The Rise of the Healthcare BPO: Outsourcing Medical Coding and Claim Processing

Updated on :October 18, 2023

COVID-19 has forced healthcare facilities to create a highly networked environment where all clinical operations are linked internally and coordinated with the other healthcare units. Using BPO firms to handle non-core tasks like patient interaction, claims management, and revenue cycle management allows healthcare providers to create a well-coordinated environment.

Healthcare providers have the opportunity to make a significant, long-lasting impact by providing an excellent client experience. Healthcare service providers may provide clients with peace of mind and memorable experiences that foster customer loyalty, customer and agent pleasure, and a favorable brand perception by comprehending the customer journey, anticipating the communication process, and utilizing innovative technologies.

This research study by GoodFirms titled 'The Rise of the Healthcare BPO: Outsourcing Medical coding and Claim processing’ examines outsourcing process services in the healthcare context. The research analyzes all the benefits of outsourcing healthcare BPO services, industry competition, evolving concepts, key challenges, regulations, and technological innovations in the healthcare BPO industry.


Healthcare Business Process Outsourcing (BPO) is a business activity in which a healthcare institution subcontracts out the management of its auxiliary operations to an outside provider. Healthcare organizations use independent contractors to complete the work or other service providers specializing in healthcare outsourcing. 

BPO healthcare companies excel at handling non-medical work such as computer and information technology-related tasks, accountancy, etc. Most firms in this industry choose to outsource their non-core functions to provide effective and efficient healthcare services to patients. Healthcare organizations can devote all their time and resources to patient care and increase workflow efficiency when they outsource non-core activities.  The human resources, revenue cycles, claims, supply chain, team member training, finance and accounting, and IT functions of healthcare facilities can be managed by BPO firms and other outsourcing firms.

This research by GoodFirms titled: 'The Rise of the Healthcare BPO: Outsourcing Medical coding and Claim processing’ explores the reasons behind the growing popularity of healthcare BPO companies after the COVID-19 pandemic breakout. The study also elaborates on the services BPO firms provide to the healthcare industry, the key driving factors for adopting outsourcing services from professionals, and the key players in the healthcare BPO market.

Services that Healthcare BPOs Perform

Services that healthcare BPOs perform

Medical coding and billing services

Every day, hospitals and medical professionals must deal with medical information requiring intricate classification and billing. Healthcare providers may encounter serious mistakes and processing delays while processing patient information and bills without the necessary training and experience. Outsourcing medical billing to healthcare BPO ensures no billing or coding issues.

Healthcare BPO professionals have the appropriate education and training to carry out their duties accurately and efficiently. As a result, healthcare facilities can concentrate on their core competencies, such as better patient care, treatment, and research.

Data collection and entry services

Every day, healthcare companies interact with several patients and deal with several customer data points. Organizations need a fluid chain of processes to collect these data (insurance information, prescriptions written by doctors, historical health records, and patient health information) and save them in the proper formats. 

This bulk data can be accurately entered by healthcare BPO specialists, freeing the internal staff to work on more difficult decision-making responsibilities. BPO companies help healthcare organizations maintain good patient services through scheduling solutions.

Medical claims processing services

Processing patient insurance claims is another non-core healthcare task that is frequently outsourced. Patients' insurance companies' legitimate medical claims must be efficiently managed. Maintaining accuracy and timeliness can be difficult when several claims must be processed daily.

The demand for claims processing services, driven mainly by doctors' offices and other healthcare providers, will continue to rise. The number of medical visits will rise even more. As a result, there will be an increase in the number of patient insurance claims in the coming years.(1)

Medical transcription services

Transcribing one's notes is a task that takes healthcare professionals a lot of time and effort. Patients must be taken care of carefully by surgeons, doctors, general practitioners, nurses, and other medical personnel. However, many of them are slowed down by administrative duties and other paperwork, which limits their time with patients and causes medical burnout.

It's more complicated than it seems to transcribe medical records. Even though it may appear easy to convert audio files into text forms, if someone is unfamiliar with medical jargon, it may be challenging to understand what the doctor stated. It is better to outsource this task to experienced medical transcriptionists because it can be highly time-consuming and intensive.

Other Services

Revenue Cycle Management (RCM) Services: The hospital's or medical practice's effectiveness is significantly impacted by RCM. Daily operations have become time-consuming for healthcare operators due to the rising expense of RCM advice and the rules and regulations that keep changing frequently. Hospitals can profit from higher client happiness, better claim filing, and better returns by outsourcing their healthcare and utilizing specialized revenue cycle analytics services.

