Introduction

The US healthcare industry has adapted to software as a service (SaaS) to increase its versatility and accessibility. Gone are the days of on-site legacy systems as companies have been able to break down silos by implementing technological solutions to take advantage of the latest offerings. SaaS users can now connect directly to their Electronic Medical Records (EMR) through online portals and get billed by subscription fees. 

In 2020, there were over 370 healthcare SaaS companies in the US. Studies show that the SaaS adoption rate in the healthcare industry is growing at 20% per year and will reach $51.9 billion by 2024.

In this article, we will first elaborate on how the healthcare SaaS industry has altered the healthcare landscape in the United States. The second section will take a look at what one of the big tech, Amazon, has been doing in the health sector and how it has impacted the health ecosystem in the US. Finally, we will discuss how the health industry has fared in 2020 and what the future outlook looks like.

  1. Healthcare SAAS Platforms
  2. The Impact of Healthcare SaaS
  3. Big Tech in Focus: Amazon
  4. The Impact of Covid-19
  5. Future Outlook
  6. Conclusion

Healthcare SaaS Platforms

For the last few decades, healthcare organizations have contended with a population that is growing older & sicker, heightened costs, and shifting consumer demands for fast and convenient services. Furthermore, the electronic health record (EHR) boom over the last ten years has ushered in the need for organizations to revamp their operations, IT strategies, and infrastructure.

The proliferation of SaaS platforms has helped alleviate these issues, disrupting the US health industry. They have helped bridge technological gaps that give health organization partners the opportunity to realize cost savings and bolster their top lines. Not only that, these platforms have delivered faster, better, and cheaper healthcare services they have also helped save more lives by enhancing the quality of care and improving overall health.

Two cloud-based solutions, telehealth and telemedicine, have gained immense popularity over the last few years. 

Telehealth refers broadly to electronic and telecommunications technologies and services used to provide care and services at-a-distance while telemedicine is the practice of medicine using technology to deliver care at a distance. 

The difference between the two is that telehealth refers to a broader scope of remote health care services than telemedicine. 

“Telehealth has been quite popular in the United States; according to the Hospital & Health Systems 2016 Consumer Telehealth Benchmark Survey, every 3 out of 4 health facilities implement a telehealth program.”

According to a HIMSS Analytics survey, 31% of healthcare organizations use video-based telemedicine services, and 34% offer remote patient monitoring. To further gauge the demand for telehealth, a study with a sample size of 147 participants found that 44% of healthcare organizations moved towards video-based telemedicine services, and 48% planned for remote patient monitoring.

A Frost & Sullivan report predicts that the telehealth market will reach an estimated $234 billion by 2023, up from $147 billion in 2019. Thus, it will hold the highest market share. 

Meanwhile, the telemedicine market is also undergoing exponential growth in the US and is expected to have a net worth of $64 billion by 2025.

The Impact of Healthcare SaaS

Healthcare SaaS companies aim to solve many health ecosystem players’ issues and needs. With the rise of telehealth and telemedicine startups, patients can now access quality medical care when needed. 

1.   Easier collaboration between medical professionals 

The medical staff can access lab results, tests, etc. from one place. Online sharing has allowed medical professionals from all over the world to collaborate and communicate.

2.   Transparency

Health records are maintained online, improving transparency.

3.   Online Training

Medical professionals can study, take tests, and enhance their knowledge at their own pace.

4.   Better Data Security

Through reliable SaaS platforms, medical institutes can access the latest technological solutions to improve data security at reasonable costs.

5. Scalability

Health SaaS platforms can expand with the increasing user base, hence reaching a wider audience.

Top Healthcare SaaS Companies

List of Top Healthcare SaaS Companies in the US

Big Tech in Focus: Amazon

The world’s leading tech companies have long viewed healthcare as an unexploited opportunity. These players have been ramping up their efforts to reshape healthcare by developing and collaborating on new tools that could be a boon to consumers, medical professionals, and insurers.

Taking a leaf out of the same strategy, Amazon has made several partnerships and investments in the healthcare space, including collaborations with Cerner and the Pittsburgh Health Data Alliance. The motive behind these partnerships was that Health care represents a $3.5 trillion sector for Amazon. Therefore, the company launched Amazon Care, a healthcare program for its employees, and acquired Health Navigator.

Amazon’s Healthcare Strategy

Amazon’s motto for healthcare is to establish an independent healthcare company “free from profit-making incentives and constraints.” To do this, Amazon has deployed many methods:

1.   Reinvesting revenue into massive infrastructure build-outs in the logistics and data center spaces to make the entry into the healthcare sector smooth, as seen in AWS’s case.

2.   Their fulfillment centers, supply chain, and acquisition of Whole Foods have quickly put them within range to distribute healthcare goods and services.

3.   Using consumer data to construct services by the demand

What Amazon does is that it first creates a user-friendly product that is no match for its competitors. This allows the company to build economies of scale, network effects, and bargaining power. Then they invest in upfront fixed costs that enable the company to function better and provide an outsourced version of services to its customers. After developing a broad customer base, Amazon standardizes the suppliers’ offerings, creating a transparent and competitive market for buyers and suppliers.

