US Applied AI in Healthcare Market Research Report: By Offering (Hardware, Software, Services) - Forecast to 2035

US Applied AI in Healthcare Market Overview

As per MRFR analysis, the US Applied AI in Healthcare Market Size was estimated at 5.01 (USD Billion) in 2023. The US Applied AI in Healthcare Market Industry is expected to grow from 6.88(USD Billion) in 2024 to 165.55 (USD Billion) by 2035. The US Applied AI in Healthcare Market CAGR (growth rate) is expected to be around 33.524% during the forecast period (2025 - 2035).

Key US Applied AI in Healthcare Market Trends Highlighted

The US Applied AI in Healthcare Market is experiencing significant transformations driven by advances in technology and regulatory support. One key market driver is the increasing demand for efficient healthcare solutions, mainly due to rising patient expectations and a growing volume of patient data. This push for enhanced patient care is prompting healthcare providers to adopt AI technologies for better diagnostics, personalized treatment plans, and improved operational efficiency. Furthermore, there is a continuous effort from the US government to promote innovation in healthcare through initiatives that support digital health technologies.

For instance, the FDA has been actively working on frameworks to accelerate the development and approval of AI-based medical devices, fostering a supportive environment for AI in healthcare. Opportunities to be explored in the US market include the integration of AI with telehealth services, especially following the surge in remote healthcare during the pandemic. As healthcare delivery models evolve, telehealth combined with AI can lead to better patient outcomes and increased accessibility to medical services. There is also potential for AI-driven predictive analytics in managing chronic diseases, which requires ongoing attention and resources.

Recent trends show a growing collaboration between healthcare organizations and technology companies, focusing on developing AI systems that improve health outcomes and efficiency. Additionally, there is a noticeable shift towards using AI for administrative tasks, such as billing and appointment scheduling, allowing healthcare professionals to focus more on patient care. Overall, the US Applied AI in Healthcare Market is set on a path of rapid evolution, with numerous opportunities for growth and improvements in healthcare delivery.

Source: Primary Research, Secondary Research, MRFR Database and Analyst Review

US Applied AI in Healthcare Market Drivers

Rising Demand for Personalized Medicine

The US Applied AI in Healthcare Market Industry is experiencing substantial growth due to the increasing demand for personalized medicine. As healthcare shifts towards tailored treatments, AI technologies are being employed to analyze extensive datasets from clinical trials, genetic information, and patient history. The National Institutes of Health (NIH) highlighted that precision medicine can potentially reduce the prevalence of adverse drug reactions by 30%.Established organizations such as 23andMe and Illumina are leading the charge by integrating AI into genome sequencing and patient diagnostics, which is a significant factor driving market growth. With the market anticipated to grow from USD 6.88 billion to USD 165.55 billion by 2035, AI’s role in enhancing the understanding of individual patient needs is pivotal. Furthermore, a report from the FDA indicated that incorporating AI in clinical decision-making could lead to improved outcomes for 75% of patients, thus encouraging increased investment and research in this area.

Technological Advancements in AI Algorithms

Technological advancements in artificial intelligence algorithms are significantly influencing the growth of the US Applied AI in Healthcare Market Industry. The introduction of machine learning and deep learning has revolutionized data processing capabilities, healthcare providers can now leverage vast amounts of data for improved diagnostics and patient care. According to the American Medical Association, hospitals adopting AI have reported a 15% increase in efficiency in patient management.

Companies like Google Health are using AI for predictive analytics and disease detection, enhancing the accuracy of breast cancer screenings by as much as 94%, compared to traditional methods. As these advancements continue to emerge, the market trajectory is expected to accelerate, particularly in the adoption of AI for early disease diagnosis and management.

Increasing Healthcare Data Generation

The surge in healthcare data generation is fueling the expansion of the US Applied AI in Healthcare Market Industry. With the growing digitization of healthcare, it is estimated that by 2025, the total volume of healthcare data generated is expected to reach 2,314 exabytes. This provides a substantial opportunity for AI to analyze this data for insights and improved healthcare efficiency. The Health Information Management Systems Society (HIMSS) has noted that health organizations that implement AI solutions can process patient data up to 50 times faster than before.

Companies like IBM Watson Health are actively investing in AI solutions that enable healthcare providers to derive actionable insights from electronic health records. This increasing availability of robust health information enhances the impetus for AI integration in healthcare, solidifying its market growth.

Government Initiatives and Funding

Government initiatives and funding in the US are playing a critical role in advancing the Applied AI in Healthcare Market Industry. The U.S. Department of Health and Human Services has launched multiple initiatives, including the Health IT Strategic Plan aimed at promoting AI integration in healthcare systems. This plan encourages innovation and investment in technologies that enhance patient outcomes. The National Science Foundation announced grants exceeding USD 150 million specifically for AI research in healthcare, which is crucial in spurring development.

Additionally, the Center for Medicare and Medicaid Services (CMS) supports programs that utilize AI for predictive analytics, allowing providers to better serve at-risk populations. Such government backing not only aids in research and development but also reinforces stakeholder confidence in the future viability of AI advancements in the healthcare setting.

US Applied AI in Healthcare Market Segment Insights

Applied AI in Healthcare Market Offering Insights

The US Applied AI in Healthcare Market is experiencing significant growth, particularly in the Offering segment, which comprises Hardware, Software, and Services. This segment plays a critical role in driving innovation across the healthcare landscape. Hardware, encompassing the physical devices and platforms that enable the efficient implementation of AI technologies, is becoming increasingly sophisticated, supporting applications ranging from diagnostics to robotic surgeries. Software solutions are at the heart of this transformation by providing algorithms and machine learning capabilities that analyze vast amounts of data, enhancing decision-making processes.

Services, including implementation, maintenance, and training, are essential in ensuring that healthcare providers can integrate AI solutions effectively into their workflows. The ongoing digital transformation in the US healthcare system, propelled by increasing demands for efficiency and accuracy, has created favorable conditions for the expansion of the Offering segment. Rising investments in Research and Development (R&D) and collaboration between technology firms and healthcare institutions are further fueling advancements in this sector.

As the healthcare industry continues to navigate challenges such as rising costs and the need for personalized patient care, the Offering segment of applied AI is positioned to deliver targeted solutions that enhance patient outcomes and streamline operations. The robust market growth is also supported by favorable government initiatives aimed at promoting technological advancements in healthcare. Overall, the Offering segment is pivotal for the US Applied AI in Healthcare Market, with each category contributing uniquely to the overall advancement of healthcare technology and patient care enhancement.

Source: Primary Research, Secondary Research, MRFR Database and Analyst Review

US Applied AI in Healthcare Market Key Players and Competitive Insights

The competitive landscape of the US Applied AI in Healthcare Market is rapidly evolving, marked by innovative solutions aimed at enhancing patient care and operational efficiencies. As healthcare providers increasingly adopt advanced technologies, the integration of artificial intelligence has become a focal point for organizations seeking to optimize clinical workflows, improve diagnostic accuracy, and personalize treatment plans. There is a notable surge in investment and development within this sector, driven by the potential for AI to transform data management and patient interaction. Various players are attempting to carve out a share of this lucrative market by developing unique algorithms, machine learning applications, and data analytics tools tailored for healthcare applications. The interplay between established corporations and emerging startups is creating a dynamic environment where collaboration, partnerships, and competition are critical to maintain a competitive edge.

Alphabet has made notable strides within the US Applied AI in Healthcare Market, capitalizing on its robust technological infrastructure and vast data resources. The company's strengths lie in its extensive research capabilities and its commitment to innovation, providing it with a significant advantage in the healthcare AI sector. Alphabet’s focus on machine learning applications enhances clinical workflows by enabling healthcare providers to utilize predictive analytics and automated systems tailored for patient care. The organization aims to redefine healthcare delivery by leveraging its established AI expertise, working in collaboration with healthcare providers to create solutions that facilitate early diagnosis and efficient treatment plans. The company's market presence is bolstered by its partnerships with various hospitals and health organizations, allowing it to effectively translate advanced technology into practical healthcare applications. Alphabet's strategic investment in AI technologies is setting a benchmark for how healthcare data can be analyzed and optimized for improved outcomes.

