U.S. Payment Integrity Market Size, Share, and Trends 2024 to 2033

U.S. Payment Integrity Market Size and Growth 2024 to 2033

The U.S. payment integrity market size was valued at USD 0.98 billion in 2023 and it is expected to reach around USD 10.27 billion by 2033, growing at a CAGR of 26% during the forecast period from 2024 to 2033.

U.S. Payment Integrity Market Key Takeaways

• By Component, the software segment contributed more than 63.10% of revenue share in 2023.
• By Function, the OLAP & visualization segment dominated the market and registered more than 40.10% revenue share in 2023.
• By Application, the post-payment segment accounted for more than 49.80% of revenue share in 2023.
• By Mode of Delivery, the on-premises segment dominated the market and captured more than 55.95% revenue share in 2023.
• By End Use, the healthcare providers segment led the market and contributed more than 64.75% of revenue share in 2023.

U.S. Payment Integrity Market Overview

The payment integrity industry is focused on reducing fraud, waste, and abuse in healthcare payments within the United States. It involves various technologies, solutions, and services aimed at identifying and preventing improper payments, improving claims accuracy, and enhancing overall payment processes. Payment integrity initiatives are particularly crucial in the healthcare sector, where fraudulent or erroneous payments have significant financial implications for government programs, private insurers, and healthcare providers. These initiatives strive to ensure that payments are made only for legitimate services and that billing and coding practices are accurate and compliant with regulations. The market in the United States is driven by the need to control healthcare costs, reduce fraud, and enhance operational efficiency in the payment ecosystem. Government programs such as Medicare and Medicaid, private insurers, and self-insured employers are among the main stakeholders invested in payment integrity initiatives.

U.S. Payment Integrity Market Scope

U.S. Payment Integrity Market Dynamics

Drivers:

Government initiatives to reduce improper payments

The U.S. government has implemented several initiatives to reduce improper payments, including the Payment Integrity Information Act (PIIA) and the Improper Payments Elimination and Recovery Improvement Act (IPERIA). These initiatives drive the adoption of payment integrity solutions in the government sector. Medicare's prior authorization program might profit from improved communication. This program compels recipients to obtain approval before obtaining specific items, such as motorized wheelchairs, and it has the potential to cut expenses and erroneous payments.

According to recent White House data, the erroneous payment percentage, including unexplained payments, decreased significantly in FY 2022—from 7.2% to 5.1%—even though several new programs, including pandemic assistance programs, were reported for the first time in years. This decrease is a significant step in the right direction and reflects ongoing efforts by OMB and Federal agencies to boost payment integrity, including the implementation of the Payment Integrity Information Act of 2019.

Increasing Electronic Medical Records (EMR) and Electronic Health Records (EHR) Applications for Payment integration

Convenience and safety are top priorities for both businesses and customers in the modern world. All healthcare providers accept payments, but when such systems are not integrated with patient EMRs or electronic health records, the process may seem complicated or out-of-date to the user. Payments are managed by healthcare professionals and patients in a simple, secure, and practical manner by integrating them into EMRs and EHRs.

Integrating payments into the EMR/EHR reduces difficulties and improves response rates because traditional billing is a burden to both the patient and the provider. An integrated platform allows for automatic billing, ensuring prompt invoice issuance and doing away with the laborious task of a collection specialist auditing patient accounts.

Restraints:

Fluctuation in medical loss ratios

Some health plans have postponed major technology expenditures due to the uncertainty surrounding the economy and how healthcare prices have affected medical loss ratios. Insurance company profits and operational margins fluctuate from quarter to quarter, which results in cautious financial projections. Taking on new technology initiatives may feel too hazardous in the short term, especially considering the historical problems, to swiftly and successfully move to digital processes. Nonetheless, health plans reduce this perceived risk by looking for solutions that produce rapid victories and position them for long-term benefits. Enterprise healthcare payer technology that prioritizes industry standards simplifies data sources, boosts productivity, and lessens team fear must show an advantage.

Opportunities:

Increasing engagement of players

Various new and unexcepted opportunities for player participation have emerged in recent years. The people in charge of their care want to communicate more with them. They have accepted technology into healthcare more broadly than ever before, including home health and telehealth.

Consumer healthcare costs are a significant source of personal financial stress at the same time. Furthermore, the total will exceed USD 491 billion and is expected to continue growing at a 10% annual rate in the foreseeable future.

Players have realized that offering better member services is an advantage in a market that is consumer driven. Customers view maintaining their health plan as crucial to having good medical experiences. The adoption of digital health will keep increasing as health insurers expand their coverage.

Impact of COVID-19:

The COVID-19 pandemic has significantly impacted the U.S. payment integrity market. With the pandemic, there has been a significant increase in healthcare spending, particularly for COVID-19-related care, as well as a surge in unemployment and related benefit payments. This increase in spending has put pressure on government agencies and healthcare payers to ensure that their payment systems are effective and efficient, which has led to an increased demand for payment integrity solutions. Payment integrity solutions help to identify and prevent improper payments, such as fraud, waste, and abuse, which have become more prevalent during the pandemic. At the same time, the pandemic has also disrupted the payment integrity market, with many organizations shifting their focus to COVID-19-related issues and delaying or canceling payment integrity initiatives. The pandemic has also led to a shift towards remote work and virtual operations, which has required payment integrity solutions to adapt to new security and privacy challenges.

Component Insights

The Software sector is anticipated to grow at the highest CAGR from 2024 to 2033. Artificial Intelligence and machine learning capabilities are frequently incorporated throughout applications, offering users capabilities such as digitization and predictive capabilities. Moreover, artificial intelligence software in payment integrity helps detect and gather evidence against fraud schemes. It also helps in deriving actionable insights and processes large volumes. Furthermore, artificial intelligence allows easy sharing of information between teams in the identification of behavior-based patterns. Overall, with software, the market for payment integrity will flourish, attributing to the use of artificial intelligence.

