The growth of the BPO industry has been apparent since the last decade. Plenty of big-name enterprises moved towards assigning a major portion of their work to outsourcing agencies based in developing countries, giving their economy a push.

Technological innovation, economic growth and international competition has enabled huge establishments to be able to afford BPO industries. From generating a mere revenue of $7 billion in 2006, to a revenue of approximately $120 billion today, the future looks promising for the BPO industry.

Although, it is estimated that 9 out of 10 industries rely on BPOs, for now let’s focus on how the medical enterprises employ outsourcing agencies.

Similar to other industries, the medical sector is also rapidly innovating and growing, which is why over the last two decades BPOs have gained prominence in the respective industry as well. The industry is estimated to show a massive development in the year 2023, gaining a transcendent growth.

BPO services in the healthcare sector reduces cost of staff acquisition and training, enrich patient care and boost competence. The services provided by MBPOs are given below:

  1. Revenue collection
  2. Medical data entry
  3. Medical data indexing
  4. Medical claims processing
  5. After-hour answering services
  6. Appointment reminders/scheduling
  7. Customer service
  8. Accounting and financial services

It can be argued that the hallmark of a MBPO is its ability to eradicate errors that could delay or reject payments. BPO owners claim to expedite your medical billing processes by a tenfold through their high accuracy rates in all the tasks associated with the completion of a payment. Many healthcare professionals have been declined payments on the grounds of incorrect information in documents, which has led them to rely on BPOs for the completion of their payments. Other attributes such as increase in revenue, demand for personalized services and increase in recovery audits are the driving forces for BPOs in the market. Although, there is a significant presence of factors that fuel the growth of BPOs in the market, uncertainty pertaining to the quality of the service is anticipated to deteriorate the market growth. In fact, the nature of the quality is the major factor that affects the sustainability of a BPO. For example, in late 2015, British Telecom terminated the operations of its call centers in India due to complaints regarding quality.

If we shed light on the upcoming trends in the healthcare industry, we find out that growth of the healthcare industry is also giving rise to the IT service industry due to the adoption of thriving new technologies. Perhaps, the biggest upside of adopting BPOs is that they are cost and time effective.

There are a few establishments which currently have an oligopoly in the healthcare BPO sector. For example, IBM takes up a major portion of the market and is currently the biggest player. Anyone operating in the IT field can’t be unknown to the works of IBM. It is an enterprise based in the US which is known for its computer hardware and software. After getting a hold of a huge portion of the market in the technological sector, IBM has focused on further expansion. It has then collaborated with various companies to enhance its market share.

Another example of a healthcare outsourcing giant is Cognizant, which initially started of as an IT company but gradually morphed into an outsourcing, consultation and information security giant.

In the year 2016, it was estimated that healthcare BPO giants such as IBM, Cognizant, etc. held 11.2% of the total global market share.

How does the MBPO work?

Initiated in the 1980s, MBPOs in particular come into play when a need to remove the hindrance faced by doctors on an administrative level is raised.  MBPOs in turn reduce the workload of a medical practice by 50%, streamlining its payment procedures and allowing it to focus solely on patients.

Medical business process outsourcing starts off by choosing a vendor. Before you finalize a vendor, it is advised to run a background check on him and look at his past customers’ reviews. Ideally a vendor should excel in training staff members aiming to optimize customer experience and expedite operations, consist of a skilled IT staff to handle all your IT related tasks and have call center agents onboard to deal with client complaints and queries. Crucial to the growth and sustainability of a MBPO, the vendor must provide billing services that remove the complexity associated with them for the medical practitioner.

It isn’t necessary for a healthcare practitioner seeking the help of a BPO to outsource all the departments of the company at once. He can utilize the services of a BPO whichever way he seems is adequate. Outsourcing may seem like an onerous task at first, however it doesn’t have to be. You can simply begin by outsourcing a limited amount of your tasks. The most common initiation is to outsource your IT and data entry operations because these tasks are relatively easy and by checking out the results you can get an idea about the service quality a particular vendor provides. As you move forward, all the billing collections and documentation can be assigned to the vendor. Furthermore, as you realize the competence of a vendor, you can further allocate tasks related to customer satisfaction and patient dealing.

MBPO is based on five management steps. MBPO starts off with business development and product expansion, develops cutting-edge insurance plans for customers, come up with strategies to attract and retain patients, determining the risk associated with applying a certain policy and taking the responsibility of any lost payments and making up for it. Lastly, member management can also be outsourced. It includes getting new members onboard and dealing with the concerns of the old ones.

