Forecast: Enterprise IT Spending for the Healthcare

and Life Sciences Markets, Worldwide, 2022-2028,

2Q24 Update
13 August 2024 - ID G00808905 - 8 min read
By Analyst(s): Jonathan Rivera, Inna Agamirzian, Rika Narisawa, James Ingham
Initiatives:Industry Markets for Tech Providers

Gartner forecasts that healthcare and life sciences enterprise IT

spending will grow by 9.4% in 2024, reaching $301.9 billion in
constant currency. HCLS leaders are increasing expenditure on
software and services, with annual expected growth rates of
13.0% and 8.8%, respectively.

Table of Contents
1 Summary Tables Suitable for Printing

2 Pivot Table for Analysis

3 Data Segmentation and Structure

4 Exchange Rates

5 Tips

List of Tables
1-1 Total IT Spending for Healthcare and Life Sciences by Industry and Subindustry,
Worldwide, 2022-2028 (Millions of Constant U.S. Dollars)

1-2 Total IT Spending for Healthcare and Life Sciences by Segment, Worldwide, 2022-
2028 (Millions of Constant U.S. Dollars)

1-3 Total Services Spending for Healthcare and Life Sciences, Worldwide, 2022-2028
(Millions of Constant U.S. Dollars)

Gartner, Inc. | G00808905 Page 1 of 10

This research note is restricted to the personal use of [email protected].

 1-4 Total IT Spending for Healthcare and Life Sciences by Region, Worldwide, 2022-2028
(Millions of Constant U.S. Dollars)

2-1 Forecast Pivot Table: Enterprise IT Spending by Vertical Industry Market, Worldwide,
Healthcare and Life Sciences, 2022-2028

4-1 Current U.S. Dollar Exchange Rates Used in Creating This Report

Overview
All figures in this report are in constant currency unless specified otherwise.

This forecast for Gartner’s combined healthcare and life science (HCLS) industry
comprises healthcare providers (hospital and physician and allied health services), health
insurance (payer), and life science segments. The global HCLS enterprise IT spending is
forecast to grow by 9.4% in 2024, reaching $301.9 billion in constant currency. IT
spending is expected to see a five-year compound annual growth rate (CAGR) of 10.2% to
reach an estimated $449.4 billion by 2028. This growth is driven primarily by an increased
spend on software and services, with 2024 growth rates of 13.0% and 8.8%, respectively.
From 2023 to 2028, these segments will grow at a CAGR of 13.7% for software and 10.5%
for services.

HCLS Spending Trends

While HCLS buyers’ IT budgets remain relatively healthy, the global impact of conflicts
and inflation continues to negatively affect enterprise spending, with organizations
modifying their buying behaviors in response. This has resulted in hesitancy, fewer and
larger purchases, extended buying cycles, and delayed buying decisions in response to
short-term increases in average selling prices (ASP) on goods, resulting in pent-up
demand and an increased growth rate for 2024 onward, compared to 2023. Overall,
Gartner expects software and IT services to remain strong as organizations across the
globe continue to adopt digital-first business models and undertake cloud migration
efforts. This trend remains persistent in the HCLS industry.

Healthcare Providers

Gartner, Inc. | G00808905 Page 2 of 10

This research note is restricted to the personal use of [email protected].

 Despite economic pressures, providers continue to prioritize operational excellence,
technology modernization and customer experience (see Infographic: 2024 Top
Technology Investments and Objectives for Healthcare Providers). Gartner forecasts the
2024 IT spending for the healthcare provider market to increase by 10.3% for the hospital
segment and 7.1% for the physician segment to a combined total of $200.5 billion in
constant U.S. dollars. These investments will emphasize technologies that enable
technology modernization, such as software and IT services, that enhance cybersecurity,
provide business intelligence and data analytics, and drive efficiency gains in clinical and
operational areas. Some of the specific IT areas that healthcare providers are expected to
invest in are the continued expansion of electronic health records (EHRs), revenue cycle
management (RCM) systems, clinical decision support systems (CDSS), AI, and machine
learning (ML), integration technology and cybersecurity solutions.

