Practice Management System Market size was valued at USD 14.1 billion in 2023 and is expected to cross USD 48.6 billion by the end of 2036, expanding at more than 10.8% CAGR during the forecast period i.e., between 2024-2036. In 2024, the industry size of practice management systems is evaluated at USD 15.5 billion.
Practice management software (PMS) is being increasingly integrated with AI. National Institute of Health predicted in March 2020, that 5% of adults were affected by outpatient environments along with 17% of diagnostic errors resulting in adverse events in hospital settings.
This demands an upgrade in current medical institutions and various practices such as primary health care (PHC) services. Several practice management automators (PMAs) such as Medicodio, Aiwyn, and XBert have gained immense popularity. XBert an AI-powered work intelligence, is a PMA that helps in report analytics, client portals, and workflow automation. In addition, electronic data in healthcare IT has been massively produced since the advent of PMS to cater to patient care, regulatory compliance, and record-keeping. This necessitates the usage of a PMS as it saves resources, and time while providing a high ROI in processes such as administrative tasks and billing.
Growth Drivers
Challenges
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Base Year |
2023 |
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Forecast Year |
2024-2036 |
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CAGR |
10.8% |
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Base Year Market Size (2023) |
USD 14.1 billion |
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Forecast Year Market Size (2036) |
USD 48.6 billion |
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Regional Scope |
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Product Type (Integrated, Standalone)
The integrated segment in the practice management system market is poised to capture a share of 74.1% in the coming years. Significant growth in the revenue share is anticipated as a result of the benefits it offers such as EHRs, patient engagement, e-prescription, billing systems, and streamlined practitioners. For instance, in May 2023, MEDITECH Software announced an agreement to integrate with Canada Health Infoway's "PrescribeIT" e-prescribing service. Through this agreement, Canadian prescribers could electronically send a prescription to the patient's preferred pharmacy straight from MEDITECH's Expanse EHR. Furthermore, the healthcare industry's centralization and the complexity of patient care and payment will also drive the segment growth.
Component (Software, Service)
By 2036, software segment in the practice management system market is estimated to cross USD 23.1 Billion. This growth is propelled by their easy installation which allows professionals to effectively manage financial administrative, as well as clinical workflows. Hospitals, medical providers, and health systems use them to improve patient satisfaction and care quality. Software is also used by small and medium-sized medical offices to automate and streamline business-related processes. Additionally, in July 2024, the Agency for Healthcare Research and Quality (AHRQ) stated that whether or not a patient's expectations for a medical interaction were fulfilled determines patient satisfaction. Patient satisfaction is taken into consideration in various value-based care compensation models, such as the Inpatient Prospective Payment System (IPPS).
Our in-depth analysis of the practice management system market includes the following segments:
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Product Type |
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Component |
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Mode of Delivery |
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End use |
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North America Market Statistics
The practice management system market in North America is set to hold the largest share of 46.9% during the forecast period. The surging digital literacy and high patient awareness, coupled with technological advancements in the healthcare sector drive the growth of PMS in this region. According to a report by Research Nester in 2022, in the U.S., 74% of consumers said they would use telemedicine. This will demand for proper management and storage of their data and demands PMS in the forecast period.
Government funding in Canada will change the adoption of medical practice management by healthcare providers. For instance, Canadian Medica Association Journal 2023, stated that with USD 46.2 billion in additional funding to increase health care budget by USD 196.1 billion over the next ten years.
In the U.S., practice management systems help manage insurance information, appointment scheduling, patient records, and other aspects of the healthcare industry. In a recent report published by Research Nester in 2021, about 61% of respondents wish to have access to their medical records via an online patient portal or mobile apps from their EHR providers.
Asia Pacific Market Analysis
Asia Pacific will also encounter huge growth in the practice management system market share during the forecast period with a notable size. This region will account for the second position in this landscape owing to the demand for PMS to effectively manage patient data as chronic diseases such as cardiovascular diseases (CVD), and gastrointestinal disorders are at a surge. American College of Cardiology in 2021 stated that Asia witnessed an increase in CVD mortality from 5.6 million to 10.8 million in 2019. Nearly 39% of these deaths from CVD occurred in people under the age of 70, compared to the U.S., where the percentage of premature CVD deaths was 23%.
There is a high demand for high-quality healthcare in China owing to the increasing geriatric population. The National Institute of Health 2023 estimated that health expenditures constitute about 6.5% of China’s GDP, while the number of hospitals in China witnessed a growth rate of 193.4% by 2021.
In Japan, the demand for healthcare IT companies is increasing led by the growing economic conditions in this country. International Trade Administration 2022, predicted that by 2025, the telemedicine market in Japan is observed to grow from USD 243 to 404.5 million between 2020 and 2025.
Practice management system market expansion is predicted to witness a lucrative share during the forecast period. The competitive environment is attributed to the tremendous spike in the usage of AI in PMS coupled with the shift to EHR globally. More companies are entering this sector owing to the potential growth opportunities. In the forecast period, the market will observe emerging competitors and a growing demand for practice management systems around the world.
Some of the key players include:
Author Credits: Abhishek Verma
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