Healthcare BPO Market

Current Scenario

The healthcare landscape is going through a phase of rapid shift. From the lasting impact of the pandemic to developments in technology, the market is transforming at a breath-taking pace. Today, outsourcing has turned into a tactical need for healthcare companies striving to resolve labour shortages, reduce the effect of regulatory changes, willingly accept technological breakthroughs, mitigate costs and improve productivity. All these are fuelling the growth of this market. Apart from these, machine learning and AI are changing BPO with intelligent systems and automation. These AI and ML algorithms are bringing it within reach to create smart systems according to the company’s data. Also, Outsourcing or external partners are deploying AI tools for the development of conversational chatbots or virtual agents for customer care and other services, making forecasts on the basis of financial information, and exploring prospects for automation in the organization.

Drivers

The need for specialisation and niche services is driving the growth of the Healthcare BPO market. Considering the evolving consumer preferences and demands, specialised BPO services have taken center stage. This is because these particular providers customise their services and offerings to satisfy the requirements instead of serving generic solutions. They infuse money in market-specific technology and concepts or notions assisting businesses in manners which is feasible first time ever. Prominent companies in this market give niche services personalised to certain medical fields, like cardiology, oncology, and radiology. Another factor propelling the market growth is data security and compliance, which has emerged as the topmost priority for market players.

Restraints

One of the key restraining factors to the growth of the healthcare BPO market is patient privacy and data security. Since medical data is tightly regulated and sensitive, it is important to set up strong security defences and compliant procedures when outsourcing operations such as data management and medical billing. As per several recent studies, a major fraction of BPO companies, especially those managing healthcare data, suffer patient data theft attacks, and reports show that between 60 per cent to 80 per cent of these service providers have faced cyberattacks.

Besides this, another challenge hindering the expansion of the market is ensuring effective communication and partnership between the healthcare company and the BPO provider.

Segment Analysis

By Provider Service

• Medical Billing
• Medical Coding
• Medical Transcription
• Finance & Accounts

The medical billing segment is the most common outsourced category of the healthcare BPO market and is believed to move forward during the forecast period. Contracting out these services has emerged as a crucial strategy for healthcare organizations striving to optimise work, decrease costs, and enhance revenue cycle management. Moreover, the intricacy of medical billing, along with the constantly changing regulations in the healthcare landscape, positions outsourcing as a viable option which ultimately boosts the market share of this segment. In addition, cost reduction arises as a key propellent for the adoption of outsourced medical billing services. Healthcare providers, particularly smaller and mid-sized practices, are under substantial financial strain.

By Payer Service

• Claims Management
• Integrated Front-end Services and Back-office Operations
• Member Management
• Provider Management
• Billing and Accounts Management
• Analytics and Fraud Management
• H.R. Services

The claims management segment is the leading category of the healthcare BPO market, accounting for a substantial share. This can be attributed to the growing adoption of e-health services among patients. Also, the increasing rates of chronic illnesses are contributing to the expansion of the segment’s market size. Furthermore, technological advancements escalate the demand for claims management. The incorporation of technology, comprising electronic health records (EHR) systems and data analytics, has changed how claims are processed. The rising implementation of cloud-based solutions allows for more efficient data handling and improved accessibility for stakeholders involved in this process.

By Pharmaceutical Service

• Research and Development
• Manufacturing
• Non-clinical Services
  • Sales and Marketing services
  • Supply Chain Management
  • Other Non-Clinical Applications

The non-clinical services segment is anticipated to capture a larger share of the healthcare BPO market throughout the estimation period. The market trend of contracting out these services is fuelled by a mix of factors targeted at improving productivity, decreasing costs, and improving the quality of patient care. Also, by focusing on core competencies, and at the same time capitalizing on particular expertise from outsourcing partners, healthcare companies can guide the difficulties of modern healthcare delivery more effectively.

Regional Analysis

North America commands the healthcare BPO market and is expected to maintain its dominance over the forecast period. Particularly the United States is a prominent player at both regional as well as global levels. This dominance can be attributed to the necessity to adhere to regulations like HIPAA propels the demand for specialised BPO services. Cost management is another key reason behind the expansion of the segment’s market size. Furthermore, frequently contracted-out services comprise medical billing, revenue cycle management (RCM), and claims management.

Recent Market Developments

• In May 2024, KKR, a global investment firm, press released the purchase of a “significant minority stake” in an artificial intelligence-powered healthcare BPO organization called Infinx Healthcare for 150 million dollars (about INR 1250 crore).