In 2024, healthcare provider organizations are also expected to continue to invest in cloud-
based infrastructure as a service (IaaS) at an elevated level, increasing by approximately
24.1% for both hospital providers and physicians to a combined total of $16.3 billion in
constant U.S. dollars, as the potential to maximize the number of advantages, such as
scalability, flexibility and cost savings. (Note: in the short term cloud computing may be
more expensive, and organizations may not yet be able to retire the infrastructure in their
own data centers until systems lift and are shifted, data is migrated, and the applications
are stabilized.)

U.S. Healthcare Payers

Revenue growth continues to be a top priority for U.S. healthcare payers, as evidenced by
continued focus on membership growth in insured products, their increased emphasis on
the role of experience in competitive differentiation and expanded digital offerings. U.S.
healthcare payer organizations also demand administrative efficiency and organizational
agility to remain competitive in a rapidly changing healthcare landscape. Gartner
forecasts the IT spending for the U.S. healthcare payer market to increase by 9.0% in 2024
to a total of $50.2 billion in constant U.S. dollars. One notable trend is the blurring of the
line between payer and provider. Payers continue to launch or acquire care delivery
organizations as part of their strategic reorientation to direct more healthcare interactions
(see U.S. Healthcare Payer Insurance Industry Insights Primer for 2024). Meanwhile,
provider organizations are pressuring incumbent payers by launching their own managed
care plans to increase revenue and gain a greater share of the healthcare value chain.

Life Science

Gartner, Inc. | G00808905 Page 3 of 10

This research note is restricted to the personal use of [email protected].

 Digital innovation and transformation in the life science industry remains persistent as
organizations face economic headwinds (see Life Science 2024 CIO Agenda Insights and
Data). Despite these challenges, life science manufacturers are investing significantly in
hyperautomation and AI technologies to supercharge operational excellence (see Life
Sciences Industry Technology Insights Primer for 2024). Gartner forecasts the IT spending
for the life sciences market to increase by 6.5% in 2024 to $25.8 billion in constant U.S.
dollars. Investments in generative AI are also being used to digitalize the business,
develop new product lines, and deliver new health value and monetization streams (see
Predicts 2024: Generative AI Brings New Value to Life Sciences).

Methodology
The healthcare and life sciences industry forecast details total enterprise IT spending,
including breakouts for data center systems, devices, software, IT services and telecom
services for 42 countries within 9 regions. We also include a breakdown for hospital,
physician, healthcare insurance (payer) and life sciences subsectors (see Market
Definitions and Methodology: Vertical Industries). The healthcare provider industry
forecast includes hospitals, hospital systems, ambulatory services and physician
practices. The forecast for healthcare providers does not include government spending on
healthcare, such as Medicare or Medicaid spending, spending on veterans, or spending by
individual government departments. Healthcare insurance includes direct health and
medical insurance carriers. And life sciences encompasses pharmaceutical research,
development and manufacturing and medical devices.

This 2Q24 forecast update includes the alignment of the years 2022 and 2023 to Gartner’s
2023 annual market share research, a rebasing of our vertical-specific software (VSS), and
a revision of forecast assumptions and predicted growth for services, devices and data
center systems. Within the 2Q24 update, segmentation changes are also implemented,
and specifically impacting this forecast are servers, PCs, tablets and mobile phones,
software, IT services, and public cloud services. For the complete list of published market
forecasts and segmentation changes please reference Tool: Forecast and Market Share
Data Publication Schedule for 2024, 2Q24 Update.

Revised IT Services Segmentation

Effective 2Q24, Gartner has significantly changed what it includes in IT services. As a

result, we have determined that the name “IT services” is insufficient to describe this larger
and increasingly diverse market. Starting with the 2Q24 forecast publication, we are using
the name “services” instead of “IT services.” For further details on this update, see Update:
Gartner to Revise Its IT Services Segmentation.

Gartner, Inc. | G00808905 Page 4 of 10

This research note is restricted to the personal use of [email protected].

 Server Market

Server market spending measured in current currency is currently projected to reach $187
billion in 2024. This reflects a 41.5% year-over-year change in constant currency, with a
17.3% five-year compound annual growth rate (CAGR) through 2028. This is a global
increase of $36 billion to the current currency enterprise spending levels in 2024
compared to the 1Q24 iteration of the Servers forecast. This spending increase is a result
of increasing demand for high-cost AI-optimized servers across the market, particularly
among hyperscale buyers.