Medical Accounts Receivable: To collect unpaid/underpaid claims, healthcare institutions might use the assistance of healthcare BPO businesses to identify patient accounts that need to be followed up on. They offer a variety of hospital revenue cycle outsourcing solutions, which can aid in improving operational effectiveness. Additionally, they can create regular reports that can be used to manage cash flow better and boost profitability.

Chart Prepping Services: By outsourcing chart preparation services, healthcare organizations can eliminate the time-consuming task of physician data input and more effectively manage the time and schedule of the doctors, allowing them to spend more time treating patients.

Payment Posting: Rejected claims, patient late payments, or not billing a patient at all might eventually result in significant losses for a medical business. Outsourcing the payment posting procedure impacts a variety of other office operations and can significantly affect patient happiness, productivity, and overall financial performance.

Medical Animation and Illustration: Medical animation services can be outsourced for various purposes, including instructing medical professionals and students, teaching patients, outlining various treatment options, and promoting surgical equipment.

Pharmacy Management: Healthcare BPO Companies try to combine people skills and experience with the latest technology to provide the best pharmacy services. In addition to comprehending and dominating the pharmacy sector that hospitals dominate, they also work to control expenses while upholding the most excellent quality standards.

They streamline and make the processes user-friendly, guaranteeing that they create an extremely professional internal and external environment.

Appointment management/Doctor appointment: To achieve excellent patient experience management, Healthcare BPO companies provide patients with timely and practical physician appointment scheduling services. Patient appointment management systems will also manage physician calendars to guarantee effective management of available appointment times for maximum efficiency.

Patients Survey: Healthcare BPO service providers have a pre-established data framework of the post-care patients to which they can survey and gather information. It enables them to collect useful feedback through patient surveys and enhance healthcare customer services for better outcomes.

Inbound & Outbound Call Center: Healthcare organizations can reduce their staff costs by outsourcing the call center work because they have call center executives who are highly qualified and trained to handle all types of calls from patients. It is expensive to hire and train staff internally on call center procedures. Outsourcing the call center process can guarantee quality staff at lower rates.

Patient Scheduling: Outsourcing patient appointment scheduling to a healthcare outsourcing company is an efficient approach to handling non-core duties. A team of professionals will work with healthcare organizations to plan appointments and handle appointment confirmation and rescheduling. Importantly, specialists will manage this administrative duty, freeing staff to focus on the core tasks.

Patient Care Service: Patients want quick scheduling and managing appointments online, receive care electronically through telehealth, and other technology-driven healthcare services which can be provided through an outsourcing company.

Patient Intake: The impact of cancellations can be reduced by maintaining an active patient intake list. As the day goes on, open slots can be used to fill any necessary same-day appointments. Patients who want an earlier appointment can arrange one by receiving notifications when such slots become available.

Vendors Coordination: Outsourcing vendor management services gives healthcare organizations support for vendor administrative management, allowing them to rest easy knowing that the many suppliers and vendors they use are managed consistently, effectively, and efficiently by the BPO company.

Partners coordination: Healthcare BPO companies operate and conduct activities per the healthcare partners' requirements and decisions, such as social care and health promotions on behalf of medical facilities.

Chat, Phone, and Message services: With the help of the BPO system, patients can call, email, or text doctors' appointments whenever convenient, using live web chat forums and instant messaging software.

Key Benefits of Outsourcing Healthcare BPO Services

benefts of healthcare bpo

Cost Reduction

One of the key considerations for outsourcing healthcare services is cost-cutting. By lowering overhead expenditures and charges, healthcare business outsourcing is crucial to attaining the goals and objectives of various healthcare establishments. Outsourcing a few healthcare activities results in financial savings by lowering operational costs associated with hiring and training the internal workforce. Maintaining an in-house staff requires more attention than can be devoted to essential business operations.

Better Customer Experience

47% of customers believe that the healthcare and life sciences industries are more concerned with meeting the industry's requirements than the patients.(2)

For long-term success, every organization must concentrate on sales and marketing efforts. Outsourcing gives healthcare organizations staff more clearly prioritized tasks, allowing them to concentrate on providing excellent customer service. Healthcare outsourcing is mainly done to eliminate all extraneous distractions and focus on core expertise. This can be helpful because it will lighten the administrative and managerial staff's load, allowing them to concentrate on providing the best possible healthcare to patients.

