BPO is still a grey area

Dr Saji Salam -

Clinical Process Outsourcing or Business process outsourcing (BPO) is the use of external service providers to manage a business function or unit within an enterprise. Business Process Outsourcing has been in the limelight for quite some time and the healthcare industry being labor intensive can benefit from the emerging trends among Healthcare Organizations (HCOs) to outsource business processes. The BPO space in healthcare is a highly fragmented market, with analysts currently engaged in defining and sizing the various niche segments involved. Clinical process outsourcing is one such segment, which involves the outsourcing of clinical processes offshore, to take care of some of the clinical work currently handled by physicians, nurses and paramedics.

Drivers

Some of the drivers for BPO in the US healthcare space are:

Shortage of nurses and paramedical professionals

According to a recent journal of American Medical Association Study, 20,000 patients die every year in US due to shortage of qualified nurses. HCOs are tying all routes to attract trained nurses to hospitals in US. Coupled with this is the shortage of paramedical professionals in this sector.

Greying population

As per the 1999 census the US has 74 billion Americans 50 years and older, and by 2030, one in five Americans will be 65 years or older. This has implication for healthcare industry from both a care delivery and employment perspectives.

H1B visas

The socio political compulsions have forced the US government to reduce the H1B visas, which allow professionals from other countries to work in US. As employers would have to live with less HIB workers one option would be to look at alternatives such as outsourcing whatever is feasible.

Though these scenarios provide opportunities for Indian companies, the challenges are many.

Challenges Socio political landscape

On the political front the noise is being heard both from Europe and US to limit the loss of jobs to Asian countries, which they claim would affect the US/ European economies adversely. There were some trade unions in UK, which negotiated with a major retailer to limit the outsourced call center facility in India to only 200 seats. A New Jersey senator recently presented a bill questioning some of the BPO initiatives of US government agencies.

Management challenges

In a clinical process outsourcing to India the major challenge would be the current outlook and management of hospitals in India. Hospitals by themselves, barring a few are mostly inward focused and not quite proactive in gearing up for this emerging opportunity.

Whether many hospitals in India want to diversify into this space is to be watched. The focus on BPO by HCOs in India would require considerable re orientation of work culture, including shift timings, reallocation of priorities etc.

Availability of resources

Though India has abundance of skill sets in the healthcare domain, there is a relative shortage of specialist skill sets. Moreover the need for relevant training to align existing resources to the US requirements calls for investment too.

In some areas, for instance remote radiology report generation, it needs to be seen if India has the required critical mass of specialists to handle volumes that US healthcare would outsource to India.

Process/ Technology maturity

Managing the delivery process itself calls for technology intensive and human resources intensive practices, coupled with process maturity in handling similar work. Most HCOs in India have not evolved to global standards on this aspect. Hospitals may however align with BPO/IT companies to leverage the expertise by for such expertise. Managing the disparate organizational cultures is to be addressed in that case.

Quality

Quality is critical in any service-based industry. Adoption of world-class quality processes has been a key differentiator for the Indian IT industry.

A cultue of quality calls for financial investment and long-term commitment from the healthcare community.

In fact the medical transcription Industry in India is a classic case where large-scale quality deterioration led to the near death experience faced by the sector. Though analysts talk about billion dollar markets, whether India Inc has the delivery bandwidth to address this is to be assessed, given the above mentioned factors. To me this is a typical “watch this space” scenario right now.

(The author is consultant, Healthcare & Life Sciences Practice, Cognizant Technology Solutions. He may be contacted at saji@chn.cognizant.com)