Vertical-Specific Software

As part of our ongoing efforts to improve the quality and value of the data we provide
clients, Gartner embarked on a project to expand the categories and inclusion for vertical-
specific software (VSS). The result of this effort is a rebasing, starting in 2022, of our
estimates across all vertical industries. VSS is a crucial enterprise application category
which has been evolving and expanding across all industries and that drives significant
value and differentiation. Starting with the 2Q24 forecast, Gartner’s 2022 VSS revenue
estimates for healthcare and life sciences is $33.9 billion which is a $21 billion
adjustment to our previous 2022 estimates.

While the rebase has changed our VSS industry estimates, there were no adjustments to
the global technology market segment estimates, such as services or devices, but overall
software numbers have increased.

Russian Invasion of Ukraine

In response to the Russian invasion of Ukraine that began on 24 February 2022 and was
ongoing at the time of this publication, Gartner is suspending market coverage of Russia
and the Eurasia region. The definition of the Rest of Europe has been expanded to include
Russia and the countries previously covered in the Rest of Eurasia.

Region Changes

Effective 2Q24, Gartner has revised the regional structure and associated “Rest of” roll-up
geographies that are presented within Market Share reports and associated analysis
publications. As part of the changes, we have combined “Western Europe” and “Eastern
Europe” into one “Europe” region, and renamed “Greater China” to “China (Region).” For
more information, see Update: Gartner to Revise Regions in All Forecasts and Market
Shares.

Gartner, Inc. | G00808905 Page 5 of 10

This research note is restricted to the personal use of [email protected].

 Exchange Rate Alert

In the current environment, currency exchange rate fluctuations will be more volatile.
Foundational factors, such as interest rates, tariffs and economic sanctions, can change
with more rapidity and with less predictability than historical norms. For the near term,
expectations for exchange rates should be treated with a heightened caution.

Note: Microsoft Office 365 applications have added a feature that blocks untrusted
macros from running by default; therefore, no macros are used within this workbook.
Please see the workbook for instructions for using the updated functionality.

The data in the downloadable .zip file contains one Excel report along with data formatted
in a comma-delimited flat file (.csv) that can be imported into a variety of other
applications.

Spreadsheets published by Gartner may leverage features such as pivot tables and
macros that are supported in a Microsoft Windows environment and with Microsoft Excel
2007 or higher.

See Gartner Internet Browser System Requirements for more information.

Document Revision History

Forecast: Enterprise IT Spending for the Healthcare and Life Sciences Markets, Worldwide,
2022-2028, 1Q24 Update - 24 April 2024

Forecast: Enterprise IT Spending for the Healthcare and Life Sciences Markets, Worldwide,
2021-2027, 4Q23 Update - 1 February 2024

Forecast: Enterprise IT Spending for the Healthcare and Life Sciences Markets, Worldwide,
2021-2027, 3Q23 Update - 19 October 2023

Forecast: Enterprise IT Spending for the Healthcare and Life Sciences Markets, Worldwide,
2021-2027, 2Q23 Update - 24 July 2023

Forecast: Enterprise IT Spending for the Healthcare and Life Sciences Markets, Worldwide,
2021-2027, 1Q23 Update - 19 April 2023

Forecast: Enterprise IT Spending for the Healthcare and Life Sciences Markets, Worldwide,
2020-2026, 4Q22 Update - 9 January 2023

Forecast: Enterprise IT Spending for the Healthcare and Life Sciences Markets, Worldwide,
2020-2026, 3Q22 Update - 18 October 2022

Gartner, Inc. | G00808905 Page 6 of 10

This research note is restricted to the personal use of [email protected].