Access to Skilled Expertise

One of the key benefits of outsourcing healthcare services is the availability of qualified and trained people who are experts in carrying out specific activities and are always prepared to complete complex jobs efficiently at terse notice. Medical outsourcing businesses ensure that clients' needs are met on time, in the best way possible, and without any inconvenience. Additionally, it relieves job pressure by reducing the amount of paperwork and employee labor required.

Professionals in the healthcare BPO industry have access to the most recent technologies, facilitating and improving collaboration. Additionally, qualified BPO service providers have good experience in this sector. They may offer the support and direction required to ensure that all services are rendered correctly.

Focus on Core Tasks

Healthcare organizations can focus on what they do best by outsourcing their non-core activities to professionals, which helps them eliminate outside distractions. This improves healthcare standards across the board for the business and is essential to boosting its reputation.

Data Storage and Security

Digital data is more secure than physical paper. It is crucial to save data so that it may be quickly recovered if lost. Healthcare professionals may find it challenging to keep the data in a secure location. These tasks are outsourced to healthcare BPO companies, resulting in secure storage across multiple sites and an extra layer of protection against data breaches.

Data security is an essential factor in any industry. However, data security is crucial in the healthcare industry because it can include patient records, invoices, prescriptions, inventory records, and much more. These can be safely kept on the cloud, but security precautions must be taken, as they cannot be recovered if lost.

Time Management

Collaborating with healthcare BPO providers, healthcare organizations may avoid wasting time on repetitive work. Healthcare professionals can save time by delegating time-consuming and non-core tasks to the outsourcing company. This is why most healthcare organizations have contracted administrative tasks like data input, processing, and billing to reputable corporations in their industry.

Increased Workflow Efficiency

Working with outsourcing firms gives healthcare institutions access to technology, such as automation software, that can help them increase the productivity and efficiency of their workflow. Additionally, outsourcing enables medical facilities to concentrate on their core competencies while receiving top-notch outcomes from the contracted tasks.

Improved Patient Care

By outsourcing administrative and unnecessary duties to BPO companies, the patient experience at the specific healthcare facility would be considerably improved. The hospital can concentrate on treating their patients and providing them with quality patient care.

Better Patient Enrolment/Scheduling 

An effective way to handle patient enrollment/scheduling is to outsource patient appointment scheduling to a medical billing service provider. The experts will arrange meetings and handle appointment confirmation and rescheduling on behalf of the healthcare organization. Healthcare BPOs can guarantee a well-organized appointment scheduling procedure that will increase patient trust, increase office productivity, and positively affect the revenue cycle.

Better Strategic Planning

Outsourcing all the administrative and non-core tasks to an outsourcing company helps the healthcare organization's managers, doctors, and staff to work in organized and planned procedures that clarify their work purpose, resulting in improved health performance in the organization.

Increased Revenue

Another advantage of outsourcing to healthcare organizations is that they can save the cost that would have been spent on local resources. Access to low-cost labor and infrastructure through outsourcing is one of the primary factors that provide significant savings and aid healthcare organizations, hospitals, and clinics in boosting their profit margins.

Turnkey Call Center

Call centers' response and resolution times can be significantly enhanced by outsourcing. Outsourcing a call center reduces call hold times and can assist with appointment scheduling and administration, FAQs, payment assistance, and other medical and claiming queries.

Improved Healthcare IT

Healthcare organizations require a wide range of IT facilities, from keeping electronic records and safeguarding patient safety to managing food and nutrition services effectively. The following are a few advantages of outsourcing IT in healthcare:

  • Scalable systems that can change to meet the needs of the institution.
  • Increased data security for patients.
  • Quick access to professionals with extensive training.
  • Reduced expenses for the upkeep of data centers and EHR servers.

Healthcare CRM

Healthcare CRM assists healthcare providers in maintaining their operations by enhancing care quality, reducing expenses, and effectively utilizing patient information. The management of relationships among patients, doctors, hospitals, laboratories, pharmacies, reminders for doctor visits, missed medicine notifications, health suggestions, patient education, event reminders for health camps, wellness talks, etc., can be operated by a CRM platform. 

Factors Contributing to the Rise of Healthcare BPO

According to a survey, the desire to increase customer satisfaction and cost savings are the elements that hospitals and clinics consider when considering outsourcing.(3)

With the increase in the number of hospital admissions worldwide, there is also a huge demand for efficient healthcare services. Embedding digitalization in healthcare operations drives superior outcomes, value realization, and streamlined operations. Such initiation helps healthcare companies sustain and work efficiently in the future. Intelligent automation enables productivity gains and transactional accuracy. It also contributes to cost savings. Healthcare business process outsourcing (BPO) companies offer such facilities to healthcare operators. The market is growing and is likely to grow further in the coming years.

