Healthcare outsourcing to balloon to $380Bn in 2024 – study

ONTARIO, CANADA — A study by Precedence Research forecasts the healthcare outsourcing industry’s market size to reach $380.62 billion in 2024 due to rising demand for expertise and equipment amid scarce resources.

Published in November, the study noted that the U.S. hospital outsourcing market is pegged to reach $154.25 billion in 2024. 

The Middle East is forecasted to expand with the largest compound annual growth rate (CAGR) between 2023 and 2032. The combination of affordable service costs and growing demand for state-of-the-art healthcare technologies are expected to propel growth in the region.

The report covered public and private hospitals and identified several key growth factors in the healthcare outsourcing industry. 

Since private hospitals operate on a limited budget and lack managerial efficiency, they lean towards third-party entities to aid in their day-to-day administrative tasks. It can cut costs, save on capital for infrastructure, and achieve staffing flexibility.

The increase in patient traffic amid federal guidelines for maintaining electronic medical records has also urged hospitals to avail of the services of third-party firms, particularly those specializing in cloud technologies.

As hospitals upgrade their tech systems, new challenges in cybersecurity arise. The study pointed out that there are still bottlenecks in this department that need to be addressed soon, as they could put the patients’ health at risk.

The healthcare outsourcing industry has had some key acquisitions over the last few years. In 2017, medical supplies firm McKesson Corporation bought healthcare management firm intraFusion. In 2021, healthcare outsourcing firm Omega Healthcare acquired medical coding company Himagine Solutions.

This month, private equity Warburg Pincus and Brookfield Asset Management Inc. completed its $1 billion investment in healthcare services outsourcing firm Everise.