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March 2025
Principal Consultant
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The U.S. healthcare ERP market size is calculated at USD 2.17 billion in 2024, grew to USD 2.3 billion in 2025, and is projected to reach around USD 3.83 billion by 2034. The market is expanding at a CAGR of 5.84% between 2025 and 2034. Technological advancements and the growing demand for advanced patient care drive the market.
The global healthcare ERP market is valued at $7.99 billion in 2024 and is expected to grow to $8.57 billion in 2025. Looking ahead, it’s projected to reach approximately $16.06 billion by 2034, expanding at an annual growth rate of 7.23% from 2025 to 2034. This growth is fueled by the increasing demand for advanced medical treatments, continuous technological innovations, and the rapid expansion of the healthcare industry.
Enterprise resource planning (ERP) is a software system comprising distinct yet interconnected modules that support various business functions. Healthcare ERP modules serve as the nerve center of a healthcare organization, integrating core processes such as finance, human resources, supply chain management, and inventory management. It helps perform a wide range of functions, from patient records and medical inventory to billing, staff scheduling, and compliance. This enables business professionals to improve operational efficiency and data accuracy, simplifying workflows.
The advent of advanced technologies such as AI, ML, and IoT revolutionizes the operation of a healthcare organization, boosting the market. Several government bodies support the adoption of digitization in a healthcare setting, facilitating the use of healthcare ERP systems. The increasing investments, collaborations, and mergers & acquisitions promote the development and use of healthcare ERP systems. The rising number of hospitalizations necessitates the adoption of ERP systems. ERP systems also enable healthcare organizations to focus more on patient care.
Artificial intelligence (AI) and machine learning (ML) algorithms can automate routine tasks, improving operational efficiency and streamlining business processes. They significantly enhance the capabilities of ERP systems by analyzing vast amounts of data in real time and enabling healthcare professionals to make informed, effective clinical decisions. AI-driven ERP systems can learn from data over time, adapt to new patterns, and provide actionable insights that drive business success. AI can automatically adjust inventory levels and reduce wastage. It enables healthcare professionals to provide personalized treatment, thereby enhancing patient experiences. Additionally, AI can optimize resource utilization, resulting in cost savings. Natural language processing (NLP) systems make ERP more user-friendly and accessible to all employees.
Advanced Patient Care
The major growth factor of the U.S. healthcare ERP market is the growing demand for advanced patient care. The increasing geriatric population and the rising prevalence of chronic disorders lead to an increased number of hospitalizations. According to the 2023 Annual Survey of the American Hospital Association (AHA), approximately 34.4 million hospital admissions were reported. This enhances the demand for individualized care and state-of-the-art treatment for patients. Healthcare ERP systems alleviate the frenzied environment in a healthcare setting. They enable healthcare professionals to perform administrative tasks and manage finances, allowing them to focus more on patient care. They provide quick access to patient records, enabling more informed and timely decisions. Thus, they help deliver faster service, building trust and patient satisfaction.
High Cost
The major challenge of the market is the high cost of implementing ERP systems in a healthcare organization. The average cost of installing an ERP system in a mid-sized business is estimated to be between $150,000 and $750,000. The high cost limits the affordability of numerous healthcare organizations, especially small- and medium-sized, restricting market growth.
EHR Integration
The future of the U.S. healthcare ERP market is promising, driven by technological advancements such as the integration of EHRs and telemedicine. An electronic health record (EHR) is a systematized collection of electronically stored patient health information in a digital format. Telemedicine, also known as telehealth, refers to the remote monitoring and treatment of patients. It is estimated that around 96% of the U.S. non-federal hospitals. Advanced technologies have enabled the integration of Electronic Health Records (EHR) and telemedicine into Enterprise Resource Planning (ERP) systems, creating greater value. Integrating ERP systems with telemedicine can keep records of expired medicines and notify patients. On the other hand, ERP with EHR centralize patient information for easy access and improved coordination among medical teams. Thus, incorporating ERP systems with EHR and telemedicine provides a synergistic effect, benefiting both systems and expanding access to healthcare services.
