by: Sarah Joson
Monday, May 19, 2014 |
The Global Outsourcing Index 1Q14 released by the Information Services Group (ISG) indicated that a lot have been happening in the US healthcare market. The highlights of the report are discussed in an article posted at ISG-One.com where it was pointed out that the drastic changes in the US healthcare business model could be financially rewarding for both the private and public healthcare outsourcing players.
In a span of 10 years, the annual contract value of healthcare and pharmaceutical operations around the world has grown twice over. ISG also found that even with its slow growth rate, the US market is a major contributor to the worldwide healthcare ACV. The centralized market in the US grew 65 percent somewhere during the periods of 2008-2010 and 2011-2013 - almost equivalent to the growth of the commercial segment.
With the Affordable Care Act signed into law, challenges and advantages are expected to multiply faster in the commercial sector. This is where service providers take center stage and offer solutions that add value to industry participants.
The Affordable Care Act made way for a new business model. Before, it was purely a business-to-business environment, and then it evolved into a business-to-consumer market where individuals are mandated to purchase insurance personally. The new changes are said to fuel spend in the segment, and ISG anticipates that the services industry will soon reap the benefits of these changes. First off, new platforms should be integrated to be able to adapt to the changes. Then, with the new strategies, budget should also be moved to better suit the plans for the new processes.
The changes will also result to multitudes of patient information, from the easiest forms of data coming from healthy individuals, to the most complicated sets of information coming from patients with chronic diseases. Health information management service providers can step in and manage the large volume of data that healthcare institutions have to go through in order to bill an individual correctly.
Back then, healthcare providers were receiving payments for the same health condition and incident one at a time, but now, they would have to dissect a single payment so they would be able to itemize which part of the payment goes to which type of service. Accountable care organizations are now being considered by healthcare providers to move things along, reduce the risk of making mistakes in information and computation, and to ensure that individuals are getting the healthcare service they deserve.
ISG noted that processing efficiency and effectiveness is a window of opportunity for service providers. It is estimated to be worth $8 billion and is believed that healthcare organizations will look into managed services instead of increasing their staff and operations locally. In fact, during the 1Q2014, ISG has helped healthcare organizations address the 30 percent increase in workload by shifting US$120 million usually allotted for staff augmentation- to managed services.