Digital Health Market Size & Forecast

The Digital Health Market is expected to reach $1,338.52 billion by 2031, at a CAGR of 20.4% from 2024 to 2031. The growth of this market is primarily driven by the increasing access to smartphones and the internet in developing economies, the rising adoption of fitness apps, the increasing use of mHealth and digital therapeutics, the growing adoption of wearable medical devices, and the increasing focus on preventive healthcare. Moreover, the focus on developing advanced medical technologies, the shift toward intelligent health ecosystems, and the growing adoption of remote patient monitoring and home healthcare are expected to generate growth opportunities for the players operating in the digital health market.

Digital Health Market Growth Drivers

Increasing Focus on Preventive Healthcare

Preventive care helps avoid illness and aids early disease diagnosis while promoting good health. Receiving preventive care lowers the probability of disabilities, diseases, and premature death. However, many patients worldwide do not have access to preventive care due to factors such as the absence of primary care providers, high costs, geographical barriers, and lack of awareness. Digital therapeutics help patients prevent disease onset via clinically verified preventive care activities.

Major market players and governments worldwide are increasingly prioritizing investments, policies, and initiatives promoting preventive healthcare. For instance, in March 2021, the European Commission launched the EU4Health program for the period of 2021–2027, with an investment of $6.03 billion (€5.1 billion) in the healthcare sector for disease prevention, health promotion, digital transformation of the healthcare system, integration of digital services & tools, and other areas of intervention.

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Growing Adoption of Wearable Medical Devices

The adoption of wearable medical devices such as smartwatches, fitness trackers, biosensors, wearable ECG monitors, and glucometers is increasing. These devices offer self-monitoring as well as monitoring by healthcare professionals. High awareness in developed countries and rising awareness in developing countries regarding preventive care and personal health are driving the adoption of wearable devices. Additionally, the integration of advanced technologies such as artificial intelligence into wearable medical devices has improved accuracy, data interpretation, and data analysis, which are important aspects of patient care. Therefore, the growing adoption of wearable medical devices is driving the digital health market.

Digital Health Market Trends

Integration of Artificial Intelligence (AI) and Machine Learning (ML)

Wearable medical devices, mobile apps, and remote patient monitoring systems are becoming increasingly efficient. The integration of Artificial Intelligence (AI) and Machine Learning (ML) is driving innovations across the healthcare industry. AI and ML help in monitoring and tracking real-time patient data, detecting diseases, and providing personalized recommendations for preventive care.

Additionally, in digital health, AI collects and analyzes large amounts of data from Electronic Health Records (EHRs), wearables, imaging, and genomics. Healthcare providers gain valuable insights from these datasets, leading to more accurate diagnoses, personalized treatment plans, and improved patient care.

Use of Internet of Things (IoT) Technology in Medical Devices

The use of IoT technology enables medical devices to connect to the internet and transfer data within the connected ecosystem. The integration of IoT into wearable medical devices, glucose monitors, implantable devices, and portable medical devices enables clinicians to extend their reach outside clinical settings. The growing trend of IoT-enabled medical devices is driving the development and adoption of digital health technologies.

Some of the benefits of IoT-enabled medical devices are:

Remote Patient Monitoring: Patients can wear devices that monitor vital signs and send data to healthcare providers in real time, allowing doctors to monitor patients remotely, which can improve the efficiency of care and treatment.

Lower Costs: Doctors do not need to meet patients in person, which can reduce healthcare costs.

Digital Health Market Opportunities

Growing Adoption of Remote Patient Monitoring and Home Healthcare

Remote Patient Monitoring (RPM) heavily relies on digital technologies to monitor and capture health data from patients and transmit it to healthcare providers. This data helps healthcare providers assess and recommend treatment and care plans to patients. The data can also be used for preventive care. Remote patient monitoring gained a lot of traction during the COVID-19 pandemic due to contact and travel restrictions to reduce the risk of infection. This was noticed by the U.S. government, and Medicare coverage was expanded to cover RPM services for those with chronic conditions, further increasing the adoption of remote patient monitoring. Thus, the growing adoption of RPM is expected to generate market growth opportunities in the coming years.

Digital Health Market Analysis: Key Findings

By Component: The Services Segment to Dominate the Digital Health Market in 2024

Based on component, the digital health market is segmented into hardware, software, and services. In 2024, the services segment is expected to account for the largest share of 63.5% of the digital health market. The segment’s large market share is attributed to the adoption of telehealth services, the growing demand for remote patient monitoring, the growth in telemedicine, and the rising prevalence of chronic diseases.

The outbreak of the COVID-19 pandemic accelerated the adoption of telehealth services, encouraging healthcare providers to scale their offerings. Several virtual care services, such as on-demand virtual urgent care, virtual office visits, near-virtual office visits, virtual home health services, and tech-enabled home medication administration, are in high demand.

However, the hardware segment is projected to record the highest growth rate of 23.4% during the forecast period 2024–2031. This growth of this segment is driven by the growing adoption of wearable medical devices, the increasing availability of IoT-enabled medical devices, technological advancements in medical devices, including AI and ML integration, and the increasing adoption of home healthcare.

By Technology: The Telehealth Segment to Dominate the Digital Health Market in 2024

Based on Technology, the digital health market is segmented into telehealth, mHealth, digital therapeutics, and digital health systems. In 2024, the telehealth segment is expected to account for the largest share of 57.6% of the digital health market. The segment’s large market share is attributed to the rising prevalence of chronic diseases, the shortage of healthcare professionals, growing digitalization, and rising awareness regarding the benefits of telehealth.