Medtronic, a leader in medical technologies, also plays a critical role in the US Applied AI in Healthcare Market by integrating AI-driven solutions within its broad portfolio of products and services. The company focuses on essential areas including diabetes management, cardiac health, and surgical interventions, utilizing AI to enhance device performance and patient safety. Medtronic’s strengths lie in its commitment to innovation and the seamless integration of AI technology within its existing medical devices, which allows for real-time monitoring and data analysis. This capability is particularly advantageous in managing chronic conditions, as it facilitates proactive care through smart algorithmic adjustments. Medtronic has achieved significant market presence through strategic mergers and acquisitions that expand its technological capabilities and product offerings in AI. By continually pursuing advancements in machine learning and data integration, Medtronic is well-positioned to address complex healthcare challenges, improving treatment outcomes and reinforcing its competitive position in the market. The combination of innovative product development and collaborations within the healthcare ecosystem strengthens Medtronic's stature as a key player in the US Applied AI in Healthcare Market.

Key Companies in the US Applied AI in Healthcare Market Include

• Alphabet


• Medtronic


• CureMetrix


• Olify


• IBM


• Microsoft


• Health Catalyst


• Siemens Healthineers


• Philips


• GE Healthcare


• Zebra Medical Vision


• NVIDIA


• Amazon


• Epic Systems

US Applied AI in Healthcare Market Industry Developments

Recent developments in the US Applied AI in Healthcare Market have highlighted significant advancements and investments. In October 2023, Alphabet announced partnerships aimed at leveraging AI for predictive analytics in patient care, demonstrating its commitment to enhancing healthcare delivery. Meanwhile, in September 2023, Medtronic unveiled a new AI-driven algorithm designed to optimize management for diabetes patients, emphasizing the integration of technology in chronic disease management. Additionally, in August 2023, Amazon made headlines by enhancing its health technology services through AI, focusing on telehealth solutions.

The market has witnessed notable mergers and acquisitions, with IBM acquiring a healthcare AI startup in July 2023 to bolster its capabilities in data analysis and patient insights. Furthermore, Microsoft has expanded its healthcare initiatives by collaborating with various providers to develop AI solutions aimed at streamlining operations and improving patient outcomes. Over the past couple of years, investments from companies like Health Catalyst and Siemens Healthineers have significantly contributed to the growth of AI applications in diagnostics. This surge in activity reflects a broader trend of increased adoption of AI technologies across healthcare institutions in the US, reinforcing the potential for transformative impacts on patient care and operational efficiencies.

US Applied AI in Healthcare Market Segmentation Insights

Applied AI in Healthcare Market Offering Outlook

• Hardware


• Software


• Services

Report Attribute/Metric Source:	Details
MARKET SIZE 2018	5.01(USD Billion)
MARKET SIZE 2024	6.88(USD Billion)
MARKET SIZE 2035	165.55(USD Billion)
COMPOUND ANNUAL GROWTH RATE (CAGR)	33.524% (2025 - 2035)
REPORT COVERAGE	Revenue Forecast, Competitive Landscape, Growth Factors, and Trends
BASE YEAR	2024
MARKET FORECAST PERIOD	2025 - 2035
HISTORICAL DATA	2019 - 2024
MARKET FORECAST UNITS	USD Billion
KEY COMPANIES PROFILED	Alphabet, Medtronic, CureMetrix, Olify, IBM, Microsoft, Health Catalyst, Siemens Healthineers, Philips, GE Healthcare, Zebra Medical Vision, NVIDIA, Amazon, Epic Systems
SEGMENTS COVERED	Offering
KEY MARKET OPPORTUNITIES	Predictive analytics for patient outcomes, AI-driven diagnostic tools, Automated administrative tasks, Personalized treatment plans, Remote patient monitoring solutions
KEY MARKET DYNAMICS	Regulatory compliance, Data privacy concerns, Rapid technological advancements, Increasing healthcare costs, Demand for personalized medicine
COUNTRIES COVERED	US