IT spending in India’s healthcare industry is expected to grow from US$ 274.2 million in 2009 to US$ 609.5 in 2013, growing at a Compounded Annual Growth Rate (CAGR) of 22% from 2009-2013, says the latest “IT in the Healthcare Industry - Emerging Trends and Market Opportunities in India” report from Springboard Research.
The report also shared that hardware accounted for the largest proportion of total IT spending in the healthcare vertical with 55% share, followed by software and IT Services at 25% and 20% respectively in 2009.
“The spending on basic computing products is expected to increase over the next five years, as hospitals build and upgrade their IT infrastructure”, notes Tulika Sheel, analyst, Vertical Industries at Springboard Research. “Moreover, with new and upcoming applications such as telemedicine and e-prescriptions penetrating the healthcare vertical in India, IT investments on software would further increase with a focus on integrated billing and online availability of patient records across hospitals.
Cloud Computing/ SaaS Adoption
In addition, the report found that 23% of the healthcare respondents who currently use or plan to use Cloud Computing cited “reduced hardware infrastructure costs” as well as “simplified resource and server provisioning” to be the primary reasons for adoption.
However, though Cloud/ SaaS applications help healthcare enterprises in reducing their operating costs, the high initial investment, integration with existing systems and lack of knowledge hinder their adoption.
Healthcare Information System (HIS) Drives Investment
According to the report, HIS is the largest IT solution implemented for healthcare which drives the majority of the tier 1 private enterprise investments. As high as 94% of respondents cited implementing HIS while 85% of the respondents mentioned having invested on clinical information system, patient management system and laboratory information.
Consolidation of IT System is the Primary Concern
The Springboard Research report cites consolidation of IT systems as the top most pain point in the healthcare space. Process Automation and Business Alignment, Integration (within and outside of the organization), is a pain point which IT departments are struggling to tackle and is well reflected among 28% of the respondents who confirmed consolidation as the primary pain point, outweighing concerns over data management and storage as well as growing data volumes.
“Vendors in the healthcare vertical should look to offer industry-specific solution including back-end and front-end applications and involve clinical members to actively participate and understand the solution and its impact on the hospitals for better clinical services” advises Nilotpal Chakravarti, research manager, Vertical Industries at Springboard Research.
Commenting on the opportunities for IT solution providers, he noted that “IT solution providers in this space must also start focusing on the blooming opportunities in tier 2 and tier 3 cities as there will be a high demand for quality healthcare services in these cities and healthcare providers will start looking for low cost models and high patient turnover models”.
According to the Springboard Research report, IBM, Dell Services and SAP are some of the key players active in the healthcare space in India whereas Siemens Information Systems Pvt Ltd and Religare Technologies Ltd are identified as the emerging vendors in this space.