The demand for more convenient care, along with the unavailability of sufficient medical professionals (particularly primary care providers), has fueled the growth of telemedicine companies. Many companies provide patients with access to medical treatment 24 hours a day, seven days a week, via on-call doctors, while some companies also provide extra clinical staff and specialists to hospitals and major health institutions for outsourcing specific cases (common model among teleradiology companies). Some companies offer telemedicine platforms that allow doctors to conduct virtual consultations with their patients.

However, the digital therapeutics segment is expected to grow at the highest CAGR of 31.5% during the forecast period. The growth of this segment is driven by the growing prevalence of chronic diseases, the increasing internet and smartphone penetration in developing countries, the rising demand for home healthcare, and increasing investments in digital therapeutics. For instance, in June 2023, Wellthy Therapeutics Pvt Ltd (India), a digital care provider, received funding from Beyond Next Ventures Inc. (Japan). This funding is aimed at expanding Wellthy’s platform in the Japanese market.

By Application: The Telehealth Applications Segment to Dominate the Digital Health Market in 2024

Based on application, the digital health market is segmented into telehealth applications, mHealth applications, digital therapeutics applications, and digital health system applications. In 2024, the telehealth applications segment is expected to account for the largest share of the digital health market. The segment’s large market share is attributed to the high adoption of telehealth for psychiatry, the increased adoption of telehealth since the COVID-19 pandemic, and the significant burden of chronic diseases globally.

Telehealth in psychiatry involves the utilization of videoconferencing to allow patients in remote locations to access psychiatric services. It enables patients and providers to access a wide range of services, including psychiatrist consultations, clinical & educational programs, diagnosis and assessment, medication therapy management, and routine follow-up appointments. Patients who require convenient, affordable, and easily accessible mental health care can benefit from video-based telepsychiatry. The global shortage of mental health professionals also contributes to the segment’s large share.

However, the digital therapeutics applications segment is expected to grow at the highest CAGR during the forecast period 2024 to 2031. This growth of the segment is driven by the rising prevalence of chronic diseases, increasing focus on preventive healthcare, and rising concerns over healthcare expenditure. Digital therapeutics help patients prevent disease onset via clinically verified preventive care. Major market players and governments worldwide are increasingly prioritizing investments, policies, and initiatives that promote preventive healthcare. For instance, in March 2021, the European Commission launched the EU4Health program for the period of 2021–2027, with an investment of $6.03 billion (€5.1 billion) in the healthcare sector for disease prevention, health promotion, digital transformation of the healthcare system, integration of digital services & tools, and other areas of intervention.

By End User: The Payers Segment to Dominate the Digital Health Market in 2024

Based on end user, the digital health market is segmented into providers, individual consumers, employers, payers, and other end users. In 2024, the payers segment is expected to account for the largest share of the digital health market. The segment’s large market share can be attributed to the extensive healthcare coverage in developed countries, rising healthcare costs, and the adoption of digital technologies by healthcare payers.

However, the individual consumers segment is expected to grow at the highest CAGR during the forecast period. The growth of this segment is driven by the rising awareness regarding personal health, the growing adoption of preventive healthcare, increasing access to the internet and smartphones, the growing digitalization of healthcare, and the increasing availability and accessibility of digital health technologies for consumers.

Geographic Analysis

By Geography: North America to Dominate the Digital Health Market in 2024

In 2024, North America is expected to account for the largest share of 43.6% of the digital health market. Between the U.S. and Canada, in 2024, the U.S. is expected to account for the larger share of the digital health market in North America. The country’s large market share is attributed to the high burden of chronic diseases, high awareness regarding digital health technologies, the high adoption of home healthcare compared to other developed countries, high healthcare expenditure, insurance coverage for remote patient monitoring in Medicare, and the high adoption of digital therapeutics and telemedicine.

However, Asia-Pacific is slated to register the highest CAGR of 23.2% during the forecast period. The growth of this regional market is driven by favorable government initiatives for digitalization, growing healthcare expenditure, growing internet and smartphone penetration in rural areas, the shortage of healthcare professionals, and growing awareness regarding digital health technologies.

Digital Health Market: Key Companies

The report offers a competitive analysis based on an extensive assessment of the leading players’ product portfolios, geographic presence, and key growth strategies adopted in the last 3–4 years. The key players operating in the digital health market are ResMed Inc. (U.S.), Teladoc Health, Inc. (U.S.), Noom, Inc. (U.S.), Aerotel Medical Systems (1998) Ltd. (Israel), Cerner Corporation (U.S.) (a subsidiary of Oracle Corporation), Medtronic plc (U.K.), Koninklijke Philips N.V. (Netherlands), Siemens Healthineers AG (Germany), Cisco Systems, Inc. (U.S.), Johnson and Johnson (U.S.), Allscripts Healthcare, LLC (U.S.), Omron Healthcare Inc. (Japan), GE Healthcare (U.S.), Abbott Laboratories (U.S.), International Business Machines Corporation (U.S.), and Samsung Electronics Co. Ltd. (South Korea).

Digital Health Industry Overview: Latest Developments from Key Industry Players

• In October 2023, PT BitHealth Teknologi Pintar (Indonesia), a digital health solutions provider, partnered with InterSystems Corporation (U.S.) to create digital data management and integration solutions for the healthcare sector in Indonesia.
• In April 2023, Ubie Inc. (U.S.) entered into an agreement with Takeda Pharmaceutical Co., Ltd. (Japan). Under this agreement, Takeda will promote the detection of diseases and provide guidance for appropriate medical examinations using Ubie’s Symptom Checker.
• In May 2021, Teladoc Health launched myStrength Complete, an integrated mental health service providing personalized, targeted care to consumers in a single, comprehensive experience.

Digital Health Market Research Summary:

Key questions answered in the digital health market report: