Philippine medical transcription rewrites self amid global changes

Published by rudy Date posted on August 10, 2010

AT THE height of the call center boom at the early part of this decade, medical transcription was touted as the next bright spot for the country.

With a business that had already been tested in India, this field of outsourcing was turning out to be a natural niche for any country that could produce and sustain a decent pool of English-speaking graduates of medicine and natural sciences.

To be sure, the country’s dip into medical transcription was not bad at the start. In fact, the first surge of numbers was encouraging. Five years ago, there were more than 100 medical transcription companies in the country.

As of end of 2007, the work force of the sector stood at 10,000, data gathered from the industry organization Medical Transcription Industry Association of the Philippines, Inc. (MTIAPI) showed.

Fast forward to recent years and the landscape of the industry has changed considerably.

Along the way, there were mergers and acquisitions.

Two of the highly publicized movements in the industry were the acquisition of SPI Technologies of the medical transcription business of India-based KGMT in 2005 and the buyout of PeopleSupport, Inc. of US-based transcription and captioning company Rapidtext, Inc. the following year.

An indication of how the business process outsourcing (BPO), as a whole, is constantly evolving, SPI is now wholly owned by ePLDT, Inc. while PeopleSupport was acquired by an Indian company Aegis BPO.

In addition, some medical transcription companies closed shop while others ventured into other businesses.

Dwindling numbers

“There are 50 medical transcription companies now compared to five years ago when there was double that number. Only the legitimate players were able to survive the business forces that challenged the industry,” Myla Rose M. Reyes told BusinessWorld. Ms. Reyes is the MTIAPI president and managing director of Total Transcription Solutions, Inc., one of the 50 remaining players.

She said this was a result of various factors and issues, especially those in the areas of capacity building, quality of output, market competition and economic conditions.

At present, the Philippines remains a “distant second” to India in terms of the volume of medical transcription works being redirected to the country.

“Cost and labor arbitrage have been of great advantage considering the huge work force in India compared to the Philippines,” Ms. Reyes said.

US-based medical transcription companies are looking at capacity or the volume of work force as the primary consideration before awarding jobs to an offshore destination. India, she said, has been able to sustain a massive pool of medical transcrip-tionists.

Two years ago, the industry group found out that almost 85% of the medical transcription companies here were small with only 15-seat to 50-seat operations.

“While the Philippines maintains its reputation for better quality medical transcription, the thinning price points and margins are limiting the local companies’ ability to offer attractive career options and compensation packages for medical transcrip-tionists,” she said.

Not an easy job

Indeed, a medical transcriptionist’s job is no easy task as searching for talents for companies.

Aspiring transcriptionists undergo a series of written exams, many of which deal with the definition of medical terms.

There is also the audio test where the applicant encodes what he hears while simultaneously maneuvering the foot pedal that is used to manage the recording tape.

“It takes several months to develop the core competencies needed to do the task,” Ms. Reyes said of the training.

Despite these challenges, Ms. Reyes remains confident of the prospects for the local industry.

Demand for outsourced medical transcription works, she said, would continue on the back of a growing and ageing population in the West and the need for electronic documentation that can be shared easily among providers, third-party players, regulators, consumers and health information systems.

In February last year, the US government rolled out a stimulus package known as the American Recovery and Reinvestment Act of 2009.

The program has set aside as much as $19 billion in funding aimed at advancing the health information technology use in the medical industry through programs such as the adoption of electronic health records.

“The market opportunity remains favorable for medical transcription as it is still very much a part of the health care revenue cycle,” Ms. Reyes said.

Back in 2007, the global health information management services market was estimated at $12 billion.

With these changes, Ms. Reyes said the industry group is now “shifting its gears” to add health care management outsourcing due to changes in the global landscape of the industry.

As a result, medical transcription companies here have begun to offer other medical records documentation services such as medical coding and billing, electronic medical records (EMRs) and claims management.

“We have the most relevant talent pool that needs minor skills polishing to be able to meet the demands of the global market,” she said.  –Businessworld

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