MBPOs run analysis on hospitals/practices through their cutting-edge analytic tools. This helps them understand the standing of a particular hospital against another medical practices. The medical service provider obtaining the help of an MBPO, after becoming aware of its standing can improve its weak areas. For example, if the waiting time of a practice is higher than the average waiting time then it is clear that the hospital needs to work on making it better.

So now that we have established how an MBPO works, let’s take an in-depth look at the benefits it provides a hospital with.

Benefits of MBPOs:

1.Cost cutting

Acquiring an office space and purchasing technological equipment to run a personal call-center, manage billing procedures and execute collections can create a hole in the budget of a practitioner. In addition to that, you need a technical staff to keep the machines running and fix them in case of bugs. So, add the crippling salaries of tech experts on top and it becomes almost unfathomable to make much profit.

MBPOs help you bid farewell to high rents and excruciating tech expert salaries.

Given below are some ways through which MBPOs help cut down cost:

  • Convert fixed cost into variable cost:

MBPOs help you eliminate fixed cost. By removing fixed cost, you only have to pay for services you receive or when you generate revenue. For example, your graphic designer Bridget will get paid $100 a month regardless of the amount of work she has done. However, if you hire Sabrina, a freelance graphic designer, on an hourly basis, you will only be billed for the work you receive. This is an ideal case of converting a fixed cost into a variable cost.

  • Lower the cost of human resource professionals

Recruiting and managing employees of non-core functions can be a formidable task. People of these non-core departments can have turnover, conflicts, training needs etc. which is why, it’d be crucial for an HR to be at their service. However, this increase the costs associated with an HR as well. Plus, it is quite possible that you may need more than one HR. By outsourcing billing, customer relations, accounting etc. you save a significant cost.

  • Provide high quality of service

Your vendor will be focused on meeting the suggested quality of service, however, for you to acquire a high-quality standard whilst managing all the other operations, will be quite difficult and costly. The tools BPOs use to measure KPIs puts shortcomings of your practice to the forefront and you can easily eradicate them.

  • Make sure patients return

Outsourcing customer care functions will be a big leap towards ensuring that the customers return. It is important to remember the importance of after sale services. Vital to the success of a medical practice, a hospital should ensure a customer is satisfied after acquiring its services.

2.Revenue growth

Reduced costs don’t always lead to an increase in revenue, however in this case they do. After going over the above points, it is quite evident that a medical practitioner is able to save a huge amount of money by outsourcing. Statistics show the hospitals that outsource their collections, increase their revenue, giving a boost to their overall profit.

Realize, that in order to ensure that a MBPO actually helps you generate more revenue, you have to do your research before getting onboard with one.

3.Access to cutting-edge revenue cycle management systems

For a medical practice to thrive, it is important to use robust and competent revenue cycle management system to increase revenue. For some midlevel firms, purchasing RCM systems isn’t fathomable as for them it could mean the difference between breaking even or getting bankrupt.

However, outsourcing isn’t just limited to companies on the verge of bankruptcy. For example, a hospital opted for a BPO when the need to update their RCM system was raised. Whether you have to purchase an RCM software or you have to upgrade it, either way it is expensive and by outsourcing you save a major chunk of your revenue.

4.Deal with staffing issues

Support positions like billing, customer care and accounting aren’t immune to problems. At times, employee turnover in such positions is very high which is why a lot of time and money goes into recruiting employees. This creates an additional problem of advertising your open positions and the cost associated with it messes up with the budget. Yet another issue is that the more employees a company has, the more benefits it has to give out to them. So, keeping these facts in mind, it makes sense to outsource these functions instead of dealing with the problems and costs revolving around them.


Outsource agents pay attention to detail because they know any errors can be identified by the internal employees easily. They are held accountable for any concerns or issues that are raised. Since this accountability is practical and legal, their prime focus stays on it.


This is probably an underrated factor, but an important one. Even though the cost saving and accountability benefits of a BPO are significant, we shouldn’t overlook the efficiency with which the work is done. BPO agents are qualified with plenty of experience in the area they are working in, which means they are clearly knowledgeable in their field. Their expertise helps the practice obtain error free and reliable results.

Final words:

Medical billing outsourcing services are no longer a futuristic fantasy. In this day and age, outsourcing agencies have prevailed and it has pretty much become the norm to obtain services of BPOs. Outsourcing in the field of medicine is not a new concept, which is why we can tell you a lot of research and development to make the procedure swift and effective has been done already. In order to shed off tons of work that your practice is burdened with and for the best results, we recommend you to outsource your non-core medical operations. These non-core operations, if not dealt with properly can slow down your practice and result into a raise in cost and a hinderance in your core operations. So hopefully by now, you have understood the importance of hiring a MBPO and you will look into it for your own practice.

Leave a comment

OutSquare MD © 2019. All rights reserved.