Healthcare analytics gained prominence since past few years as number of new companies have emerged that offer specific analytical tools that use statistical, contextual, quantitative, predictive, cognitive tools to analyze the huge chunks of data that is generated by healthcare companies. Huge amounts of data are being generated by healthcare companies that need to be analyzed for efficient decision making by the managers. Healthcare analytics uses statistical tools and techniques to analyze healthcare-related data in order to analyze operational performance or clinical outcomes to improve the quality and efficiency of clinical and business processes and performance. The global market is estimated to be $4.43billion in 2013 and is expected to reach $21.35 billion by 2020, at a CAGR of 25.2%. Growth is mainly driven by predictive analytics and prescriptive analytics in the U.S. and Asia, according to a report provided by MarketsandMarkets, a global market research and consulting company. Data analytics particularly the big data analytics is a very important strategic advantage for the company as the companies can look at improving the processes and also design products and services that best suits the needs of the consumers. New technologies like wireless technologies, sensors, mobile devices, etc. have even more fuelled the need for data analytics as more and more data is being captured and this must be used by companies for decision making. Some of the big players in this segment are IBM, Oracle, SAS, etc. Many small and start-ups are also coming focusing particularly on the healthcare analytics segment.
Healthcare analytics is being aggressively adopted by both payers (insurance companies) and providers (hospitals) and some of the most important functions include improving the accuracy of diagnoses, cost reduction, fraud prevention, revenue generation, service improvement to real-time view of the business. The major driver for business analytics is the return on Investments (ROI), with a median of five years, from 10% to 1,000%, according to a report provided by MarketsandMarkets, a global market research and consulting company. The global market is dominated by the U.S., followed by Europe, Asia, and the Rest of the World. The U.S. will continue to lead the global market till 2020. Apart from the U.S., the Asian region is also expected to drive the market growth. The European market is the second largest market, growing at a lower rate due to the economic crisis. Governments are also incentivizing the companies that are adopting the data analytics tools and also using such tools in the decision making. Governments across the globe spend trillions of dollars on healthcare and they are looking for ways and means of reducing the cost or looking for significant value from their healthcare investments. Despite the advantages there are certain issues and challenges related to healthcare analytics like as data security issues, patient data confidentiality, doctors and hospitals lack of interest in IT adoption, and lack of skilled professional cross-functional analytical skills in medicine, statistics and IT.