The services sector is growing at the fastest rate during the forecast period. The services segment of payment integrity refers to multiple solutions from the top organizations, such as secure payment, payment recovery, credit balance services, overpayment identification, and identification of coding errors. Many top key players providing payment integrity solutions are continuously updating their payment integrity solutions for smooth working and fraud-free transactions. Additionally, these services increase the provider's satisfaction as this technology-driven claim uses advanced algorithms with great potential for payment error detection, and it leads to the recovery of higher dollars.

U.S. Payment Integrity Market, By Component, 2022-2032 (USD Million)

Function Insights

Based on the function, the Query & Reporting sector is growing at the highest CAGR from 2024 to 2033. Query and Reporting is a critical part involving multi-step processes as it holds necessary for the specific workflow. Many firms provide the solution for these functionalities, although the design of this tool and its internal features differ. For example, the query reporting by the Cotiviti firm is done by QR web, which helps in efficient operations. Additionally, this function enables the enhancement of medical record reviews containing 100 advanced filters. The above-mentioned factor is anticipated to propel the market.

On the other hand, the OLAP & Visualization segment is expanding at a remarkable rate. Generally, online analytical processing refers to a set of software tools to analyze data to make business decisions. It provides a platform to extract information from the database system. Additionally, the OLAP database enables the user to examine several multidimensional data, which is critically important in decision management. Furthermore, OLAP and visualization allow the users to run complicated queries to retrieve this multidimensional data as well as due to the processing of OLAP; the data integrity or payment integrity is not compromised.

U.S. Payment Integrity Market, By Function, 2022-2032 (USD Million)

Application Insights

On the basis of application, the pre-payment sector is expected to grow at the fastest rate from 2024 to 2033. Claims editing pre-payment service is one of several cost-effective measures implemented during the healthcare reimbursement process to assure the accuracy of the medical bill. This method or service by a corporation protects the patient from overpaying for healthcare services and paying for items that should never have been paid for in the first place.

Furthermore, companies that practice claim editing help to use the regulation in effect on the date of services, improve workflow efficiency, and provide clear and complete disclosure with total transparency to the provider.

U.S. Payment Integrity Market, By Application, 2022-2032 (USD Million)

Mode of Delivery Insights

On the basis of the mode of payment, the on-premises sector is expanding at the highest CAGR from 2024 to 2033. Many companies opt for an on-premises mode of delivery for its numerous advantages such as it allows big corporations to have control over the server hardware without requiring third-party involvement. Additionally, the annual maintenance and one-time license charges are cheaper than compared cloud software, and there is no requirement for internet connectivity like that of cloud software.

The cloud-based segment is anticipated to expand at the fastest rate during the projected period. Cloud-based software enables the organization to manage and build IT resources. Additionally, the cloud-based segment requires no capital expense as well as no maintenance cost. Furthermore, cloud-based software performs all the software backups and processing, so the company needs no additional in-house IT team. Besides that, the security protocols of cloud-based are highly advanced with the internet connection that gives the advantage to the user for remote working.

U.S. Payment Integrity Market, By Mode of Delivery, 2022-2032 (USD Million)

End-User Insights

The payer segment is anticipated to grow at the highest rate from 2024 to 2033. In the U.S. healthcare system, payers refer to organizations that pay for healthcare services, such as insurance companies, government programs like Medicare and Medicaid, and self-insured employers. Payers play a crucial role in the healthcare system by providing financial coverage for medical expenses incurred by patients.

Some of the key types of payers in the U.S. healthcare system include Private insurance companies: Private insurance companies provide coverage for healthcare services through employer-sponsored plans, individual policies, and other types of plans. These companies negotiate rates with healthcare providers and pay for medical expenses incurred by patients.

U.S. Payment Integrity Market Recent Developments

• In April 2023, NTT DATA was introduced by NTT DATA To Help Organizations Deliver Bold Digital Experiences.
• In April 2023, Conduent launched First-of-Their-Kind Digital Payment Solutions for Tolling and Other Transportation Uses
• In March 2023, NTT, NTT DATA, And INDYCAR Extended Entitlement Partnership with Multi-Year Agreement.
• In December 2022, Cognizant acquired Integration.
• In September 2022, CyberCube announced a partnership with EXL.
• In September 2022, Zelis Completed the Acquisition of Payer Compass
• In March 2022, Orono acquired CERIS Group to Develop Its Activities in the Healthcare, Pharmaceuticals, and Biotechnology Sectors
• In December 2021, EXL acquired Clairvoyant, adding scale in data, AI, and cloud engineering.

U.S. Payment Integrity Market Companies

• Cotiviti
• Optum / Change Healthcare
• Zelis
• Availity
• MultiPlan
• Ceris
• Cognizant
• EXL
• Performant
• Syrtis
• Varis
• ClarisHealth
• ClaimLogiq
• Rialtic
• HealthEdge

Segments Covered in the Report:

By Component

• Software
• Services

By Function

• Query & Reporting
• OLAP & Visualization
• Performance Management

By Application

• Pre-Payment
  • Claims Editing (1st pass)
  • Claims Editing (2nd, 3rd, etc.)
  • Coding Validation
• Post-Payment
  • Complex/Clinical Provider Audit
  • Coordination of Benefits (COB)
  • Subrogation
  • Data Mining
• FWA
  • Provider Fraud, Waste & Abuse
  • Special Investigations
• Others
  • Reporting and Analytics
  • Others

By Mode of Delivery

• On-Premises
• Cloud-Based
• Hybrid

By End Use

• Payers
• Healthcare Providers