Medical Terminology Software Market Assessment, By Application [Data Aggregation, Reimbursement, Clinical Trails, Data Integration, Quality Reporting, Public Health Surveillance, Decision Support, Others], By Product Type [Platform, Services], By End-user

Medical Terminology Software Market Assessment, By Application [Data Aggregation, Reimbursement, Clinical Trails, Data Integration, Quality Reporting, Public Health Surveillance, Decision Support, Others], By Product Type [Platform, Services], By End-user [Healthcare Payers, Healthcare Providers, Healthcare IT Vendors, Others], By Region, Opportunities and Forecast, 2017-2031F

Global medical terminology software market is projected to witness a CAGR of 15.13% during the forecast period 2024-2031F, growing from USD 1.48 billion in 2023 to USD 4.57 billion in 2031F. The growth of the market is supported by increasing emphasis on reducing clinical errors, rise in the number of measures by various governments to boost the hospital IT usage, and the augmenting desire for interoperability among different medical departments.

The rapid expansion of healthcare sector in various regions across the globe and increasing efforts towards the elimination of clinical errors is bolstering the global medical terminology software market demand. According to the estimates of Invest India, the hospital sector in the country was valued at USD 95 billion in 2021 in revenue and is expected to reach the value of USD 219.7 billion by 2027, growing at a CAGR of 18.24%. The growth will propel the requirement for medical terminology software and support the expansion of the market as the software aids in delivering the medical information of the patients in a comprehensive and standardized manner.

The increasing prevalence of various diseases is propelling the burden on healthcare establishments, boosting the adoption of medical terminology software for improving operational efficiency and streamlining workflow. The need for improving patient safety by reducing medical errors is one of the major global medical terminology software market trends. The occurrence of medical errors due to inaccuracies in medical documents can severely impact the health of the patient. Medical terminology software aids in improving the quality of the clinical documents by integrating standard medical terminologies into the healthcare IT systems such as EHRs. Due to pre-coordination of medical terminologies and phrases, ambiguity gets eliminated and clarity of clinical notes is enhanced. The seamless integration of medical vocabulary and smooth data mapping reduces the misinterpretation of clinical information and enhances the safety of the patients.

Expansion of the Healthcare Sector Supports Global Medical Terminology Software Market Growth

Due to the rapid expansion of the healthcare sector in various regions across the globe, requirement for streamlining of operations, and reducing clinical errors is increasing to improve the quality of patient care. According to the estimates of the Cross River Therapy, the United States Food and Drug Administration receives 100,000 reports of medication error every year. The lack of presence of a standardized nomenclature is one of the leading causes of medical errors. Increasing emphasis on reducing clinical errors while ensuring the maintenance of standard patient information in a regulated manner is expected to provide lucrative growth opportunities to the market over the forecast period.

Furthermore, the growing efforts towards reducing healthcare costs is propelling the requirement for medical terminology software as they aid in capturing clinical data in a standardized format in a seamless manner. It in turn enhances the efficiency and accuracy of the billing processes and medical coding. Accurate coding and documentation are imperative for ensuring optimal reimbursements. The incorporation of the software into the workflow aids in minimizing revenue leakages by reducing billing errors, thus boosting the utilization in various healthcare establishments.

Government Support Towards Digitalization of Health Records Boosts the Market Size

The growing efforts by various governments to promote the digitalization of health records for improving clinical decision making and public health is positively influencing the growth of the market. For instance, the National Health Authority of India is providing various incentives to healthcare providers and other stakeholders of the digital ecosystem in the country, which are involved with promoting the creation of digital health records. Such initiatives will bolster the adoption of medical terminology software as they facilitate capturing clinical information and simplify patient documentation. The increased utilization of the software aids in preventing errors that often occur during treatment and diagnosis by ensuring that all the professionals involved with providing care to the patient comprehend the information and are shared the same data, eliminating the risk of mistakes. It in turn reduces the financial burden of various healthcare establishments as medical errors end up causing roughly USD 20 billion to the medical industry each year.

North America Holds Significant Global Medical Terminology Software Market Share

The rapid expansion of the market in the region can be attributed to the rise in spendings in the healthcare sector, increasing requirement for diagnostic device connectivity, growing prevalence of chronic health conditions, and increasing acceptance of technologically advanced devices and solutions. According to the estimates of National Association of Chronic Disease Directors, in 2022 approximately 60% of the adult Americans had at least one chronic disease. The increase is bolstering the requirement for medical terminology software in the region to ensure optimal patient care.

The introduction of favorable assistance programs and government initiatives further supports the expansion of the market in the region. For instance, the Medicare Promoting Interoperability Program encourages eligible hospitals, professionals, and critical access hospitals to implement, demonstrate, upgrade, and adopt meaningful use of certified electronic health record technology.

Reimbursement Expected to Witness Significant Growth Over the Forecast Period

The growth of the reimbursement segment can be attributed to the rise in costs of prescription drugs and growing patient volume. The segment's growth is further driven by a rise in the number of hospitalizations and subsequent submission of claims. According to the estimates of the Center for Disease Control and Prevention, approximately 7.9% of individuals stayed overnight in hospitals in 2022. Smooth medical billing and correct coding are essential for ensuring that the healthcare professionals receive adequate compensation for the provided services.

Furthermore, the growing requirements for enabling enhanced reimbursement outcomes and curtailing healthcare costs are other major factors bolstering the global medical terminology software market demand. Medical terminology solutions are deployed to avoid incorrect data interpretations that often occur due to collecting data related to patient health from diverse sources.

Healthcare Providers Hold a Significant Share of the Market

The rising requirement for medical terminology software by healthcare providers can be attributed to the growing implementation of clinical decision support systems and EHRs in hospitals coupled with growing demand for clinical interface terminologies in the healthcare system. The increase in emphasis on patient safety is further bolstering the demand for medical terminology software among healthcare providers. The utilization of medical terminology software aids in improving patient care as standard terminology ensures the provision of a foundation for interoperability by effectively improving exchange of information. Some of the most common terminology standards utilized in health information and technology include Logical Observation Identifiers Names and Codes (LOINC®), Systematized Nomenclature of Medicine--Clinical Terms (SNOMED CT), RadLex, RxNorm, and MEDCIN, among others. Medical terminology software is preferred by healthcare providers as they aid them in improving their operational efficiency and streamline operations.

Future Market Scenario (2024 – 2031F)

According to global medical terminology software market analysis, the expansion of the market over the forecast period will be supported by the increasing efforts towards developing innovative healthcare software and the growing requirements for personalized medical care. The increasing integration of natural language processing capabilities and artificial intelligence will support the enhancement of data normalization and terminology mapping. Such innovations will enhance the capabilities of medical terminology software, boosting the market's growth in the coming years.

Key Players Landscape and Outlook

The major players in the market are 3M Co, Wolters Kluwer N.V, Apelon, Inc., HiveWorx, and Carecom Co., Ltd. The growing development of generative AI tools for clinical documentation and translating medical jargon for patients will positively influence the market's growth. For instance, in July 2023, Amazon Web Services announced the launch of HealthScribe, an AI powered generative clinical documentation tool. The development deepened their commitment towards supporting innovations in the healthcare industry. The introduction of HealthScribe is expected to alleviate the burden of clinical documentation. A single API is used for recognizing key medical terminologies and developing a transcript of the patient-physician encounter, resulting in the generation of a cohesive summary that will be added to the medical record of the patient.