Healthcare data analysts are paid well and have plenty of opportunity for career growth. Find out what healthcare data analysis involves, and how you can carve a career in the industry.
Data analytics is booming in every industry, and healthcare data analytics is no exception. It’s especially big business in the U.S., where the market hit a value of a whopping $31 billion in 2022.
Whether you’re a fresh graduate or are planning to make the shift from another industry, healthcare analytics offers a great many career opportunities. Healthcare analysts are in demand. They’re paid well. Plus, the role is hugely varied. The fact that healthcare is something we all need at one point or another in our lives also means job security—this is no fad industry.
So what does a healthcare data analyst actually do, and how do you become one? In this post, we’ll explore the topic in more depth:
- What does a healthcare data analyst do?
- How much do healthcare data analysts earn?
- What skills do you need to become a healthcare data analyst?
- How to become a healthcare data analyst
- Key takeaways
Let’s find out more.
1. What does a healthcare data analyst do?
As the name suggests, healthcare data analysts help improve healthcare outcomes using data from a variety of sources. Most commonly, healthcare analysts work on the business side of medicine, improving patient care, or streamlining the way things are run. Other names you might come across when looking for healthcare data analyst roles include healthcare business analyst, healthcare information management analyst, or simply, healthcare consultant.
What is the role of data analytics in healthcare?
Every data analyst has tasks and responsibilities specific to their role. In healthcare, the main aim is to spot patterns that can help improve clinical care, reduce costs, and help healthcare institutions run more efficiently and effectively. But which data do healthcare data analysts work with?
When people first hear about healthcare analytics, the first thing they often think of is directly improving medical outcomes. Medical records are a form of clinical data, which can be used to do this. Clinical data analysis is probably the oldest application of analytics in the medical industry. However, the level of insight we can now obtain from clinical data has increased vastly since the introduction of electronic health records (EHRs) in the United States and around the world. Collectively, the big data we have access to offers unprecedented, real-time insights. For instance, it can be used to reduce the risk for patients, improve the overall quality of care, and even to train artificial intelligence to diagnose cancers. Pretty impressive stuff!
Claims and costs data
Many healthcare analysts work for insurance providers or related organizations. Claims data generally refers to the information relating to patient claims and the subsequent medical interventions. Analyses of these data can be used in many ways. For instance, they might help medical institutions identify which medical areas to invest in, or to help insurers get a better grasp of their premiums. The data might also help identify areas where resources are being wasted or misused. The applications of claims data are very broad.
The pharmaceutical sector employs healthcare data analysts to support research and development, and to improve products and processes. For instance, several international pharmaceutical companies have an agreement in place to share historic cancer research data. They aim to accelerate the discovery and development of new cancer drugs. Pharma companies might also use data from genome sequencing or medical devices to target specific patients for clinical trials, ultimately improving the outcome of those trials (with more accurate data to use!)
Behavioral and sentiment data
Patient behavior and sentiment analysis might not be the first thing you consider when thinking of healthcare analytics. However, these are an increasingly vital aspect of the industry. Today it is far easier (and far more acceptable) to track people’s retail habits, personal preferences, and feedback. For example, patient feedback on specific medical interventions can now be monitored in real-time. This means good behaviors or habits can be promoted, while common issues can be identified and dealt with quickly. For example, if patients suggest that they’re dissatisfied with a particular drug or medical treatment, this could inform an information campaign. Behavioral and sentiment data are also commonly used by private companies to market their medical products.
In addition to these four key sources of healthcare data, analysts also work across the supply chain and in HR. As such, the opportunities for data analysts in the healthcare sector are extremely varied. This means novice healthcare data analysts have a multitude of exciting career paths to choose from.
2. How much do healthcare data analysts earn?
In addition to an array of fascinating career opportunities, healthcare data analysts are also paid pretty well. While data analysts, in general, tend to earn above the US national average (regardless of industry), the financial rewards tend to be even higher within the healthcare sector.
