Acute Cost and Growth Pressures to Drive Large-Scale BPO and ITO Outsourcing/Offshoring in Healthcare Sector over Next Three to Five Years

July 08, 2008 09:30 AM EDT | BUSINESS WIRE

HOUSTON — The slumping economy may be slowing deal flow in some sectors, but it is accelerating adoption of outsourcing in the healthcare industry as it struggles to streamline its back-office and ramp up to meet increased demand for services as the U.S. population ages, according to EquaTerra, a leading business advisory firm. In its newly released poll of leading outsourcing service providers on the state of the healthcare outsourcing market, EquaTerra expects these competing macro economic trends to drive large-scale outsourcing and offshoring deals over the next three to five years, especially in business process and information technology outsourcing (BPO and ITO).

Half of the respondents to EquaTerra’s 2Q08 Healthcare BPO/ITO Service Provider Pulse Survey* report demand is up quarter over quarter and 70 percent expect an increase next quarter. The scope of healthcare outsourcing is expanding too as healthcare organizations attempt to gain efficiencies through greater automation, self-service capabilities and improved IT infrastructure and functionality.

Typically, healthcare companies that are currently outsourcing have already reduced labor costs. Now, they want to achieve business process improvements via technology, business process reengineering and implementation of Six Sigma methodologies. As a result, they are prioritizing their outsourcing goals and focusing on functions and processes core to healthcare front and back-office operations. Seventy percent of healthcare services providers polled cited vertical healthcare business service areas, like claims administration and revenue cycle management (RCM) as the top areas of outsourcing demand in the market today.

Outsourcing buying patterns also appear to be changing. There is an emerging trend toward consolidating work sourced to several providers (e.g. claims imaging, data entry and claims processing) to a single, large vendor that can handle the entire claims function. In addition to standard BPO services, the clear expectation from this single-source solution is overall business transformation plus value-added knowledge services, including claims analytics, collections and reserve forecasting.

The survey also indicates more healthcare industry work is moving offshore to both India-based and multinational service providers. IT infrastructure monitoring and support along with RCM were identified as the two functions using the highest levels of offshore talent. Cost reduction continues to be a major impetus, but there’s also a significant shift to more strategic activities, according to 65 percent of the survey participants. As a result, outsourcing buyers are migrating from a contract labor model to longer-term, project-based work and multi-year outsourcing efforts that require greater control over functions and processes. Service providers cited the top two drivers for the increased use of offshore resources as immediate access to expertise and talent (50 percent) and knowledge services (42 percent).

To compete for this upscale work, outsourcing providers are developing more compelling offerings, according to Mark Voytek, healthcare industry practice lead for EquaTerra. “Healthcare companies need tools that support effective fiscal management and IT applications that can automate clinical processes and assist in improving quality, especially reducing medical errors. The low upfront costs associated with outsourcing versus a total-cost-of-ownership model is especially attractive in the current economy.”

Voytek’s thoughts are echoed by an executive from a leading healthcare service provider who says escalating costs and cuts in Medicare and Medicaid payments coupled with the increased demand of an aging population threaten the solvency of many U.S. hospitals. “Sixty percent of U.S. hospitals are already unprofitable and rely on charity and donations for supplemental funding. Cuts in claims payouts will further shrink revenues just as more Americans will utilize health services. The number of hospitals that are highly unprofitable will grow unless they adopt large-scale outsourcing and offshoring to reduce overall cost levels.”

Top-line finds from the 2Q08 Healthcare Service Provider Pulse Survey:

• Outsourcing service providers (82 percent) said the healthcare payer industry exhibits the greatest demand for BPO and ITO services. The healthcare provider market ranked second (73 percent.)
• Costs savings are still paramount, but 75 percent of the service providers polled report buyers are putting greater emphasis on process improvement, innovation and transformation.
• EquaTerra estimates approximately 75 IT and BPO deals were initiated from 2004 through 2007 with a total contract value (TCV) of $50 million. Of these, 75 percent were ITO deals and 25 percent were BPO. To date, healthcare represents less than five percent of total outsourcing deals in the market, highlighting the relative immaturity of the healthcare outsourcing market as compared to other industries like banking, financial services and manufacturing. But the healthcare outsourcing market is expected to grow at close to 10 percent over the next five to seven years, faster than overall market growth of seven to eight percent.

