenge: End-user limitations and requirements

Despite its long-term benefits, EDI has witnessed limited success. The reason for this lies in the nature of the hospitals that use healthcare EDI and the healthcare organizations that require it. The demand side/end users are participants who are relatively small, have limited IT resources, and suffer from limited financial strength; this prevents them from adopting EDI. Unlike the retail world, in healthcare, large suppliers mandate the use and adoption of healthcare EDI. While these large vendors have the resources and budgets necessary to deploy and use healthcare EDI, the hospitals and facilities they deal with are often cash-strapped and have limited IT resources, making the adoption of healthcare EDI precarious and time-consuming. This problem of lack of resources, with mandates for solution implementation, means that finding healthcare EDI solutions that are viable can be challenging.

Scope of the Report

Report Metric Details Market size available for years 2017�2022 Base year considered 2016 Forecast period 2017�2022 Forecast units Million (USD) Segments covered By Component, Delivery Mode, Transaction Type, End User, and Region Geographies covered North America, Europe, APAC, ME&A, and Latin America Companies covered McKesson Corporation (US), GE Healthcare (US), Allscripts Healthcare Solutions Inc. (US), Cognizant Technology Corporation (US), SSI Group, LLC (US), Cerner Corporation (US), Comarch SA (Poland), Axway Software SA (France), Optum Inc. (US), Dell Technologies Inc. (US), Quality Systems Inc. (US), and Synnex Corporation (US).

The research report categorizes the healthcare EDI to forecast the revenues and analyze the trends in each of the following sub-segments:

Healthcare EDI Market, By Component

Services

Solutions

Healthcare EDI Market, By Delivery Mode

Web & Cloud-based EDI

EDI VAN

Point-to-Point EDI

Mobile EDI

Healthcare EDI Market, By Transaction Type

Claims Management Claims Submission Claim Status Eligibility Verification Payment Remittance Referral Certification & Authorization Claim Payments Others

Healthcare Supply Chain

Healthcare EDI Market, By End User

Healthcare Providers

Healthcare Payers

Medical Device & Pharmaceutical Industries

Pharmacies

Healthcare EDI Market, By Region

North America US Canada

Europe Germany UK France Italy Spain Rest of Europe

Asia Pacific China Japan India Rest of Asia Pacific

Latin America

Middle East and Africa

Key Market Players

McKesson Corporation (US), GE Healthcare (US), Allscripts Healthcare Solutions Inc. (US), Cognizant Technology Corporation (US), SSI Group, LLC (US), Cerner Corporation (US), Comarch SA (Poland), Axway Software SA (France), Optum Inc. (US), Dell Technologies Inc. (US), Quality Systems Inc. (US), and Synnex Corporation (US).

McKesson Corporation (US) dominated the global healthcare EDI market in 2016. The company has a strong presence in the market with a comprehensive range of products. It offers a wide portfolio of EDI solutions mainly through its subsidiary�Change Healthcare. The company has a strong presence in the US, followed by Canada, Germany, the U.K., and Ireland. McKesson Corporation focuses on inorganic growth strategies such as partnerships and agreements to strengthen its product portfolio as well as its market position.

Recent Developments

In March 2017, McKesson Corporation (US) and Change Healthcare Inc. (US) entered into an agreement to create a new healthcare information technology company.

In May 2016, GE Healthcare (US) and Accenture PLC (Ireland) formed an alliance to focus on improving medical claims management and help providers�large health systems, physician groups, and hospitals�understand how claims management affects financial performance.

In June 2016, Experian Health (US) launched the Denials Workflow Manager for revenue cycle management.

In August 2015, Cognizant Technology Solutions Corporation (US) entered into collaboration with New England Healthcare Exchange Network (US) to combine its consulting, IT, and business process products with NEHEN�s health information exchange for processing more than 8 million transactions every month.

In December 2015, GE Healthcare (US) launched its financial management solution such as Centricity Business 6.0.

Critical questions the report answers:

Where will all these developments take the industry in the long term?

What are the upcoming trends in the healthcare EDI market?

Which segment provides the most opportunity for growth?

Who are the leading players operating in this market?

What are the opportunities for new market entrants?

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