 Forecast: Enterprise IT Spending for the Healthcare and Life Sciences Markets, Worldwide,
2020-2026, 2Q22 Update - 29 July 2022

Forecast: Enterprise IT Spending for the Healthcare Provider Market, Worldwide, 2020-
2026, 1Q22 Update - 7 April 2022

Forecast: Enterprise IT Spending for the Healthcare Provider Market, Worldwide, 2019-
2025, 4Q21 Update - 24 January 2022

Forecast: Enterprise IT Spending for the Healthcare Provider Market, Worldwide, 2019-
2025, 3Q21 Update - 20 October 2021

Forecast: Enterprise IT Spending for the Healthcare Provider Market, Worldwide, 2019-
2025, 2Q21 Update - 9 July 2021

Forecast: Enterprise IT Spending for the Healthcare Provider Market, Worldwide, 2019-
2025, 1Q21 Update - 14 April 2021

Forecast: Enterprise IT Spending for the Healthcare Provider Market, Worldwide, 2018-
2024, 4Q20 Update - 19 January 2021

Forecast: Enterprise IT Spending for the Healthcare Provider Market, Worldwide, 2018-
2024, 3Q20 Update - 16 October 2020

Forecast: Enterprise IT Spending for the Healthcare Provider Market, Worldwide, 2018-
2024, 2Q20 Update - 3 July 2020

Forecast: Enterprise IT Spending for the Healthcare Provider Market, Worldwide, 2018-
2024, 1Q20 Update - 7 May 2020

Forecast: Enterprise IT Spending for the Healthcare Provider Market, Worldwide, 2017-
2023, 4Q19 Update - 12 February 2020

Forecast: Enterprise IT Spending for the Healthcare Provider Market, Worldwide, 2017-
2023, 3Q19 Update - 3 November 2019

Forecast: Enterprise IT Spending for the Healthcare Provider Market, Worldwide, 2017-
2023, 2Q19 Update - 30 July 2019

Forecast: Enterprise IT Spending for the Healthcare Provider Market, Worldwide, 2017-
2023, 1Q19 Update - 6 May 2019

Forecast: Enterprise IT Spending for the Healthcare Provider Market, Worldwide, 2016-
2022, 4Q18 Update - 31 January 2019

Forecast: Enterprise IT Spending for the Healthcare Provider Market, Worldwide, 2016-
2022, 3Q18 Update - 6 November 2018

Gartner, Inc. | G00808905 Page 7 of 10

This research note is restricted to the personal use of [email protected].

 Forecast: Enterprise IT Spending for the Healthcare Provider Market, Worldwide, 2016-
2022, 2Q18 Update - 6 August 2018

Forecast: Enterprise IT Spending for the Healthcare Provider Market, Worldwide, 2016-
2022, 1Q18 Update - 1 May 2018

Forecast: Enterprise IT Spending for the Healthcare Provider Market, Worldwide, 2015-
2021, 4Q17 Update - 1 February 2018

Forecast: Enterprise IT Spending for the Healthcare Provider Market, Worldwide, 2015-
2021, 3Q17 Update - 27 October 2017

Forecast: Enterprise IT Spending for the Healthcare Provider Market, Worldwide, 2015-
2021, 2Q17 Update - 31 July 2017

Forecast: Enterprise IT Spending for the Healthcare Provider Market, Worldwide, 2015-
2021, 1Q17 Update - 28 April 2017

Forecast: Enterprise IT Spending for the Healthcare Provider Market, Worldwide, 2014-
2020, 4Q16 Update - 30 January 2017

Forecast: Enterprise IT Spending for the Healthcare Provider Market, Worldwide, 2014-
2020, 3Q16 Update - 14 October 2016

Forecast: Enterprise IT Spending for the Healthcare Provider Market, Worldwide, 2014-
2020, 2Q16 Update - 27 July 2016

Forecast: Enterprise IT Spending for the Healthcare Provider Market, Worldwide, 2014-
2020, 1Q16 Update - 27 April 2016

Forecast: Enterprise IT Spending for the Healthcare Provider Market, Worldwide, 2013-
2019, 4Q15 Update - 27 January 2016

Forecast: Enterprise IT Spending for the Healthcare Provider Market, Worldwide, 2013-
2019, 3Q15 Update - 7 October 2015

Forecast: Enterprise IT Spending for the Healthcare Provider Market, Worldwide, 2013-
2019, 2Q15 Update - 21 July 2015

Forecast: Enterprise IT Spending for the Healthcare Provider Market, Worldwide, 2013-
2019, 1Q15 Update - 14 April 2015

Forecast: Enterprise IT Spending for the Healthcare Provider Market, Worldwide, 2012-
2018, 4Q14 Update - 20 January 2015

Forecast: Enterprise IT Spending for the Healthcare Provider Market, Worldwide, 2012-
2018, 3Q14 Update - 13 October 2014

Gartner, Inc. | G00808905 Page 8 of 10

This research note is restricted to the personal use of [email protected].