“The use of offshore and global resources in healthcare outsourcing is accelerating,” said Stan Lepeak, managing director of research for EquaTerra. “In fact, deteriorating economic conditions will likely drive more outsourcing in the healthcare market over the next several quarters.”

*About the 2Q08 Healthcare Industry Pulse Survey

EquaTerra recently polled top outsourcing service providers in the healthcare market. Based on these findings and its own direct market experience, the company mapped the level of buyer demand across several sets of emerging BPO and ITO functions and processes specific to the healthcare space. The demand-level ranking is based on a 1 to 10 scale, with 1 equating to low buyer demand, 5.5 to moderate demand and 10 to high levels of demand. Service providers were asked to comment on current demand and projected levels for the balance of 2008. For more details or to obtain a copy of this survey, please contact Stan Lepeak.

About EquaTerra

EquaTerra sourcing advisors help clients achieve sustainable value in their IT and business processes. Our advisors average more than 20 years of industry experience and have supported over 2000 transformation and outsourcing projects across more than 60 countries. Supporting clients throughout the Americas, Europe, Middle East, Africa and Asia Pacific, we have deep functional knowledge in Finance and Accounting, HR, IT, Procurement and other critical business processes. EquaTerra helps clients achieve significant cost savings and process improvement with internal transformation, shared services and outsourcing solutions. For more information, please contact Lee Ann Moore at +1 713.669.9292; leeann.moore@equaterra.com; www.equaterra.com.

 

Medical Transcription in India: A challenging career option!

Upendra Singh | MyNews.in
1/7/2008, 7:04:10 PM(IST)

Medical Transcription is one of the fastest growing fields in health care business in Western countries, especially in the US where the entire healthcare industry is based on insurance, and detailed medical documents are needed for processing insurance claims. Therefore, the hospitals and doctors avail medical transcription services to cater with the demands of documental records, basically outsourcing the business. In the last few years, India has shown an unprecedented success in this field of medical transcription cashing in on the outsourced business from US and other western countries.

Medical Transcription provides an exciting and challenging job option with an ever expanding knowledge based career. It is the process whereby a medical transcriptionist has to accurately and swiftly transcribe medical records dictated by doctors and their associates comprising of history and physical reports, clinical notes, office visit notes, operative reports, consultation notes, discharge summaries, official letters, psychiatric evaluations, laboratory reports, x-ray and MRI reports and pathology reports. A medical transcriptionist is a person who carries out the process of converting the voice format of medical data into text data.

The data is received in the form of digital data files and voice data files and converted into text format in the process of transcription. There are certain prerequisites to convert those voice files into text documents which basically involve transcription and editing. To ensure maximum accuracy, the editing part of the transcribed files include quality checking, visual proofreading, spelling checks, grammatical corrections, rephrasing to streamline the context, and removal of inconsistencies and illogical content so that the desired accuracy of at least 98% is met before being uploaded back to the clients.

India provides an ideal locale for conducting medical transcription work with a large population of educated English speaking people, a large pool of IT professionals, the internet revolution, and the computer-savvy new generation aided by free market policy. Advancement in technology has tremendously metamorphosed the global economy and work place and the field of medical transcription has undergone tremendous progress because of constant advances in communication and Internet technology. Majority of the work is outsourced from US, but even British and Australian doctors are beginning to consider India as a possible source of getting this work done-quickly and efficiently.

Outsourcing of medical transcription work to India has the direct and immediate advantage of cost reduction, reliability in turnaround time, and total document security. The comparative low cost in India to those of US or other developed countries serves as an encouragement for companies abroad to outsource their work to the Indian Medical Transcription field thereby making India to be one of the top destinations of medical transcription industry. Turnaround time is critical in this industry, and India, because of its advantageous time zone in comparison to America and Europe, holds the advantage of delivering the work the very next working day for them.

