Artificial Intelligence in Healthcare Market Size

AI in Healthcare Market Analysis

The artificial intelligence in the healthcare market is expected to register a CAGR of 42.2% during the forecast period.

The COVID-19 pandemic increased the demand for artificial intelligence (AI) in healthcare. This is due to the increasing demand for AI-based tools and solutions that can evaluate and diagnose COVID-19. According to a study published by Intelligence Medicine in May 2021, artificial intelligence (AI) has aided in addressing challenges and accelerating progress in mitigating this public health crisis. It has been used in applications ranging from outbreak forecasting to patient management and drug/vaccine research.

AI-based techniques are widely used in four areas: patient tracking and monitoring, screening and diagnosis, characterization and severity evaluation, and prognostic prediction in COVID-19 patients. Additionally, according to the study published in MDPI Diagnostics in November 2022, AI systems are beneficial for complex medical diagnoses that traditional statistical methods cannot manage. Models that auto-regulate, recognize, segment, and classify COVID-19 data are utilized in AI for screening and diagnosing COVID-19. Thus, the pandemic positively influenced the studied market. Currently, the market is predicted to develop further over the forecast period, as demand for AI in healthcare is expected to rise due to the increased prevalence of chronic diseases and the use of AI in their management.

The market is primarily driven by the growing need to reduce healthcare costs, utilization of big data in healthcare, the ability of AI to improve patient outcomes, and the ever increasing importance of AI-assisted robotic surgeries. For instance, according to a study published in the International Journal of Environmental Research and Public Health in January 2021, more than 60% of hospitals globally had incorporated IoT in their facilities. It also stated that "AI applications could generate up to USD 150 billion in yearly savings for United States healthcare by 2026." By 2021, hospitals planned to invest USD 6.6 billion annually in AI-related technologies. Thus, by implementing AI in healthcare, healthcare costs can be reduced, driving demand for AI in healthcare over the projected period.

Additionally, the rising application of big data in healthcare, as well as strategies to bring the big data system into healthcare are expected to support market expansion. In March 2022, the government of Thailand launched a big data portal for healthcare facilities. The National Reform Committee on Public Health recently joined hands with 12 government agencies to improve the quality of healthcare services through the implementation of digital technologies. Similarly, in March 2022, Microsoft launched its Azure Health Data Services. It is a Platform as a Service (PaaS) offering designed exclusively to support protected health information (PHI) in the cloud.

Furthermore, the introduction of an advanced technological products by the market players is expected to propel the growth of the market. In September 2022, AGS Health, a revenue cycle management (RCM) solutions provider, announced the launch of the AGS AI Platform, a connected solution that combines artificial intelligence (AI) and automation with award-winning human-in-the-loop services and professional support to maximize revenue cycle performance.

Additionally, in March 2022, Health Catalyst, Inc. announced the new Healthcare.AI launch. Created to address healthcare business opportunities and challenges across revenue, cost, and quality, Healthcare. AI suite of augmented intelligence (AI) products and services will significantly expand AI's effective use and use-cases in healthcare. In March 2022, NVIDIA Corporation launched Clara Holoscan MGX, a device that is used to accelerate innovation in the medical industry. It uses real-time AI.

Thus, all the above-mentioned factors, such as the growing need to reduce healthcare costs and product launches by the market players, are expected to boost the market over the forecast period. However, reluctance among traditional practitioners to adopt AI-based technologies may restrain the market growth.