To illustrate this, we pooled data from the salary comparison site Payscale. In the United States (where healthcare data analysts are most sought after) you can expect to earn an annual salary of between $48K and $81K. This broad figure ranges from entry-level to more senior positions, but the median salary is $63K.
In other countries, where demand for healthcare data analysts is still emerging, the figures are a bit lower. For instance, in Germany, you can expect to earn between $40K and $71K (or €34K to €60K) and in the United Kingdom between $33K and $42K (or £25K to £32K). But these are still not bad salaries.
How much you earn in reality will depend on numerous factors, not just your experience. For instance, the structure of a country’s healthcare system is likely to impact how much data analysts can earn, while the sub-sector you work in matters too. For example, you’ll generally earn more in pharmaceuticals than in local government.
You can learn more about your earning potential in our comprehensive data analyst salary guide.
3. What skills do you need to become a healthcare data analyst?
With all going well, your initial entry into the healthcare industry should be relatively straightforward. Healthcare analysts rely on many of the same skills required of data analysts in any sector.
The only additional prerequisite is to have proven data analytics expertise, often in a more generic data analytics role. This isn’t always the case, but it’s not uncommon. Why? Because healthcare data analysis roles tend to specialize fast. Employers, therefore, want to know that you have the basics down before they hire you.
Many roles also require a bachelor’s degree in a relevant subject area, such as health information management. We’ll explore this a bit more in section four, but for now, let’s look at some entry-level healthcare data analyst job descriptions. If you haven’t already, you might want to take a glance at our guide to data analytics job descriptions and what they really mean.
Entry-level healthcare data analyst skills
We’ve trawled dozens of healthcare data analyst job descriptions and pooled the most common skills. They include things like:
- 2+ years of experience (either in healthcare or data analytics).
- A scientific degree—bachelor or master’s (desirable).
- Advanced proficiency in data wrangling and SQL.
- Experience with analytics tools likeTableau, Metabase, and Mixpanel.
- Desire to work at the intersection of healthcare and technology.
- Ability to explain complex models to technical and non-technical colleagues.
- Basic Python, R, or Ruby, and enthusiasm for broadening these skills.
- Competence in the Microsoft Office suite of applications (especially Excel) plus database and reporting software knowledge.
As you can see—excluding a scientific degree and past experience—these are all fairly standard skills for any entry-level data analyst role. Of course, you’ll also need certain soft skills, such as communication, good time management, presentation skills, and so on.
And what if you want to specialize within the healthcare sector? Let’s take a look.
Specialist healthcare data analyst skills
As your career in the healthcare industry progresses, the range of skills you need will also grow. Unfortunately, there’s no single list of software and skills that you can refer to. What you learn will vary greatly as your area of expertise becomes more focused. The necessary software and skills, therefore, depend on the role, the career path you’ve chosen, the type of data you’re working with, and which aspect of the analytics process you’re specializing in.
To offer a flavor, though, we’ve pooled some high-level examples of industry-specific knowledge you might need:
- Working with healthcare claims (for example, if you’re applying for a job with an insurance provider).
- Working with electronic health records (often, though not always, for roles in a clinical setting).
- Understanding of clinical classification systems, such as the International Classification of Disease (ICD).
- Experience with procedures such as the Healthcare Common Procedure Coding System (HCPCS).
- Knowledge of region-specific data standards, such as the US Risk Adjustment Processing System (RAPS) or the European Data Protection Supervisor (the healthcare equivalent of GDPR).
- SQL, alongside knowledge of relational databases, data warehouses, and data management principles (i.e. data science skills).
- Healthcare-specific business intelligence tools, such as physician-facing software like UpToDate and Definitive Healthcare.
- Practical knowledge of the sector, such as how hospitals are run, how diseases and illnesses progress, or experience as a healthcare practitioner.
As this demonstrates, the required skills in healthcare analytics can quickly become quite niche! But don’t worry—as a newly-qualified data analyst, you won’t be expected to know all of these things. We merely wanted to offer an idea of the industry-specific knowledge you’ll gradually need to accumulate. Consider this your first taste of what the future might hold!
