U.S. Healthcare Industry Races Toward Digital Future

Rhea-AI Summary

Healthcare providers and insurers in the U.S. are embracing digital transformation with a focus on digital health tools, as per the latest ISG Provider Lens™ report. The report highlights the increased use of EHRs and patient-facing apps to improve care quality and efficiency.

Insights

Healthcare Technology Analyst

Healthcare providers and insurers are leveraging digital health tools to improve care delivery. This shift towards integrated electronic health records (EHRs) and patient-facing apps represents a significant investment in technology infrastructure. The emphasis on efficiency, accessibility, and quality of care is indicative of the sector's response to increasing healthcare costs and the demand for better patient outcomes.

From an industry perspective, the adoption of EHRs and digital tools can lead to cost savings by reducing administrative burdens and preventing medical errors. In the long term, the use of data analytics and personalized health information could reduce hospital readmissions and enable preventive healthcare, further decreasing costs. However, the initial capital expenditure and ongoing maintenance costs for these systems can be substantial, potentially impacting the financial performance of these companies in the short term.

Moreover, the integration of such technology requires robust cybersecurity measures to protect sensitive patient data, which could pose additional costs and challenges. The interoperability between different providers' systems is also crucial to ensure seamless data-sharing, which is not yet a universal standard. Companies that can navigate these challenges effectively may gain a competitive advantage.

Market Research Analyst

The trend towards digital transformation in healthcare is creating new opportunities for technology vendors and service providers. The demand for digital health solutions is likely to spur growth in the healthcare IT market, with potential benefits for companies that offer these technologies. The report suggests that the trend is not a fleeting one but part of a broader modernization wave.

As healthcare companies increasingly adopt these digital tools, there will be a growing market for customized software solutions, data analytics services and patient engagement platforms. Companies that are first movers in providing interoperable and secure digital health solutions could capture significant market share. This could result in an uptick in mergers and acquisitions within the healthcare IT space as companies look to enhance their capabilities and expand their offerings.

Investors should monitor the performance of companies in the digital health space, as well as those healthcare providers and insurers that are early adopters of these technologies, as they may see improved efficiency and patient satisfaction scores which could translate into financial performance over time.

Healthcare Industry Consultant

The report underscores a strategic pivot in the healthcare industry towards GenAI, or next-generation artificial intelligence, which is poised to become a major trend. This indicates a move beyond basic digitalization towards more advanced, predictive analytics and personalized medicine. The integration of AI into healthcare could revolutionize patient care by enabling more accurate diagnoses, personalized treatment plans and even real-time health monitoring.

However, the adoption of AI in healthcare also raises questions regarding the accuracy of AI algorithms, the ethical use of patient data and the need for a skilled workforce capable of operating complex AI systems. Healthcare organizations must navigate these issues while also managing expectations of stakeholders, including patients, providers and investors.

Long-term, those organizations that can successfully integrate AI and digital health tools while addressing these concerns may achieve a sustainable competitive advantage, leading to improved patient outcomes and potentially better financial performance as a result of increased efficiency and patient loyalty.

Healthcare providers and insurers look to digital records and tools to boost quality and efficiency, with GenAI emerging as next major trend, ISG Provider Lens™ report says

STAMFORD, Conn.--(BUSINESS WIRE)-- Healthcare companies in the U.S. are sharply focused on digital transformation and adoption of digital health tools, according to a new research report published today by Information Services Group (ISG) (Nasdaq: III), a leading global technology research and advisory firm.

The 2023 ISG Provider Lens™ Healthcare Digital Services report for the U.S. finds that healthcare providers and health insurance companies are increasing their use of digital health tools to enhance the efficiency, accessibility and quality of care. Through integrated electronic health records (EHRs) and patient-facing apps, organizations are monitoring patients more closely, streamlining data-sharing among providers and delivering personalized wellness information to patients.

“A powerful wave of modernization is transforming the U.S. healthcare industry,” said Bob Krohn, partner, Healthcare, for ISG. “As knowledge grows about the social determinants of health, companies are using technology to improve health equity and focus more closely on outcomes.”

Providers and insurance companies are working together to identify the most vulnerable individuals and engaging with communities, homes and workplaces to promote behavioral changes that can improve overall health, the report says. EHRs, machine learning and predictive analytics play critical roles in this process.

Using advanced data models and algorithms, combined with social determinants of health, providers are taking a more holistic and personalized approach to care, including earlier diagnoses and better prevention, ISG says.

