Administrators in the healthcare industry are facing increasing pressure to reign in operating costs and improve overall operational efficiency. This is driving clinics to more frequently consider and aggressively deploy alternative models (such as business process outsourcing (BPO) to deliver operational services. The use of alternative service delivery models is growing for back-office operations as well as for core healthcare business functions and processes. Although some consider this goal unattainable, the reality of the market is that administrators must consider how best to address the challenges.
According to one study by expert outsourcing advisory firm EquaTerra, “One option healthcare organizations have at their disposal is to fundamentally overhaul the means through which they consume and deliver their core service offerings. The services addressed … such as IT, finance and accounting, human resources and procurement as well as customer and business partner-facing services such as customer care/call center, claims administration, policy maintenance, and enrollment.
EquaTerra estimates that – globally – 75 ITO and BPO healthcare deals with total contract values greater than $50 million were signed from 2004 through 2007. Approximately one-quarter of these were BPO deals. This represents less than 5 percent of the total deals in the market, highlighting the relative immaturity of the healthcare outsourcing market compared to other industries, such as banking, financial services, and manufacturing.
The healthcare industry faces unique outsourcing challenges, however, because of application and system integration challenges exacerbated by the highly regulated nature of the market. First, firms typically have older systems and applications in place. Second, there is overstaffing in back-office functions. Third, the industry has gone through a change, and many of the firms have not adapted to the evolving business climate. Fourth, healthcare buyers are facing more financial challenges and need to continue to innovate and transform. Outsourcing is a catalyst for changing behavior and reducing “the fat“.
The top 5 drivers in outsourcing in the healthcare industry are:
The top 5 key capabilities required to compete are:
As the scope of outsourced functions continues to expand, Adjuvant anticipates market growth in the outsourced call schedule/physician scheduling arena could grow much faster than expected.
The top 5 reasons for this are:
The healthcare industry in the United States is under extreme pressure to reduce costs while also expanding services and maintaining high service levels. Addressing inefficiencies in delivering both back-office as well as core operational services can play a key role in addressing these challenges. While the healthcare industry has historically lagged in other industries in its uptake of alternative service delivery models, this has begun to change.
Some of the tasks in the clinic that you thought could never be outsourced, like call scheduling, can be, and very well might have an impact in your clinic depending on who and how it is done today. Keep an open mind.
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Tags: Outsourced Scheduling