Image courtesy of IBISWorld
June 7, 2016 — According to market research firm IBISWorld, the average price of electronic medical record (EMR) software is forecast to continue declining at an average annual rate of 0.7 percent through 2019. While the adoption of EMR software is expected to accelerate during the period, mounting market competition and falling operating costs will prompt suppliers to reduce their prices to win and retain business.
"Demand will surge as healthcare providers continue to implement and recognize the benefits of using EMR software to improve organizational efficiency and quality care, as well as to minimize media errors and administrative expenses," said IBISWorld procurement research analyst Anna Son.
While there are an estimated 1,170 firms offering EMR software, the top four companies, including Epic Systems and Cerner Corp., account for about 40 percent of total market revenue. In light of strengthening demand for EMR software adoption across the country, more companies are entering the market to take advantage of its growth opportunities. However, during the next three years, the market is expected to undergo some consolidation as larger suppliers seek to acquire their small competitors to expand their product offerings and geographic footprint.
Despite continued market growth, rising market share concentration can hamper buyer power because large players gain greater control over market prices and the upper hand in price negotiations, thus limiting buyer options.
In addition, due to concerns surrounding EMR software's efficacy and security, software suppliers will bolster their research and development (R&D) efforts to improve product quality and differentiate from competitors. However, sales growth is expected to accelerate at a faster rate than R&D and labor costs, allowing suppliers to contain their operating costs. As a result, suppliers will be able to pass these cost savings down to buyers in the form of lower product prices.
For more information: www.ibisworld.com