India witnessed a boom in medical transcription field a few years back with a plethora of companies and training institutes mushrooming all over the place, but due to lack of training, experience and planning, most of them went into oblivion. Those who augured well with this new concept of business still persist and are providing job opportunities to thousands. The success of the surviving companies is a kind of indication that medical transcription, if handled appropriately, has the capability of creating opportunities and maneuvering the Indian job scenario to an extent.

Transcription services in India range from small, one-person home-based businesses to sophisticated, high-tech IT enabled corporations which employ transcriptionist on well paid pay rolls. In the metros and major cities, many big business names have ventured into this field and are flourishing and expanding day in and day out. Most of the bigger companies prefer to have in-house training programs so as to cater with the demand and curb down the effects of growing attrition rate. Some medical transcription firms even get their work done by employing on-site as well as home-based medical transcription basis.

It is not a cake walk for Indian companies in this field to compete with the medical transcription professionals of the western nations who seem to enjoy all the advantages of language and backdoor environment. Every now and then there is an anti outsourcing voice raised for the work outsourced to India and trying to bring out faults in the work done here. At the same time, Indian industry is pitted against some new developing destinations like China, Philippines, Sri Lanka and others who are eager to fight out with Indian dominance. But still India enjoys an upper hand with its efficient work force and competency which augurs well with the high demanding western world. Ultimately, what matters most is the honest work, truthfulness, and diligence which would win against all odds!

 

Medical Transcription: Automation is Driving Growth in Speech Recognition

Friday, 27 June 2008, 06:02 CDT | redOrbit NewsHealthcare automation is driving growth in speech technology, with the leading vendors providing specialized solutions, according to a new report by Datamonitor. Although use of PC-based speech recognition is not widespread, the technology has found its niche in the healthcare market, where automation and cost savings are key drivers.

Tight budgets and the need for accurate patient records are forcing healthcare providers to automate processes with speech recognition. In order to reduce the error rate in diagnosis and ensure that information is recorded efficiently, healthcare providers are adopting electronic health records (EHRs).

By dictating notes directly into EHRs, using speech recognition with digital dictation systems, doctors can update information faster and with lower error rates. Patient information is gradually becoming digitized in order to deliver test results and records more quickly. By reducing the number of illegible handwritten documents and simplifying processes, providers can eradicate errors in diagnosis.

Speech recognition is also being used for medical transcription, easing pressure on transcriptionists and allowing healthcare providers to save on staffing costs. Medical transcription is estimated to be a multi-billion dollar market and speech recognition vendors are taking advantage of this.

Healthcare currently represents 85% of the PC- and server-based speech recognition market. Datamonitor estimates that the market for speech recognition in healthcare globally is worth an estimated $170m in 2008. Between 2008 and 2013 the market will more than double in size.

Imaging is one area in which speech recognition has seen a significant uptake, as an increasing number of radiologists use the technology to dictate reports. Radiologists work in controlled environments using specialized vocabularies to dictate reports that, as they often use repeated language, are an ideal target for speech recognition vendors.

Healthcare is not the only industry where speech recognition is thriving. Investments in speech technology are expected to grow in the professional services, where it can help with legal transcription. The technology is also likely to be increasingly used to assist with language learning in education. However, healthcare will remain the largest market for speech recognition through 2013.

The introduction of digital dictation and EHRs has given speech recognition new channels to market. Speech technology adoption will increase as it becomes more tightly integrated with these solutions to provide a seamless document production process.

Source: Datamonitor

 

Now doctors jump into BPO bandwagon

18 May, 2008, 1410 hrs IST, PTI
Source: The Economic Times

NEW DELHI: After engineers and lawyers, now doctors are also gearing up to join the BPO brigade, with the outsourcing firms opening up alternative career options for medicos.

