|
As indicated by BPO service provider Business process outsourcing is booming, Healthcare business process outsourcing (BPO) service provider Zavata India's US$80 million contract with four major U.S. hospitals in November last year is a healthy example of the booming healthcare BPO services sector. More than half of U.S. hospitals are offshoring various components of healthcare services the share of work from hospitals forms 20 percent of the total medical billing and coding work sent to Indian vendors.
Offshoring of healthcare revenue cycle management services is set to gain traction this year, with Zavatas deal likely to set a strong precedent for more contracts involving turnkey end-to-end revenue cycle management (RCM) services. Amass
Outsourcing in Most Hospitals
A range of services beginning from the admission to post-discharge of a patient including medical coding, billing, medical transcription, claims generation, patient follow-up, etc. all are referred to as revenue cycle management.
More than half of the U.S. hospitals are directly or indirectly offshoring various components of healthcare services, offshore vendors can now expect more end-to-end work, according to a recent report by Pune-based market research firm ValueNotes.
The study says the share of work from hospitals forms 20 percent of the total medical billing and coding work offshored to Indian vendors.
Although the market is currently small, total revenue earned by players in 2006 was $125 million.
This is expected to more than triple by 2011, while the number of employees engaged in billing and coding will increase to 17,500.
Rising cost pressures coupled with increasing workloads are forcing healthcare institutions to explore outsourcing and offshoring options.
At present most offshore vendors focus on either large hospitals or the physician market space.
Mid-Size Hospitals
In the future, vendors offering RCM services can look to tap a huge opportunity from the relatively unaddressed and large segment consisting of mid-size hospitals in the U.S.
So far, this segment had been beyond the radar of most vendors, but the Zavata deal, which demonstrates the rising comfort level with offshoring by mid-sized hospitals, is likely to spark off a new wave of deals.
|