Digital Identity in Healthcare Market – Global Industry Size, Share, Trends, Opportunity, and Forecast, Segmented By Patient Identity (Electronic Health Records, Patient Portals), By Pharmacy & Medication (E-Prescribing, Medication Tracking), By Provider Identity (Credentialing & Licensing, Access Control), By Region & Competition, 2021-2031F

Forecast Period	2027-2031
Market Size (2025)	USD 3.75 Billion
CAGR (2026-2031)	15.19%
Fastest Growing Segment	Access Control
Largest Market	North America
Market Size (2031)	USD 8.76 Billion

Market Overview

The Global Digital Identity in Healthcare Market will grow from USD 3.75 Billion in 2025 to USD 8.76 Billion by 2031 at a 15.19% CAGR. Digital identity in healthcare encompasses the verification frameworks and credentialing systems utilized to authenticate the identities of patients, practitioners, and medical devices across the care continuum. The market is primarily driven by the critical need to secure electronic health records against unauthorized access and the escalating requirement to combat medical identity fraud. Furthermore, strict regulatory mandates regarding patient data privacy and the operational necessity to streamline access management in increasingly complex digital ecosystems support the widespread adoption of these solutions.

Despite these growth factors, the expansion of the market faces a significant challenge in the form of sophisticated cybersecurity threats that compromise sensitive patient data and erode trust in digital systems. The prevalence of these vulnerabilities highlights the urgent struggle to maintain robust security protocols amidst rapid technological integration. According to the American Hospital Association, in 2024, healthcare organizations reported 725 large data breaches to the Department of Health and Human Services, impacting a record 259 million individuals.

Key Market Drivers

The escalating frequency of healthcare cyberattacks and data breaches acts as a primary catalyst for the adoption of robust digital identity solutions. As threat actors increasingly target medical databases to exploit valuable personal health information (PHI), organizations are compelled to abandon traditional password-based defenses in favor of advanced identity and access management (IAM) protocols. This shift is critical to preventing unauthorized lateral movement within hospital networks and ensuring that only verified personnel can access sensitive patient records. The urgency of this transition is underscored by the sheer volume of hostile activity directed at the sector. According to Check Point Research, September 2024, in the 'CPR data reports 32% rise this year' update, the global healthcare sector experienced an average of 2,018 weekly cyberattacks per organization, marking a 32 percent increase compared to the previous year.

Simultaneously, government-led national digital health identity initiatives are creating a structural foundation for market growth by funding the modernization of legacy systems. Public sector mandates are forcing a transition toward interoperable electronic health records (EHR) and unified patient identifiers, which require sophisticated credentialing frameworks to function securely across different regions. These large-scale infrastructure projects not only standardize patient data access but also incentivize private investment in compliant identity technologies. For instance, according to HTN Health Tech News, March 2024, in the 'Government announces budget for long term growth' report, the UK government allocated £3.4 billion in capital investment specifically for NHS digital transformation and technology modernization over the forecast period. This drive for modernization is further justified by the financial stakes involved; according to IBM, in 2024, the average cost of a data breach in the healthcare industry reached $9.77 million, the highest of any sector.

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Key Market Challenges

The expansion of the Global Digital Identity in Healthcare Market is significantly impeded by the relentless escalation of sophisticated cybersecurity threats. As healthcare organizations increasingly digitize patient records and access protocols, they become prime targets for malicious actors, resulting in severe financial and reputational damage that diverts critical resources away from adopting advanced identity management solutions. The widespread fear of data compromise creates hesitation to implement centralized digital identity frameworks, as these systems are often perceived as potential single points of failure that require impeccable security.

This apprehension is substantiated by the profound operational disruptions observed across the industry, which drain the capital necessary for technological innovation. According to the American Medical Association, in 2024, a survey revealed that 80% of physician practices reported lost revenue due to the cyberattack on Change Healthcare, with 85% having to commit additional staff time and resources to mitigate the fallout. Such draining of financial reserves and workforce capacity forces institutions to prioritize immediate remediation and basic defensive measures over the investment in next-generation digital identity technologies, thereby stalling market growth.

Key Market Trends

Integration of AI-Driven Adaptive Authentication
The rapid sophistication of generative AI has necessitated a fundamental shift in identity verification, compelling the healthcare sector to integrate AI-driven adaptive authentication mechanisms. Traditional static credentials are proving insufficient against advanced threats such as deepfakes and synthetic identity fraud, driving organizations to adopt dynamic systems that analyze user behavior and context in real-time. This trend is characterized by the deployment of machine learning algorithms that continuously assess risk levels during user sessions, allowing for frictionless access when trust is high while instantly challenging anomalies. This evolution is critical not only for security but also for operational resilience, as many institutions currently lack adequate defenses against these automated attacks. According to Ping Identity, April 2024, in the 'Fighting The Next Major Digital Threat' report, only 27% of healthcare organizations have successfully implemented a strategy to specifically protect against such AI-generated identity threats.