With more and more outsourcing firms moving into healthcare sector and medical transcription, the job opportunities for doctors and nurses in the country are getting widened, an industry expert said.

In a BPO firm, the job of a doctor can include medical billing, transcription and coding for the US hospitals.

Medical transcription, also known as MT, is an allied health profession, which deals in the process of transcription, or converting voice-recorded reports as dictated by physicians and/or other healthcare professionals into text format.

However, some companies like the Patni also provides high-end knowkledge process outsourcing where a doctor is required to study the reports of elderly patients and do risk assessment and prepare reports for health Insurance companies in the US.

At present, the IT services and business outsourcing company has 10 doctors in its team who does insurance claim processing, claim and long-term care management.

Nishikant Kadam, Head of HR of medical BPO CBay said: “We generally hire doctors for training our workforce. The doctors in our firm also works as quality analyst for our medical transcription work.”

CBay currently has 11 doctors on its roll. The doctors are also enjoying this corporate job which comes with fat pay-packet.

“It takes at least three to four years for a fresh medical graduate to establish a successful medical practice. In this period a person can work in a medical BPO and earn good cash,” a doctor working with a Noida-based BPO said.

“Salaries are lucrative compared to regular medical job. A senior doctor with three-five years experience could earn about Rs 8-20 lakh per annum in KPO,” Patni Senior Vice- President Sanjiv Kapur told PTI.

As more medico-related work comes to India, the opportunity for more doctors in the business is rising.

The concept of the “greying of America” is widely accepted today. By 2020, the US population over the age of 65 is projected to grow to 55 million and 42 per cent of them would enter a nursing home in their lifetime. This has opened alternative career options for Doctors in KPO,” Kapur added.

“By outsourcing these jobs, the hospitals and clinics in the US aim to reduce your administrative burden,” Kadam said.

 

Are MTs Necessary?

This column explores the realm of the medical language specialist. This week, read about “Are MTs Necessary?”
By Rebecca A. McSwain, PhD, CMT, CPC-H-A

Experienced transcriptionists spot mistakes or inconsistencies in a medical report and check to correct the information. Their ability to understand and correctly transcribe patient assessments and treatments reduces the chance of patients receiving ineffective or even harmful treatments and ensures high-quality patient care. US Department of Labor, Bureau of Labor Statistics, www.bls.gov/oco/ocos271.htm

The above paragraph, at the US Department of Labor’s Bureau of Labor Statistics Web site, mentions an aspect of our job that seems underappreciated: quality assurance. Patient by patient, report by report, for every one of the millions of files that pass through our hands every day, the MT is closely scrutinizing the medical record for accuracy, our own and others’. Currently, there is no one else, and no machine, doing this job. Health care providers, though ultimately responsible for the content of records they create, do not have the time or inclination to control quality at this level of detail in their documents. Health care institutions can (and do) conduct random assessments of medical record quality in various ways. But it is literally impossible for such programs to scrutinize every narrative record. Fortunately, medical transcriptionists are doing it. Unfortunately, various systems that eliminate or drastically reduce the role of the MT are also getting rid of this quality assurance (QA) function, thus throwing a pretty important baby out with the bathwater.

Anyone who honestly assesses documents currently created by voice recognition systems, and those created through self-entry by health care personnel, must acknowledge that these documents today pose a major quality risk. It’s likely that in the future–and, by the way, after extensive feedback training provided to the machines by human MTs–VR systems will improve. But will it be enough?

As for self-entry: there may come a day when health care providers can evaluate, diagnose and treat patients while at the same time writing and keyboarding accurately and efficiently–with a mastery of spelling (even in areas outside their expertise) and grammar (even if English is their second language)–but I suspect that day is not now dawning. I think it may arrive about the same time that all health care providers are capable of doing their own coding accurately and efficiently.