Amazon Web Services (AWS)

AWS is collaborating with multiple healthcare providers, public health organizations, government agencies, and life science businesses worldwide to improve telemedicine.

This development of telemedicine via Amazon started when Cerner made AWS their preferred cloud provider. The partnership aims to enhance the clinician’s use of the HER, lower the operational burden on the health systems, and improve patient outcomes. Similarly, AWS collaborated with the Pittsburgh Health Data Alliance to improve cancer diagnosis, precision medicine, voice-enabled technologies, and medical imaging. They also hope to enhance treatments using machine learning. Both these partnerships resulted in an increase in AWS revenue by 35 percent, reaching $9 billion. Another collaboration done by AWS is with Virtusa, a digital health company. This partnership aims to conduct medical research using artificial intelligence. AWS also partnered with the NFL to use artificial intelligence and machine learning to observe the impact of player injuries, equipment, game rules, and rehabilitation strategies on the player’s health.

Other than multiple partnerships, AWS also launched Amazon Transcribe Medical, a voice transcription service for physicians that inputs text directly into medical records. This will allow developers to understand patient information and medical text. The service can be integrated into a cloud device or apps.

Details about Amazon Care and Health Navigator

The Healthcare Ecosystem since Amazon

Amazon has transformed the field of telemedicine. The introduction of Amazon Care can serve as a new model for corporate healthcare. According to a survey by Henry J. Kaiser Family Foundation, in 2020, annual family premiums for employer health insurance rose 5% to an average of $20,576. Workers pay $6,015 approximately towards the premium cost, leaving the rest up to their employers. With services such as Amazon Care, corporations can save up on insurance costs while controlling for quality. It will also make access to primary health care easier, medicines more affordable, and the overall insurance process more straightforward and transparent. Such services positively impact employees, as found in a survey conducted by Deloitte– this system proved to be more convenient for 64% of the employees, and 52% agreed that it boosted patient satisfaction.

Moreover, Amazon’s new healthcare company can also give smaller healthcare companies a much-needed boost. For tech giants such as Amazon to develop an efficient health system, they need to collaborate with those in the field already. Amazon can provide such measures through machine learning, AI, online communications, etc. To supplement their program, they need outside help from health experts, where these smaller healthcare companies come into action.

With Amazon’s entry into healthcare SaaS, other tech giants such as Apple have also entered the market. Apple has introduced a health service- AC wellness, an on-premise, and remotely accessible healthcare service as part of their employee compensation and benefits package. However, Apple does not seem to be a strong competitor. Amazon has made the most in-depth move into the telemedicine sector, representing a $130 billion market opportunity if it opens its clinic to the general public.

The Impact of Covid-19 on Healthcare SaaS

Covid-19 has accelerated the growth of healthcare SaaS startups in the US. With the lockdown and hospitals being the center of the virus, the demand for medical distancing, and consequently, virtual clinics increased. To cater to telemedicine services, the American government provided $200million to the companies to provide affordable healthcare services. The effectiveness of telemedicine has been promising in diabetic care, dermatology, and cardiology, allowing for high-quality remote care while saving time and valuable physical space.

It is believed that telemedicine can help in flattening the curve since symptoms and disease recovery can be monitored through voice/video calls, keeping low-risk and mild-symptom patients, who are also more likely to spread the virus, at home.

Big players have also started investing in the virtual healthcare sector. For example, Merck Global Innovation Fund has made more than 40 digital health investments and $500 million in evergreen funds related to therapy planning, care management, e-clinical trials, and health analytics. Similarly, BlueCross has pledged $575 million to invest in primary healthcare.

Amazon has also been one of the companies on the frontline to assist in the pandemic. AWS launched the HPC on AWS for COVID-19 Research and AWS Diagnostic Development Initiative (DDI) to support diagnosis, treatment, and vaccine studies. Moreover, the COVID-19 Dataset from Johns Hopkins is also available on AWS Data Exchange.

The telemedicine system during Covid-19 has also highlighted some of the strengths and weaknesses of the course:

StrengthsWeaknesses
·   Helps in flattening the curve·   Costs and reimbursements aren’t specified
·   Allows for crowd-sourcing·   Insurance might not cover telemedicine
·   Can make predictions about future waves·   Not accessible to those who aren’t tech-savvy
·   User-friendly·   Privacy concerns

Future Outlook

Due to its versatility and accessibility, healthcare SAAS is becoming immensely popular. It is predicted that by 2022, the SAAS industry will be worth $143.7 billion, as shaped by the trends and growth in 2020. Some of the trends for this year are:

Trends in Healthcare: Artificial Intelligence
Trends in Healthcare: Vertical SaaS
Trends in Healthcare: Micro SaaS

Conclusion

Healthcare SAAS is one of the rapidly increasing industries in the USA and has successfully established a large customer base. It infiltrates almost all areas of medicine, ranging from cardiology to mental health to online pharmacies. Its rise may also respond to the on-going COVID-19 pandemic, which increased the importance of virtual healthcare. The growth in the industry has been facilitated by the US government as well.