Minimize Errors: Healthcare organizations can suffer financial losses and reputational damage if errors are frequent. Most healthcare organizations fall behind other data management and billing rules, leading to incorrect billing and fines. Staying updated requires time and effort, which can be achieved by outsourcing. A team of professionals with expertise in this field can complete these tasks perfectly and reduce the scope of committing errors.

Low Operating Cost: Healthcare organizations do not need to spend extra money on software installation or training for unrelated tasks because a professional service provider takes care of all those things. Additionally, the staff of outsourcing firms is ready to handle all menial duties and has access to the most recent equipment and technology to complete tasks. A team of experts can help lower operating costs by reducing the need for infrastructure and training.

Delegation of Non-Core Work: The main advantage of working with an outsourcing firm is that it allows healthcare organizations to delegate non-core tasks and concentrate solely on their core business operations. In the healthcare industry, their main priority is to enhance the quality of care to patients, which not only enhances the reputation of their firm but also encourages patients to return whenever they experience a health issue, ultimately increasing the trust factor.

Provide Valuable Data Insights: When healthcare organizations outsource data management services, they get data regarding the areas to be upgraded and need rectification. With these data insights, healthcare practitioners can determine what routine and administrative modifications are required.

Additionally, the information provides a detailed picture of the patient's medical background so that the healthcare provider can choose which region needs extra care and attention. The data overview will also make recommendations regarding which processes should be abandoned and which need more attention and care.

Outsourcing Companies Reduce the Chances of Delays: Medical claims must be paid promptly for healthcare facilities to function efficiently, but if payments are delayed, the medical billing team will have an increased burden due to denied claims, which will put additional strain on them. Payment delays are most frequently caused by denied claims, which several things can cause, including overworked employees, which can lead to a high rate of billing or coding errors, or having to train new doctors or staff regularly. Outsourcing these tasks to healthcare BPO companies reduces the chances of delayed claim processing and faster payments.

BPO Firms Consist of Qualified Staff: The accessibility to more substantial talent resources is another benefit of outsourcing. Healthcare organizations can only access a small percentage of skilled workers by hiring locally. Outsourcing allows them to access more qualified and experienced people worldwide. 

Faster Services and Exceptional Patient Experiences: Patients are more interested in quick delivery and high-quality services. A BPO company consistently provides exceptional patient care and supports high patient loyalty and retention. 

Challenges that Healthcare BPO Companies Face 

Patient Data Security and Privacy

The healthcare sector is very concerned about information security. Data may be compromised while it is transferred between repositories. Because of this, data security is now a significant concern. Data security is deploying robust hardware and software solutions to secure data and ensure it is correct and trustworthy. Only gathering the necessary information, protecting the saved data, and erasing any information that is no longer necessary are all components of an efficient data security plan. BPO Organizations must acknowledge the new and developing global privacy and security requirements due to the rise in cyberattacks, data breaches, and invasions of personal data.

Staying Up-To-Date with Technological Advancements

The dynamics of hardware and software are evolving in the contemporary technological environment. Hospital software programs like the patient administration system, appointment management system and laboratory information management system are now being powered by the latest technologies like AI and machine learning. For patient screening and monitoring during the coronavirus pandemic, many healthcare organizations used AI.(4)

In an Interview given to Outsourcing Center, a Healthcare BPO and consulting company,  Dr. Harry Greenspun, the Chief Medical Officer for Dell Perot Systems, says- "Buyers must support an outsourcing partner with good healthcare experience because the risks from technology errors are considerable and potentially life-threatening."(5)

Healthcare BPO companies must establish better links with medical manufacturers and software development firms to fully realize the potential of healthcare technology to alter healthcare systems and create a connected healthcare environment. They can exchange knowledge and create new business plans and scenarios to help the healthcare industry implement new technology more successfully.

Ensuring Quality of Work

Healthcare BPos can monitor cash flow and revenue growth using post and record payments. The billing and collection procedure won't be interrupted once the claim is authorized. Thus, removing inaccuracies from the claims can be crucial. Making a log of the receipts given to the medical billing team is the only way to confirm that the account balances are correct. To ensure intentional payment posting with confirmation, every pertinent piece of information and every relevant detail must be included in the log supplied to the billing team.

Medical errors that directly impact patients' safety and well-being can be caused by incorrect data, incompleteness, invalidity, inaccuracy, duplication, and non-standardization. These errors can also harm the reputation of healthcare providers and result in expensive legal actions. Additionally, poor data quality can result in incorrect reimbursements, postponed treatments, and ineffective internal and external communication. By giving inaccurate information, incorrect data can potentially impede medical research and development efforts.

Constant Rise in Healthcare Prices

The most significant issues facing BPO firms are rising healthcare expenses and data privacy. The cost of healthcare services is influenced by payers, makers of medical devices and drugs, and providers of insurance policies. Attending emergencies may be delayed by a lack of resources that can promptly gather and analyze the results. Conflict is inevitable when there are so many interested parties.

According to Carnegie Mellon University economics expert Martin Gaynor, healthcare spending is exorbitant and ultimately unsustainable.(6)

The rising cost of healthcare directly influences healthcare organizations' revenue because patients are deterred from completing routine follow-ups after visits and taking lab tests due to higher costs, which eventually results in poor patient outcomes.

Healthcare BPO Market: Key players

stat healthcare bpo

The healthcare BPO market's competitive environment includes information on the business overview, financials, products, and robust business strategies. There are several significant participants in the competitive healthcare BPO market. Few big competitors now control most of the market in terms of market share. A few other smaller firms are also being helped to enter the market with a sizable proportion thanks to the growing demand for mobile health and improvements in healthcare infrastructure. Accenture, Global Growth, GeBBS Healthcare Solutions, Genpact, International Business Machines Corporation (IBM), Parexel International Corporation, IQVIA, and Sutherland Global Services are a few of the market's top companies, along with others like UnitedHealth Group and Cognizant Technology Solutions.(7)

Accenture is a market pioneer in offering affordable healthcare services. It provides administrative and medical services in more than 45 nations, including the US, India, and the Philippines.

Major services offered:

  • Account and billing services for healthcare.
  • Filing of claims.
  • Medicare benefits
  • Pharmacy benefits administration.
  • Analytics for improving cash flow.

Cognizant is a US multinational firm that offers quality outsourcing solutions and healthcare BPO services.

BPO services offered:

  • Health analytics and intelligence.
  • Integration of clinical services and data.
  • Cyclical management of revenue.
  • Systems for managing patient care.
  • Assistance desk services.

Invensis provides international services for healthcare BPO and patient support and has more than 16 years of experience. The business has ISO 9001 and 27001 certifications and complies with HIPAA.

Vital healthcare BPO services:

  • Healthcare billing and coding.
  • Filing of claims.
  • Data entry services.
  • Cycle management for revenue (RCM).
  • Services for charge entry and payment posting.

WNS offers a variety of healthcare services to meet the requirements of businesses all around the world. They also give technological solutions to expand the market shares of healthcare providers.

Important Healthcare BPO Services

  • Transcribing medical records.
  • Medical charge preparation and coding.
  • Services for payers and follow-ups.
  • The supply chain for medical equipment.
  • Care management for patients.

To remain competitive in the market, healthcare BPO companies have adopted many strategies, such as mergers and acquisitions, partnerships, collaborations, funding, and the development of new products, which have significantly contributed to the industry's growth. However, data security and confidentiality issues are the main factors impeding the growth of the healthcare BPO market.

Key Findings

  • Outsourcing a few of the  healthcare services results in financial savings by lowering operational costs associated with hiring and training the internal workforce and managing the infrastructure
  • Healthcare outsourcing is mainly done to eliminate all extraneous distractions and focus on core expertise.
  • One of the key benefits of outsourcing healthcare services is the availability of qualified and trained people who are experts in carrying out particular activities and always prepared to complete complex jobs at short notice.
  • Medical outsourcing businesses ensure that clients' needs are met on time, in the best way possible, and without any inconvenience.
  • Outsourcing medical billing to healthcare BPO ensures minimal billing or coding issues.
  • BPO Organizations must acknowledge the new and developing global privacy and security requirements due to the rise in cyberattacks, data breaches, and invasions of personal data.
  • Data security and confidentiality issues are the main factors impeding the growth of the healthcare BPO market.


The healthcare sector is going through multiple transitions currently. Every healthcare organization is seeking methods to reduce costs without compromising service quality. One of the most remarkable ways to tackle this issue is to use the healthcare data management outsourcing facility.

list of 900 medical billing outsourcing companies

Most healthcare organizations prioritize contracting out their medical transcription and healthcare data entry work, increasing productivity and efficiency. However, due to rising customer demands for high-quality services, businesses have begun outsourcing data management tasks, including data linked to clinical research, management systems, patients' histories, health outcomes, diagnosis, and more.



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