Medical billing outsourcing involves delegating the process of medical billing and related administrative tasks to third-party service providers. Instead of handling billing functions in-house, healthcare providers contract external companies or specialized agencies to manage tasks such as claim submissions, payment posting, coding, and revenue cycle management.
A recently released study concludes that the healthcare revenue cycle management industry will experience continued growth over the next decade. Specifically, the study finds that the industry, representing approximately $12.5 billion in revenue annually, is expected to experience a 12% Compound Annual Growth Rate (CAGR).
The research indicates that three primary factors drive this growth and stability: rising healthcare costs, the complication of private billing and coding, and the expanding need for billing and coding. Legal and compliance mandates are adding ever-increasing complexity and further the demand for outsourcing, as market participants seek to avoid exposure to bad press and punitive state action for non-compliance.
Finally, the report concludes that efforts by physicians to appropriately manage their revenue cycle often cause the adoption of outsourcing as the industry advances with new coding and billing programs. Further, the increased use of healthcare information systems and electronic health records has accelerated the transition toward outsourced medical billing as a means to bring down costs.
Healthcare providers make a strategic decision to outsource medical billing, aiming to improve efficiency, reduce costs, and ensure accurate and timely processing of healthcare-related financial transactions. It allows healthcare professionals to focus more on patient care while entrusting billing responsibilities to experts well-versed in the complexities of healthcare reimbursement and billing practices.
In spite of the promising projections of growth, many physicians hold serious concerns regarding the potential leakage of patient data. Companies seeking to broaden the acceptance of their outsourcing services will need to address these concerns limiting the adoption of medical billing outsourcing.