Transition Toward Mobile-Centric Health Credential Wallets
Simultaneously, the market is witnessing a decisive transition toward mobile-centric health credential wallets, driven by patient demand for unified and portable control over medical data. Unlike fragmented provider portals that lock data within siloed systems, these digital wallets empower individuals to aggregate prescriptions, test results, and insurance details into a single, secure application on their personal devices. This shift prioritizes user experience and accessibility, reducing the administrative friction associated with managing care across multiple providers. As consumers increasingly expect healthcare interactions to mirror the convenience of digital banking and retail, providers are prioritizing mobile-first strategies to improve patient engagement and retention. This preference is strongly reflected in consumer behavior; according to RXNT, February 2025, in the '2024 Healthtech Perspectives Report', 55% of U.S. consumers now prefer to use a mobile application to manage their healthcare appointments, prescriptions, and medical records rather than traditional methods.

Segmental Insights

The Access Control segment is currently the fastest-growing category in the Global Digital Identity in Healthcare Market, driven by the urgent requirement to secure Protected Health Information (PHI) against escalating cyber threats. This accelerated adoption is underpinned by the transition to Zero Trust security models, which necessitate granular management of user privileges across expanding telehealth and remote networks. Additionally, compliance with rigorous mandates from regulatory frameworks, notably the Health Insurance Portability and Accountability Act (HIPAA) and the General Data Protection Regulation (GDPR), compels healthcare organizations to implement comprehensive access governance systems, ensuring sustained segment expansion.

Regional Insights

North America leads the global digital identity in healthcare market due to strict regulatory mandates and established healthcare infrastructure. The Health Insurance Portability and Accountability Act (HIPAA) requires United States healthcare providers to implement rigorous data privacy measures, directly driving the adoption of secure identity management solutions. Furthermore, the high prevalence of medical identity fraud encourages investment in verification technologies to protect patient records. Government support for electronic health record integration necessitates strong access controls to prevent unauthorized data breaches. These factors collectively ensure that North America remains the dominant region for digital identity adoption in healthcare.

Recent Developments

• In December 2025, Clear announced a major agreement with the Centers for Medicare & Medicaid Services to modernize the digital identity infrastructure for the Medicare.gov platform. Under this contract, the company implemented its "Clear1" identity verification solution, which leverages biometric technology to authenticate users for account access and recovery. This deployment replaced legacy knowledge-based authentication methods with a more secure, high-assurance standard compliant with federal guidelines. The initiative was launched to safeguard sensitive beneficiary data against identity theft while simplifying the user experience for millions of individuals accessing public healthcare services.
• In October 2025, ID.me formed a strategic partnership with Flexpa to streamline digital identity verification for patient health data access. This collaboration involved integrating the company's digital identity wallet with Flexpa’s application programming interfaces to facilitate the secure, interoperable exchange of medical records. The joint solution allowed patients to verify their identity a single time and securely share clinical data across disparate systems without repetitive login hurdles. Designed to align with federal interoperability frameworks, this initiative aimed to mitigate identity fraud and improve the efficiency of health information exchange for providers, payers, and patients.
• In December 2024, SailPoint Technologies announced a strategic partnership with Imprivata to deliver a unified identity security framework tailored specifically for the healthcare industry. As part of this collaboration, SailPoint agreed to acquire Imprivata’s Identity Governance and Administration business, integrating these capabilities into its Identity Security Cloud platform. The alliance focused on addressing complex access management challenges, such as securing non-employee identities and streamlining clinical workflows. By combining their strengths, the companies aimed to provide a comprehensive solution that ensures regulatory compliance and protects critical infrastructure against evolving cyber threats in the healthcare sector.
• In October 2024, Microsoft unveiled advanced data and artificial intelligence solutions to support healthcare organizations in managing digital identities and clinical workflows. At the HLTH 2024 conference, the technology giant introduced the healthcare agent service in Copilot Studio, enabling the creation of specialized agents for tasks such as appointment scheduling and clinical trial matching. Furthermore, the company launched new healthcare AI models in Azure AI Studio capable of analyzing diverse data modalities. These innovations aimed to reduce administrative burdens and enhance the security and efficiency of patient data management within the Microsoft Cloud for Healthcare ecosystem.

Key Market Players

• IBM Corporation
• Microsoft Corporation
• Oracle Corporation
• Epic Systems Corporation
• Veradigm LLC
• FF HealthKey Ltd
• Imprivata, Inc
• Medical Information Technology, Inc.
• McKesson Corporation
• SAP SE
• RSA Security LLC
• Verizon Communications Inc

By Patient Identity	By Pharmacy & Medication	By Provider Identity	By Region
Electronic Health Records Patient Portals	E-Prescribing Medication Tracking	Credentialing & Licensing Access Control	North America Europe Asia Pacific South America Middle East & Africa

Report Scope:

In this report, the Global Digital Identity in Healthcare Market has been segmented into the following categories, in addition to the industry trends which have also been detailed below:

• Digital Identity in Healthcare Market, By Patient Identity:

• Electronic Health Records
• Patient Portals

• Digital Identity in Healthcare Market, By Pharmacy & Medication:

• E-Prescribing
• Medication Tracking

• Digital Identity in Healthcare Market, By Provider Identity:

• Credentialing & Licensing
• Access Control

• Digital Identity in Healthcare Market, By Region:

• North America
• United States
• Canada
• Mexico
• Europe
• France
• United Kingdom
• Italy
• Germany
• Spain
• Asia Pacific
• China
• India
• Japan
• Australia
• South Korea
• South America
• Brazil
• Argentina
• Colombia
• Middle East & Africa
• South Africa
• Saudi Arabia
• UAE