By function, the finance & billing segment held a dominant presence in the U.S. healthcare ERP market in 2024. Healthcare ERP systems play a crucial role in managing the complex financial operations of a healthcare organization. Apart from hospitals, they are also implemented in health insurance companies. They simplify the process of patient billing and claims processing. ERP systems also maintain patient health records and medical histories, enabling healthcare professionals to make informed, proactive decisions. These aspects enable healthcare organizations to accelerate their revenue while focusing on patient care.
By function, the inventory & material management segment is projected to expand rapidly in the market in the coming years. A hospital inventory comprises a stock of medical resources, including equipment, medicines, and patient health data. ERP systems help manage inventory by monitoring medical products, ordering drugs, and selling items. This enables healthcare organizations to avoid financial losses and product shortages, reducing wastage. The increasing number of clinical trials in hospitals also facilitates the implementation of ERP systems for the timely delivery of essential products. As of March 2025, 33,448 active recruiting and non-recruiting clinical trials are registered on the clinicaltrials.gov website.
By deployment, the on-premises segment held the largest share of the U.S. healthcare ERP market in 2024. On-premises healthcare ERP systems are managed and installed on an organization’s servers and hardware. Hence, they give complete control over the system, enabling healthcare organizations to provide customized solutions. They also maintain privacy and data security of essential patient data. They can facilitate the sharing of data across various departments, enhancing collaboration and communication within the organization. Additionally, on-premise ERP systems are comparatively cost-effective as they avoid the need for annual subscriptions.
By deployment, the cloud segment is anticipated to grow with the highest CAGR in the market during the studied years. Cloud ERP is a software system that runs on a vendor’s cloud platform over the internet. The rising adoption of 5G technology boosts the segment’s growth. Cloud ERP eliminates the need for specialized infrastructure within a healthcare organization, allowing it to be operated from anywhere and at any time. It offers lower upfront costs, faster implementation, and reduced staff resource usage. It delivers real-time data faster than on-premise ERP. It also allows easier scalability as it is less expensive to implement across various locations.
By end-use, the hospital segment led the U.S. healthcare ERP market in 2024. The increasing number of hospitals and the rising number of hospital admissions augment the segment’s growth. There are around 6,093 hospitals in the U.S., out of which 5,112 are community hospitals. People usually prefer hospitals for managing their chronic conditions due to the presence of skilled professionals and specialized equipment. The availability of favorable infrastructure enables hospitals to install ERP systems. Favorable reimbursement policies also foster the segment’s growth.
By end-use, the clinics segment is anticipated to show lucrative growth in the market during the forecast period. The segmental growth is attributed to the increasing number of specialized clinics and the presence of skilled professionals. Skilled professionals can operate complex ERP hardware and software solutions. There are more than 31,748 clinics in the U.S., including medical clinics, mental health clinics, women’s health clinics, etc. In clinics, healthcare ERP systems facilitate the management of patient records, billing, and inventory. Clinics have suitable capital investment to adopt ERP systems.
Advanced healthcare infrastructure and increasing healthcare spending are promoting the adoption of healthcare ERP systems, thereby fueling the growth of the U.S. healthcare ERP market. According to the Centers for Medicare and Medicaid Services, national healthcare spending was $4.9 trillion in 2023, accounting for 17.6% of the total GDP. Favorable government policies and the increasing adoption of advanced technologies are expected to augment the market. Several government agencies, including the Food and Drug Administration (FDA) and the Department of Health and Human Services (HHS), actively support digitization in healthcare to enhance accessibility and improve cost-effectiveness. HHS spends approximately $5 billion annually on IT. The growing demand for precision healthcare also contributes to the market.
John Kravitz, Head of Healthcare, Workday, announced that KLAS Research recognized the company as the top-performing cloud ERP solution for healthcare. He commented that as healthcare organizations navigate economic uncertainty and adapt to changing business demands, they require the right tools to accelerate their digital transformation efforts. The company enables healthcare organizations to improve operational efficiencies using its AI and ML systems.
By Function
By Deployment
By End-Use
March 2025
March 2025
March 2025
March 2025
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