Global Medical Terminology Software Market Size and Trends

Global medical terminology software market is expected to reach US$ 5,231.5 Mn by 2030, from US$ 1,439.9 Mn in 2023, at a CAGR of 20.2% during the forecast period.

Global medical terminology software market is segmented into by product type, application, end user, and region. By product type, the market is segmented into services, platforms, and integrated platforms. The services segment accounts for the largest market share due to the recurring nature of services and their indispensability. Based on application, the market is segmented into data aggregation, reimbursement, clinical decision support, clinical trials, and others. The clinical decision support segment dominates the market, owing to the critical role played by medical terminology software in decision support systems. In terms of end user, the market is segmented into healthcare providers, healthcare payers, and healthcare IT vendors. The healthcare providers segment leads the market share due to utilization of the software to optimize clinical documentation.

Global Medical Terminology Software Market- Drivers

Need to Reduce Medical Errors and Improve Patient Safety: The need to reduce medical errors and improve patient safety is a major driver fostering growth of the global medical terminology software market. Medical errors arising from inaccuracies in clinical documentation can have severe implications on patient health. According to WHO, medication errors alone contribute to over 1 million patient harms each year globally. Medical terminology software enhances clinical documentation quality by integrating standard terminologies into EHRs and other healthcare IT systems. This pre-coordination of medical phrases and terms eliminates ambiguity and enhances clarity in clinical notes. Smooth data mapping and seamless integration of medical vocabulary enhances patient safety by reducing misinterpretation of clinical information. Medical terminology software is being increasingly adopted to minimize medical errors and advance patient safety.
Adoption of Electronic Health Record (EHR) Solutions: The growing adoption of electronic health records (EHR) and other healthcare IT solutions boosts demand for medical terminology software. EHR systems contain large volumes of patient health data recorded by multiple caregivers. Medical terminology software becomes indispensable in such systems to allow standardized capture, retrieval and interpretation of medical data. It enables aggregation of patient data from disparate systems into EHRs by seamlessly mapping different medical vocabularies. Medical terminology solutions enhance EHR functionalities such as clinical decision support, quality reporting and care coordination by integrating medical dictionaries into workflows.
Need to Curtail Healthcare Costs: The pressing need to curtail healthcare costs and enable better reimbursement outcomes is boosting demand for medical terminology software. Medical vocabulary management software allows the seamless capture of clinical data in a standardized form. This enhances the efficiency and accuracy of medical coding and billing processes. Accurate documentation and coding is imperative for securing optimal reimbursement outcomes. According to a survey, up to 90% of denied claims result from improper clinical documentation and coding. By integrating medical terminology into workflows, the software solution enhances coding precision. It also reduces billing errors and minimizes revenue leakage, and thus, driving better financial outcomes. The cost-curbing benefits offered by medical terminology software makes it an indispensable tool for healthcare organizations.
Regulatory Requirements Mandating Use of Standard Terminologies: Regulatory requirements making the use of standardized medical vocabularies mandatory boosts adoption of medical terminology software. Regional regulations such as the US' Meaningful Use Stage 2 uses terminologies such as SNOMED CT mandatory for EHR certification. International standards such as ICD-10 CM necessitate standardized capture of clinical data for smooth cross-border healthcare data exchange. Medical terminology software solutions enable seamless mapping and integration of such standardized vocabularies into healthcare IT systems and workflows. This allows care providers to comply with regulatory terminology requirements efficiently. The software tools are therefore becoming indispensable assets for healthcare organizations looking to comply with norms and access incentives linked to terminology adoption.

Global Medical Terminology Software Market- Trends

Demand for Semantic Interoperability Capabilities: The growing need for semantic interoperability is a key trend boosting demand for advanced medical terminology software. Lack of standardized capture of clinical data leads to challenges in healthcare data exchange across systems, care settings and borders. This hampers population health management and coordinated care delivery. Medical terminology solutions that allow semantic interoperability—consistent interpretation of data meaning across systems—address this gap. Solutions allowing enterprise-wide mapping to support use of multiple terminologies are gaining traction. Integration of terminology standards like SNOMED CT, ICD, RxNorm into EHRs is rising to achieve semantic interoperability.
Utilization of Mobile and Cloud Capabilities: Healthcare organizations are demanding medical terminology solutions harnessing mobility and cloud capabilities. With digitization, clinicians are relying on web and mobile apps to access medical vocabulary on-the-go for point-of-care use. Solutions utilizing responsive web design and cross-platform mobile apps are gaining prominence. Cloud-hosted solutions allowing anywhere anytime access via latest apps and browsers are also rising in demand. Cloud integrations also enable frequent updates to maintain dynamic curation of medical vocabulary. Medical terminology providers are enhancing their solutions with mobile capabilities and secure cloud integrations to provide easy access and seamless workflows for clinicians.
Application of Natural Language Processing: Natural language processing techniques are being increasingly integrated into medical terminology software solutions to automate clinical documentation workflows. NLP algorithms allow automated extraction of medical concepts and terms from unstructured physician notes. This eliminates the need for manual review and coordination of clinical notes with standard vocabularies. NLP techniques like text segmentation and named entity recognition identify medical phrases using vocabulary ontology and derive meaningful insights from free text. Solutions incorporating NLP deliver higher documentation throughput.
Increasing Consolidation among Vendors: The medical terminology software space is witnessing increasing consolidation through partnerships and acquisitions among vendors to enhance product capabilities. In February 2022, 3M a conglomerate company acquired LeanTec a software company to leverage its semantic search and NLP capabilities to advance 3M's terminology tools. The trend towards consolidation is likely to rise as vendors seek to derive synergies from combined complementary strengths to deliver end-to-end clinical terminology solutions.

Figure 2. Global Medical Terminology Software Market Share (%), By Application, 2023