Cared For: Healthcare Consultants in the US Industry Market Research Report Now Available from IBISWorld

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Healthcare is often related to doctors, nurses and patients; yet, healthcare companies are businesses. Healthcare employers, hospitals, insurance companies, pharmaceutical developers and medical device manufacturers turn to consultants to improve operating efficiencies and manage risk. During the five years to 2012, demand for healthcare consultants has increased, due to technological advances in the healthcare sector and the changing regulatory environment. Nonetheless, IBISWorld estimates that revenue for the Healthcare Consultants industry is expected to decrease during the period to $9.6 billion. In recent years, companies have increasingly used healthcare consultants as corporate profit has improved. Further, the industry’s relatively strong profit margin has enticed entrants into the industry. As a result, revenue is set to grow over the next five years. For this reason, industry research firm IBISWorld has added a report on the Healthcare Consultants industry to its growing industry report collection.

IBISWorld Market Research

IBISWorld Market Research

Healthcare firms will demand consultants to manage risk and handle reform

Healthcare is often related to doctors, nurses and patients; yet, healthcare companies are businesses. Healthcare employers, hospitals, insurance companies, pharmaceutical developers and medical device manufacturers turn to consultants to improve operating efficiencies and manage risk. During the five years to 2012, demand for healthcare consultants has increased, due to technological advances in the healthcare sector and the changing regulatory environment. Nonetheless, revenue for the Healthcare Consultants industry is expected to decrease at an average of 0.8% per year during the period to $9.6 billion. According to IBISWorld industry analyst Sophia Snyder, “the fall in revenue is mainly due to the recession, which forced healthcare companies, like many other types of businesses, to cut costs.”

Some healthcare companies initiated the use of consultants to stay in the black by getting advice on improving efficiencies. In recent years, companies have increasingly used healthcare consultants as corporate profit improved. In 2012, revenue is expected to increase 5.7%, as demand continues to rise. Industry operators have subsequently been able to charge higher fees. Snyder says, “this trend has particularly occurred as specialty services develop and consulting becomes more technical.” Rising operating profit will be more evident during the next five years as major parts of healthcare reform are implemented. In 2017, profit margin is forecast to reach 20.3%, up from 19.8% in 2012. In line with profit growth, in the five years to 2017, industry revenue is forecast to grow.

This relatively strong profit margin has enticed entrants into the industry. The number of niche independent practices has declined moderately during the past five years, as general consulting firms acquired these companies to gain entrance into the market. The number of companies is expected to increase at an average of 0.9% per year during the five years to 2012 to 39,495. This percentage represents a slowing in company growth from the previous five-year period. During the next five years, this trend is forecast to reverse, with growth in companies accelerating. Niche companies are projected to enter the industry at a faster rate to meet mounting demand, as healthcare companies look to comply with new regulations associated with healthcare reform. Electronic health record (EHR) implementation will likely be a significant growth area for the industry. The industry is in the midst of a shift in concentration, evidenced in opposing trends among small and large players. While concentration is low in the industry as a whole, there is increasing concentration among major companies. Existing firms compete in terms in price, quality, aggressiveness of contracts and breadth of services offered. In pursuit of this last basis of competition, major companies Deloitte, IMS Health and PricewaterhouseCoopers have aggressively expanded in the past five years.

For more information visit IBISWorld’s Healthcare Consultants in the US industry page

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This industry provides specialist advice to businesses that are involved in the healthcare fields, such as hospitals, physicians, pharmaceutical companies and insurance providers. These services include advice related to financial management, human resources, information technology and other operations.

IBISWorld industry Report Key Topics

Industry Performance
Executive Summary
Key External Drivers
Current Performance
Industry Outlook
Industry Life Cycle
Products & Markets
Supply Chain
Products & Services
Major Markets
Globalization & Trade
Business Locations
Competitive Landscape
Market Share Concentration
Key Success Factors
Cost Structure Benchmarks
Barriers to Entry
Major Companies
Operating Conditions
Capital Intensity
Key Statistics
Industry Data
Annual Change
Key Ratios

About IBISWorld Inc.
Recognized as the nation’s most trusted independent source of industry and market research, IBISWorld offers a comprehensive database of unique information and analysis on every US industry. With an extensive online portfolio, valued for its depth and scope, the company equips clients with the insight necessary to make better business decisions. Headquartered in Los Angeles, IBISWorld serves a range of business, professional service and government organizations through more than 10 locations worldwide. For more information, visit http://www.ibisworld.com or call 1-800-330-3772.

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Gavin Smith
IBISWorld
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