Commentary: Health IT market to consolidate into superstores

The U.S. health IT market is in the early phases of a massive consolidation that will ultimately create a handful of “healthcare IT superstores” or "healthcare information networks," according to a recent commentary from Marlin & Associates, a strategic and financial advisory firm for the technology and healthcare industries.

The commentary noted that a confluence of technologies will enable radical changes at relatively reasonable costs. In addition to advances in the field of medicine, there have been breakthroughs in telecommunication, data management, infrastructure and analytics technologies, laying the foundation for more innovative technologies for the industry.

In the not-too-distant future, a few companies will emerge to lead the healthcare information industry, according to the commentary. These companies will integrate the key components of a healthcare information network—and thereby will be in a position to set industry standards.

The market commentary makes five predictions for the future of health IT:

• A quickening pace of merger and acquisition activity among administrative (payor and provider sides), revenue cycle management and analytics businesses.
• Payors will take a more active part in individualizing medicine to avoid becoming commoditized.
• An increasing trend toward outsourcing, which will lead to the creation of a new breed of companies that will focus on managing the information flow in many health information exchanges.
• Incumbents in the health IT industry such as Ingenix; telecoms such as AT&T or Verizon; or large technology companies like IBM and Microsoft will all strive to provide the health information networks.
• The private sector will set the standards for the industry; just as Microsoft and Intel set technology standards in the 1980s.