The global healthcare IT outsourcing market is forecast to grow at a compound annual growth rate (CAGR) of 7.6 percent, to reach $50.4 billion by 2018, up from $35 billion in 2013, according to a new RnR Market Research report.

Outsourcing of IT solutions in the healthcare industry has emerged as an efficient solution to mitigate rising healthcare costs and to meet the growing demand for quality care. Over the years, the trend of outsourcing healthcare IT solutions has grown significantly among large organizations and has also attracted mid-sized organizations. In some cases, the entire information management system is outsourced, while in others, only key application services such as implementation of EMR, CRM, and billing systems are outsourced.

Factors propelling the growth of the market are the rising pressure to curb healthcare costs across the globe and the growing need to manage cash flow in back-office administration and IT management systems of healthcare provider, payers, and the life science segment. Lack of in-house IT expertise, rise in demand for integrating solutions, growing pressure on healthcare providers to meet the government’s meaningful use criteria, new ICD-10 conversion guidelines for coding, rise in aging population, and growing medical tourism in Asia are also likely to drive the outsourcing market.

However, factors such as the fragmented nature of the healthcare system and healthcare IT outsourcing market, requirement for high investment in outsourcing IT solutions, growing concern for data security, and cultural and language barriers restrain the growth of the market.

The healthcare IT outsourcing market for this report has been segmented by application and by industry. The application market is further classified as provider IT outsourcing, payer IT outsourcing, life science IT outsourcing, operational IT outsourcing, and infrastructure IT outsourcing, while the market by industry is segmented as healthcare (including hospitals, diagnostic laboratories, and clinics), biotechnology, pharmaceutical, clinical research organizations, and health insurance.