4. How to become a healthcare data analyst
Presuming you’ve got this far and still want to become a healthcare data analyst, how would you go about it?
Entry-level healthcare analysts don’t usually require specialist knowledge, but they will be expected to pick up new skills fast. The reality is that “healthcare analyst” is not so much a single job title as a broad term for many different roles. You might work in any number of different disciplines or be employed by various organizations, from government departments to private or public hospitals, multinational companies, and insurance providers. This is not a one-size-fits all industry!
If you want to become a healthcare analyst, you’ll gradually need to build particular domain knowledge and technical skills that relate to the broader field of data science (as well as the healthcare industry). To get to grips with this, we highly recommend checking out our guide on how to transition from data analytics to data science.
For now though, here are some simple steps to help you flourish:
Step 1: Get a bachelor’s degree
Many healthcare data analytics positions require, at a minimum, a bachelor’s degree in a relevant field. Don’t worry, though—“relevant” here is a pretty broad term. It can be anything from IT or computer science to maths, statistics, or a domain-specific degree in a healthcare-related subject. Eventually, when you take the next step up on the career ladder, you might want to consider a master’s or Ph.D. This isn’t something to worry about if you’re new to data analytics, but it’s good to keep the future in sight.
Step 2: Get a data analytics certification
Having a degree is useful for proving your knowledge of a specific domain area. However, you’ll also need to prove your data analytics expertise. This is especially important if you’re hoping to break directly into the healthcare industry without a lot of work experience. Our guide to the best data analytics bootcamps is a good place to start, but you can also look for a health-specific data analyst qualification. For example, in the US, the American Health Information Management Association (AHIMA) offers a range of technical qualifications to help you develop your skills in this area.
Step 3: Get the right work experience
If you can, obtain some experience in fields relating to different aspects of healthcare. Once again, this is broad, so you can work it in your favor. For instance, human resources, personnel management, systems technology, product research and development, even sales and marketing… These are all invaluable skills that can be applied in the healthcare industry. Naturally, nothing beats direct work experience. But, if that’s not feasible, consolidate your knowledge in other ways; explore different areas that interest you in your spare time and keep up with industry trends.
Step 4: Speak to someone in the industry
Whether you know someone personally or through a friend, try to speak to someone who works in the healthcare industry. Ideally, this should be a fellow data analyst. But if you know a doctor, a nurse, another healthcare professional, or just somebody who works in insurance, take the opportunity to ask them about what they do. What does their job involve? How do they use data? Where could novel analytics approaches help them to do their job better? Ultimately you want to learn as much about the industry as you can. Be like a sponge!
If you’re a recent graduate, you might want to do some of these things before applying for your first healthcare analytics role. Alternatively, if you’re more experienced, why not make the shift into healthcare right now? Whichever category you fall into, there are many paths to pursue in this exciting and fast-developing sector. And remember, whichever route you pursue within the data analytics field, it’s important to make sure your portfolio reflects your skills and interests. You can learn how to build a professional data analytics portfolio here.
5. Key takeaways
In this post, we’ve explored what a healthcare data analyst is, and how you might break into the industry. We’ve explored how:
- Healthcare data analysts work with a wide variety of data; including those from electronic health records, clinical trials, devices, and patient surveys.
- The opportunities and career paths are broad, and the financial rewards are compelling. Data analysts in the US earn a median salary of $63K.
- To start your career as a successful healthcare analyst, you’ll benefit from a bachelor’s degree and a relevant data analytics certification.
- Once you’ve established yourself in the industry, you can progress into data science, with healthcare as your specialist area of expertise.
While we’re living in an uncertain world, healthcare is one thing people will always need. This makes healthcare analytics a great career path if you’re seeking job stability. Plus, you’ll be contributing to improved patient care…that’s got to be rewarding, too!
If you’re new to data analytics, why not dip into our free, five-day data analytics short course? Alternatively, learn more about the topic and check out the following: