Rising costs, staffing shortages, and complex regulations are overwhelming the healthcare industry. Here’s how outsourcing is helping providers regain control and focus on care.
As a healthcare provider, you’re expected to deliver exceptional patient care while juggling a growing list of administrative challenges. From increasing claim denials and tightening regulations to outdated revenue systems and skilled labor shortages, providers are struggling to keep pace.
In a study by Kaufman Hall, a majority of healthcare organizations reported a spike in claim denials, up from just 33% the previous year.
2022 State Of Healthcare Performance Improvement,
Kaufman Hall
PYMNTS also found that most providers are losing revenue due to inefficient accounts receivable processes, with 85% agreeing their systems need major improvements.
Pains and Gains: Conquering Healthcare’s Payment Woes,
PYMNTS
Many healthcare companies remain vulnerable to revenue leakage due to outdated invoicing and manual payment processes. NetSuite reported that up to 15% of healthcare revenue is lost this way.
As a healthcare manager, these issues may sound familiar. Business process outsourcing (BPO) has emerged as a strategic solution to help address these challenges.
What is Healthcare BPO?
Healthcare BPO involves delegating non-core medical and administrative tasks to specialized external providers. Traditionally, outsourcing included services like housekeeping, utility maintenance, and inventory management. Today, it encompasses a wide range of high-value administrative functions, including:
Medical Billing and Coding – BPO teams manage patient data and apply standardized systems such as HCPCS (Healthcare Common Procedure Coding System) and the ICD (International Classification of Diseases) to medical procedures, ensuring faster, more accurate reimbursements and fewer rejected claims.
Claims Processing – BPO providers handle insurance setup, verify patient details, and manage claim submission and follow-up, streamlining the process and reducing errors.
Data Entry and Management – Specialists accurately input and maintain patient records, including lab results, prescriptions, and drug inventory, allowing clinical staff to focus on patient care.
Medical Transcription – Outsourced transcriptionists convert physician audio notes into accurate written records including diagnoses, clinical findings, and surgery notes.
Medical Cost Analysis – Analysts compile and evaluate medical records to estimate care costs and create reports such as Life Care Plans (LCP), Medical Cost Projections (MCP), and Medical Impact Reports (MIR). Proper cost analysis helps healthcare providers and legal teams understand the financial impact of medical care.
Nurse Analysis Report – Experienced nurses review and interpret records to assess standards of care and provide insight in legal cases, such as malpractice claims.
Medical Chronology – BPO staff organize medical events into a clear, chronological narrative focused on specific incidents like falls, motor vehicle accidents, or wound care.
Brief Preparation/Writing – Outsourcing teams collect relevant documents like physician CVs and insurance paperwork, then validate and summarize key data to create accurate and professional legal briefs.
Why Use Healthcare BPO?
As the healthcare industry evolves, BPO offers a flexible, scalable way to meet increasing operational demands, navigate compliance challenges, and stay competitive. Smaller providers often lack the internal resources to meet staffing or technology needs. Outsourcing fills those gaps efficiently.
Healthcare BPO firms employ professionals skilled in coding, claims processing, transcription and data management. Partnering with these experts gives providers access to advanced tools and specialized talent without the cost of building in-house teams.
Outsourcing Non-Core Services in Healthcare: A Cost-Benefit Analysis,
International Journal of Scientific Research and Management
The graph shows that despite upfront and ongoing costs, all services achieve net savings, with IT and catering seeing the largest reductions. According to the study, outsourcing can also improve service quality, efficiency, and resource use in healthcare. For example, outsourced IT leads to better uptime and faster issue resolution.
Strict regulations like HIPAA make compliance critical. BPO partners implement certified frameworks such as HIPAA and SOC 2 to protect sensitive data and ensure secure management of medical records.
By outsourcing administrative tasks, healthcare professionals can focus more on patient care. Patients benefit from shorter wait times, better clinical attention, streamlined scheduling, and expanded telehealth services.
20th Annual Outsourcing Services Survey,
Black Book Research
BPO is especially valuable during staffing shortages, technology upgrades, regulatory audits, and spikes in patient volume. It allows healthcare organizations to scale efficiently while maintaining high-quality service. Healthcare BPO is not just a cost-saving measure, it’s a strategic advantage that supports sustainable growth and improved patient outcomes in a fast-changing industry.
Review the key benefits of healthcare BPO:
– Ensures regulatory compliance and minimizes risk
– Reduces operational costs and redirects resources to patient care
– Provides access to skilled professionals and advanced technologies
– Improves accuracy in coding, billing, and data entry