Medical Coding Outsourcing Trend Update: Health Systems Preparing for Cost Surge with Outsourcing

Medical coding should look to supply chain leadership for guidance in navigating increasing cost pressures in healthcare. 

Black Book recently released a poll of over 1,000 operations leaders [1]. They found that there is a clear trend of hospitals outsourcing to group purchasing organizations (GPOs) – a trend that has been increasing in recent years. This is because of a mix of factors, including complexity in the health care supply chain, growing pressure to bend the cost curve, and the ongoing need for operational efficiency. The numbers behind the trend paint a clear picture:

• 93% of hospitals report a plan to rely on current or replacement GPOs by 2026.
• 89% of small hospitals plan to outsource some supply chain functions.
• 62% of larger hospitals also plan to outsource some supply chain functions.

The medical coding outsource environment is colored by similar challenges – and it will benefit from similar solutions. Revenue cycle leaders are under ongoing pressure to reduce costs, even as medical coding becomes more complex and there is increasing pressure to expand the scope, education, and knowledge of your coding teams. 

At 3Gen Consulting, we’ve seen these pressures expand for revenue cycle departments in recent years and know that experts in the industry expect these pressures to only become more intense. 

For revenue cycle leaders, this is an opportunity. Now is an excellent time to reconsider the role of medical coding outsourcing services in your work. Look for areas of cost inefficiency, lost revenues because of increasing coding complexity, and future mounting costs from growing needs for training and education. 

All of these will help you make strong decisions in considering the position medical coding outsourcing services play in your long-term strategy, and will serve as useful information as you investigate forming new partnerships with specialized vendors.