And the medical transcriptionist brings something else to the creation of the medical narrative: a global understanding of language (medical and secular) and medical practice, combined with a comprehension of relevant community, provider, technology and individual patient circumstances for each of millions of encounters. This wide knowledge base, of course, grows bigger and better the longer an MT works in a particular context. But an experienced MT brings a store of information into any clinical situation, even an unfamiliar one. This specific kind of knowledge is not really held anywhere else in the health care system. Individual providers don’t have it–they have pieces of it, but not the whole picture. Electronic data bases don’t have it. I won’t assert that computers will never be capable of this level of value, but they are far from it now. And this MT knowledge is a source of quality in the medical narrative for which there is currently no substitute.

If this QA function is, in fact, important, then HIM managers, administrators, planners, need to consider how to preserve it, whatever the mode of record-creation may be in the future. If not MTs, then who?

Rebecca A. McSwain is currently working as a production MT for a national service. She has worked as an MT supervisor, business owner, instructor and QA manager. She’s a member of AHDI and the American Medical Writers Association. She has a PhD in anthropology and continues to work on anthro-related writing projects in her spare time. She can be reached at rmcswain_985@fuse.net.

Copyright ©2008 Merion Publications

 

Productivity council to provide medical transcription training

Staff Reporter

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Plans to conduct free seminar

50 candidates to be admitted

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TIRUCHI: Tiruchi Productivity Council (TPC) has decided to step into its 50th year of existence by offering a 180-hour training programme in medical transcription through a tie-up with U.S. based itrans Solutions that has an operational base in Coimbatore.

Based on a survey carried out to determine the nature of job that would suit bright graduates of arts and science colleges the most, the TPC decided upon Medical Transcription programme, the Council Hon. Secretary Raja Mutthirulandi told ‘The Hindu.’ The TPC will conduct a free seminar during the third week of this month.

The training would be offered for a maximum of 50 candidates in two batches at the TPC’s own premises in Woraiyur in the city. Candidates completing the training programme also have the option of working for itrans Solutions. The TPC will also admit candidates identified by the Tiruchi District Tiny and Small Scale Industries’ Association (TIDITSSIA) to groom them as entrepreneurs.

TIDITSSIA is keen on adding value to the entrepreneurship ventures in the Business Process Outsourcing segment, said the Association president S. Sridharan, who is also the president of TPC. For further information, contact TPC at the dial of 0431–2762320 or email tpcsecretary@gmail.com.

© Copyright 2000 – 2008. The Hindu

 

Philippines – English proficiency improved but BPO leaders warn against complacency

By JESUS F. LLANTO
abs-cbnNews.com/Newsbreak

Despite improvement in the self-assessed English language proficiency of the Filipinos, the Philippines should not remain complacent and should sustain its efforts to further improve its competence in the language to maintain its position as top destination for the business process outsourcing (BPO), experts said.

The results of the April 2008 survey of the Social Weather Stations on the self-assessed proficiency in the English language of the Filipinos showed a “substantial recovery” in understanding, reading, writing, speaking and thinking using the language compared to 2006.

The survey, which was commissioned by Promoting English Proficiency Project of the American Chamber of Commerce and the Makati Business Club, was conducted by interviewing 1,200 respondents and has a margin of error of +3%.Ramon del Rosario Jr., president of the MBC, said the improvement in self-assessed competence is a market-driven response to the rise of BPO industry.

“They realized that if they want to be employed, they really need to hone their skills and one of the skills needed by the market is English proficiency,” del Rosario said.

Don’t be complacent
Experts in the BPO industry, however, said that although the results of the survey sound positive, there is a need to sustain the measures that have been started to improve the Filipinos’ competence in the language since others countries are also trying to get a share of the global BPO market.

“It’s a step forward but we have a long way to go,” said Jamea Garcia, executive director for talent of the Business Process Association of the Philippines (BPAP).

Garcia added that other countries have been striving to improve the quality of their workforce by strengthening the English proficiency of their workers to become attractive BPO destinations. She said China, Vietnam and Latin American countries are fast becoming important destinations of outsourcing firms.

“We should not be complacent so we can still maintain our advantage,” Garcia told abs-cbnNEWS.com/Newsbreak.

