North American PHM Market Worth $1.01B in Q4 2016

Written by Alex Green

Published: March 30, 2017

  • Signify Research preliminary analysis and commentary on the North American Population Health Management IT Market (PHM Market), which includes data for the quarter ending December 2016
  • Q4 2016 population health management (PHM) market in North America remained buoyant despite uncertainty around US healthcare reform
  • Revenues of $1.01 billion were generated in Q4 2016, up 17% YoY and up 8% compared to previous quarter
  • PHM solution spending for FY2016 in North America was $3.7 billion, up 15% on 2015

Analysis

Signify Research’s preliminary market estimates for the Q4 2016 North American population health management (PHM) IT market (platforms and services) shows that despite the uncertainty caused by the US presidential election, and its potential ramifications for US healthcare policy, the market remained buoyant. PHM revenues for Q4 2016 in North America stood at an estimated $1.01 billion, up 17% on the same period in 2015 and up 8% on the previous quarter in 2016.

The continued growth in the fourth quarter does need to be put in context. The fall out of the presidential election result is unlikely to have had time to substantially affect sentiment to the point that immediate orders would have been impacted.  Fourth quarter has also traditionally been a seasonally strong quarter for leading vendors of PHM and related solutions.

The results are still very encouraging though. It is Signify Research’s view that the longer-term trend towards value-based care, the move to accountable care organisations (ACO) and the need to better manage health care spending in general will ultimately drive continued growth for vendors offering PHM solutions, despite legislative uncertainty.

AG Chart 30-3-17

Supplier Base Remains Fragmented

For the full year 2016, the North American PHM market was estimated to have been worth $3.7 billion, compared to $3.2 billion in 2015. The list of companies that drive these numbers remains long, and is indicative of the fact that the market, despite reaching a certain level of maturity, is still highly fragmented. However, several companies including Optum, IBM Watson Health, Cerner, Allscripts, Conifer Health and Evolent have started to take market leading positions in terms of share. Between them they are estimated to have accounted for approximately 45% of the 2016 market. Most still only command a single digit share in 2016, with a long list of vendors closely following.

Data Aggregation / Analytics / Stratification Driving Market to Date

Signify Research’s upcoming report segments the market in to three main components, data aggregation/analytics/risk stratification solutions, care coordination/management solutions and patient engagement solutions. Of the three, the data aggregation/analytics/risk stratification segment represented the largest market in 2016 and is projected to remain the largest for the report’s forecast period (2017-2021). Similarly, the provider vertical, specifically the acute provider sector, is also projected to remain the largest market channel compared with the payer, employer and other verticals.

Full Impact of Legislative Uncertainty Yet to be Felt

As indicated above, the real test of the impact of uncertainty in relation to potential changes in legislation will be in seen in market performance during the first half of 2017. Results for Q1 2017 will be eagerly awaited. Signify Research’s market update in the second half of 2017 will give an early indication on the level to which this uncertainty hits the revenues for PHM solution vendors in 2017. However, it’s our view that strong annual growth will continue in 2017, with the market projected to grow a further 16%.

New Market Report from Signify Research Publishing Soon

The market data presented above are the preliminary estimates and forecasts from Signify Research’s upcoming report on the North American PHM market which will be published in April. The report is a component of the Signify Research “PHM & Telehealth Market Intelligence Service”. Vendors tracked include Aetna, Allscripts, AthenaHealth, AxisPoint Health, Caradigm, Cerner, Conifer Health, eClinicalWorks, Enli, Epic, Evolent, HealthCatalyst, Humana/Transcend Insights, IBM Watson Health, McKesson, Medecision, Meditech, NextGen, Optum, Orion Health, Premier Inc., Verscend, ZeOmega and others. The report provides quarterly market estimates for 2015 & 2016, and annual forecasts by vertical, function, service type, platform delivery and country to 2021.

For further details please click here or contact Alex.Green@signifyresearch.net.