Building an Ideal Partnership When Outsourcing Healthcare Processes

by | Published on Aug 31, 2015 | Business Process Outsourcing

Outsourcing Healthcare Business ProcessesBusiness process outsourcing is steadily increasing in the healthcare sector as it assures considerable savings, improved performance and high quality patient care. The U.S. healthcare IT outsourcing market is expected to grow by 42.8 percent in the next five years, according to a report released last year by MarketsandMarkets. Many healthcare systems are depending on vendors for support with their ICD-10 transition. Data collection and analysis has become very important now, and this accounts for increased outsourcing in this area. Healthcare organizations can gain access to highly advanced data collection and analysis technology through vendors, and therefore need not invest substantial capital in new technology. What is significant is that now healthcare systems have started outsourcing even patient care services such as anesthesia, dialysis services, diagnostic imaging, hospital staffing and emergency department staffing. The benefits of outsourcing are mainly improved focus on patient care and availability of expertise. When outsourced emergency department services are utilized for instance, patients benefit from the service of ED physicians who focus entirely on emergency medicine and provide the best services.

Building an Ideal Outsourcing Partnership

When establishing an outsourcing partnership with a service provider, there are certain important aspects to consider.

The Outsourcing Team: Building an appropriate team of experts to drive the outsourcing process is important, as the process involves many distinctive and intricate issues that may not be addressed in other business transactions. Team members must perform evaluation and execution of processes, to ensure smooth work. The team should include members with expertise in various areas such as:

  • Financial analysis
  • Human Resource
  • Internal audit
  • Legal
  • Risk management
  • Security
  • Sourcing/procurement professionals
  • Subject matter experts
  • Tax

Identifying the Functions to Outsource: Identifying the functions to outsource is crucial. Considerations in this regard include:

  • The goal of the outsourcing arrangement
  • The potential risks involved
  • The availability of experienced healthcare outsourcing providers who can effectively provide the service
  • The competitive advantage that can be obtained out of the function
  • Cost savings
  • Internal expertise required to effectively manage the outsourced service

Selecting an Outsourcing Partner

Once the functions to outsource are determined, the next step is to select a reliable BPO company. The tasks should be assigned only to a professional firm that has been identified after adequate research. For example, in order to obtain efficient medical billing services in a limited span of time, it is advisable to join hands with a reputable medical billing company that has a well-trained team to handle the same.

Outsourcing Agreement

The outsourcing agreement should be drawn up taking into account all legal and regulatory issues. Such an agreement generally consists of master legal terms and various business, financial, operational, and service-specific exhibits such as fees, service descriptions, transition plan, reports, governance, service levels, technology, security policies, HR terms, disengagement assistance and approved subcontracts.

Service description is another important aspect that is to be mentioned clearly in the agreement. This outlines the responsibilities of the service partner. Adequate preparation and planning is required to create a service description, while allowing the hospital to define the precise functions that the business process outsourcing provider should perform.

Transition of Services

Transfer of services from the medical facility to the service provider is the next step. This stage may or may not involve the transfer of employees from the healthcare facility to the service providing firm. If the transition does not involve the transfer of employees, then there will be a knowledge transfer process wherein all technical and process information regarding the outsourced function is transferred. Depending on the exact nature and complexity of the services, the transition can be immediate or may require several months.

Establishing a Governance Structure

Establishing an appropriate governance structure is necessary to ensure the long term success of outsourcing. Effective implementation of this can be done by devoting sufficient and knowledgeable resources to the process.

Sufficient planning and effort is required to implement a successful outsourcing strategy. Once effectively implemented, outsourcing arrangements can reduce costs, increase flexibility, and allow physicians to concentrate more on patient care.

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