The Philippines was named by the UK National Outsourcing Association as the outsourcing destination of the year for 2007. BPAP estimates that by 2010 the BPO outsourcing industry can generate US$13 billion revenues, or 10-percent share of the global market, and provide one million jobs.

As of 2007, around 300,000 people are working in the BPO sector. This means that the industry needs to augment its workforce by 600,000 in the next two years to meet the target for 2010.

Lack of qualified applicants
BPO firms, however, are having a hard time filling positions because of the low recruitment yield and lack of applicants who are fluent in English.

A November 2007 industry-wide survey by the BPAP and Outsource2Philippines.com showed that 46 percent of the companies surveyed found that only 6-20 percent of applicants qualified. Two-thirds (66 %) of the companies, the survey showed, had to provide new hires free remedial English training.

Other sectors in the BPO industry, like medical transcription, also experience low absorption rate due to lack of qualified applicants. Raymund Eruma, executive director of the Medical Transcription Industry Association of the Philippines, Inc (MTIAPI) said some transcription companies found only 2-3 out of 10 applicants qualified. “Most of them are having problems comprehending dictations.”

Garcia said in a previous interview that this scenario is one of the threats to the growth of BPO industry. “If we continue with what we are having this moment, we might not have enough workers to meet future demand.”

Language proficiency training
A number of programs have been designed by the government, the industry players and the academe to develop English proficiency of the students and the workers. Scholarships from the government and tie-ups between the industry and academe are among the measures taken to develop a pool of qualified workers for the BPO industry.

Oscar Sañez, CEO of BPAP, said these measures should be continued and strengthened as the demand for workers continues. He added that a large pool of qualified applicants can save the resources of a company.

“Recruitment and training [of new hires] cost a lot of money,” Sañez said adding that minimizing recruiting and training costs can add roughly 2-3 percent points in the company’s profitability.

Sañez said that the measures being undertaken today are just short-term solutions. He said that what is needed are reforms in the education, particularly changes in the curriculum. — With research by Fharhana Abdurahim.

 

Big Sentence for Medicare Fraudster

April 03, 2008 02:59 PM ET | Luke Mullins

Rita Campos Ramirez, a 60-year-old Miami resident, received a 10-year prison sentence for her role in a multimillion-dollar Medicare fraud scheme. The $170 million scheme is the program’s largest individual case of fraud ever. The sentence was announced Wednesday.

As part of her punishment, Ramirez will also have to hand over her three homes and a car. Plus, she was ordered to pay $105 million in restitution to the federal government.

“The sentence in this case dispels the myth that white-collar-crime defendants get off lightly,” FBI Special Agent in Charge Jonathan Solomon said in a press release. “It reinforces the message that healthcare fraud—stealing from U.S. taxpayers—is a serious crime.”

Details of the crime:

Campos pleaded guilty on Aug. 28, 2007, to one count of conspiracy to commit health care fraud and one count of submitting false claims to Medicare. As part of her plea, Campos admitted that between October 2002 and April 2006 she owned and operated R&I Medical Billing Inc., a medical billing company that specialized in submitting bills to the Medicare program on behalf of HIV infusion clinics. Campos admitted that she knowingly submitted approximately $170 million in fraudulent medical bills to Medicare on behalf of 75 HIV infusion clinics in Miami-Dade County that were part of the scheme. Infusion clinics serve HIV patients by providing prescribed medications intravenously.

The Medicare program paid approximately $105 million of the $170 million in fraudulent bills submitted by Campos, with Campos personally receiving $5 million for her role in the fraud.

Full press release is here.

 

Introduction

Hi Guys,

This is Karna from Chennai, India. I’ve been in the US Medical Billing Industry for some time now and thought of having an open channel of communication with people in the same industry. With this idea in mind, have created this blog titled Healthcare BPO to enable people from different parts of the world who are involved in a similar industry to share any news, views, articles, information, ideas, thoughts and knowledge related to the industry…

Hope to have all your support…

Thanks,
Karna (கர்ணா)