 Forecast: Enterprise IT Spending for the Healthcare Provider Market, Worldwide, 2012-
2018, 2Q14 Update - 18 July 2014

Forecast: Enterprise IT Spending for the Healthcare Provider Market, Worldwide, 2012-
2018, 1Q14 Update - 9 April 2014

Forecast: Enterprise IT Spending for the Healthcare Provider Market, Worldwide, 2011-
2017, 4Q13 Update - 28 January 2014

Forecast: Enterprise IT Spending for the Healthcare Provider Market, Worldwide, 2011-
2017, 3Q13 Update - 4 October 2013

Forecast: Enterprise IT Spending for the Healthcare Provider Market, Worldwide, 2011-
2017, 2Q13 Update - 16 July 2013

Forecast: Enterprise IT Spending for the Healthcare Provider Market, Worldwide, 1Q13
Update - 17 April 2013

Forecast: Enterprise IT Spending for the Healthcare Providers Market, Worldwide, 2010-
2016, 4Q12 Update - 17 January 2013

Forecast: Enterprise IT Spending for the Healthcare Providers Market, Worldwide, 2010-
2016, 3Q12 Update - 18 October 2012

Forecast: Enterprise IT Spending for the Healthcare Provider Market, Worldwide, 2010-
2016, 2Q12 Update - 19 July 2012

Forecast: Enterprise IT Spending for the Healthcare Provider Market, Worldwide, 2010-
2016, 1Q12 Update - 11 April 2012

Forecast: Enterprise IT Spending for the Healthcare Provider Market, Worldwide, 2009-
2015, 4Q11 Update - 12 January 2012

Forecast: Enterprise IT Spending for the Healthcare Provider Market, Worldwide, 2009-
2015, 3Q11 Update - 12 October 2011

Forecast: Enterprise IT Spending for the Healthcare Provider Market, Worldwide, 2009-
2015, 2Q11 Update - 18 July 2011

Forecast: Enterprise IT Spending for the Healthcare Provider Market, Worldwide, 2009-
2015, 1Q11 Update - 15 April 2011

Forecast: Enterprise IT Spending for the Healthcare Provider Market, Worldwide, 4Q10
Update - 18 January 2011

Forecast: Enterprise IT Spending for the Healthcare Provider Markets, Worldwide, 3Q10
Update - 22 November 2010

Gartner, Inc. | G00808905 Page 9 of 10

This research note is restricted to the personal use of [email protected].

 Recommended by the Authors
Some documents may not be available as part of your current Gartner subscription.

Healthcare Provider, Payer and Life Science Industries Ecosystem Primer for 2024
Healthcare Provider Technology Insights Primer for 2024

U.S. Healthcare Payer Insurance Industry Insights Primer for 2024

Healthcare Provider Industry Overview: Kick-Starter for Technology Providers, 2024

© 2024 Gartner, Inc. and/or its affiliates. All rights reserved. Gartner is a registered trademark of
Gartner, Inc. and its affiliates. This publication may not be reproduced or distributed in any form
without Gartner's prior written permission. It consists of the opinions of Gartner's research
organization, which should not be construed as statements of fact. While the information contained in
this publication has been obtained from sources believed to be reliable, Gartner disclaims all warranties
as to the accuracy, completeness or adequacy of such information. Although Gartner research may
address legal and financial issues, Gartner does not provide legal or investment advice and its research
should not be construed or used as such. Your access and use of this publication are governed by
Gartner's Usage Policy. Gartner prides itself on its reputation for independence and objectivity. Its
research is produced independently by its research organization without input or influence from any
third party. For further information, see "Guiding Principles on Independence and Objectivity." Gartner
research may not be used as input into or for the training or development of generative artificial
intelligence, machine learning, algorithms, software, or related technologies.

Gartner, Inc. | G00808905 Page 10 of 10

This research note is restricted to the personal use of [email protected].