A growing number of providers and insurance companies in the U.S. are partnering to provide more cost-effective services, especially under Medicare, the report says. In value-based care focused on outcomes, health systems play a more active role in risk management and incentives to prioritize quality over quantity. This approach is helping providers gain a competitive edge and pursue growth opportunities.

Generative AI (GenAI) is emerging as the next major wave of technology to be adopted in the industry, with many providers committing to major investments in the next five years to develop GenAI solutions, ISG says. These could include GenAI copilots to reduce workloads and ease clinician burnout.

“In the next two years, ISG expects GenAI to have such a broad impact on healthcare technology and economics that every active project will be re-assessed,” said Jan Erik Aase, partner and global leader, ISG Provider Lens Research. “Technology service providers are preparing to help enterprises navigate these changes.”

The report also explores other healthcare technology trends in the U.S., including the rise of integrated health platforms and growing demand for electronic medical record migration services.

For more insights into the challenges facing U.S. healthcare enterprises, including talent shortages and integration of new and existing technologies, plus advice on how to address them, see the ISG Provider Lens™ Focal Points briefing here.

The 2023 ISG Provider Lens™ Healthcare Digital Services report for the U.S. evaluates the capabilities of 39 providers across three quadrants: Payer Digital Transformation Services, Provider Digital Transformation Services and Healthcare Platform Implementation Services.

The report names Accenture, Cognizant, HCLTech, Infosys, NTT DATA, Optum, TCS and Wipro as Leaders in all three quadrants. It names Deloitte and EXL as Leaders in two quadrants each. Atos, Firstsource, IBM, LTIMindtree, Tech Mahindra and UST are named as Leaders in one quadrant each.

In addition, CitiusTech and Persistent Systems are named as Rising Stars — companies with a “promising portfolio” and “high future potential” by ISG’s definition — in one quadrant each.

A customized version of the report is available from EXL.

The 2023 ISG Provider Lens™ Healthcare Digital Services report for the U.S. is available to subscribers or for one-time purchase on this webpage.

About ISG Provider Lens™ Research

The ISG Provider Lens™ Quadrant research series is the only service provider evaluation of its kind to combine empirical, data-driven research and market analysis with the real-world experience and observations of ISG's global advisory team. Enterprises will find a wealth of detailed data and market analysis to help guide their selection of appropriate sourcing partners, while ISG advisors use the reports to validate their own market knowledge and make recommendations to ISG's enterprise clients. The research currently covers providers offering their services globally, across Europe, as well as in the U.S., Canada, Brazil, the U.K., France, Benelux, Germany, Switzerland, the Nordics, Australia and Singapore/Malaysia, with additional markets to be added in the future. For more information about ISG Provider Lens research, please visit this webpage.

A companion research series, the ISG Provider Lens Archetype reports, offer a first-of-its-kind evaluation of providers from the perspective of specific buyer types.

About ISG

ISG (Information Services Group) (Nasdaq: III) is a leading global technology research and advisory firm. A trusted business partner to more than 900 clients, including more than 75 of the world’s top 100 enterprises, ISG is committed to helping corporations, public sector organizations, and service and technology providers achieve operational excellence and faster growth. The firm specializes in digital transformation services, including automation, cloud and data analytics; sourcing advisory; managed governance and risk services; network carrier services; strategy and operations design; change management; market intelligence and technology research and analysis. Founded in 2006, and based in Stamford, Conn., ISG employs more than 1,600 digital-ready professionals operating in more than 20 countries—a global team known for its innovative thinking, market influence, deep industry and technology expertise, and world-class research and analytical capabilities based on the industry’s most comprehensive marketplace data. For more information, visit www.isg-one.com.

View source version on businesswire.com: https://www.businesswire.com/news/home/20240209806707/en/

Press Contacts:

Will Thoretz, ISG

+1 203 517 3119

will.thoretz@isg-one.com

Julianna Sheridan, Matter Communications for ISG

+1 978-518-4520

isg@matternow.com

Source: Information Services Group, Inc.

FAQ

What is the focus of healthcare companies in the U.S. according to the ISG Provider Lens™ report?

Healthcare companies in the U.S. are focused on digital transformation and adoption of digital health tools.

How are healthcare providers and insurers using digital health tools to enhance care quality?

They are using integrated electronic health records (EHRs) and patient-facing apps to monitor patients closely, streamline data-sharing, and provide personalized wellness information.

Who published the 2023 ISG Provider Lens™ Healthcare Digital Services report for the U.S.?

Information Services Group (ISG) published the report.

What impact is modernization having on the U.S. healthcare industry according to Bob Krohn?

Bob Krohn mentioned that a powerful wave of modernization is transforming the U.S. healthcare industry.