Have you analyzed your outsourced transcription services contract recently?
- Is your current vendor charging you a fair “market” rate?
- Is your current vendor leveraging speech recognition technology for your benefit or theirs?
- Is your transcription being done overseas – without your knowledge?
- Are you benefiting financially for the work done in India or does this benefit accrue solely to the vendor providing the services?
- Are you aware of the added legal exposure you assume when having your work sent to other countries (with or without permission) not governed by the laws of the United States?
- Has the transcription services market evolved to a point where you are currently paying your in-house medical transcriptionists above market wages?
These are some of the questions recently faced by a 245-bed acute-care hospital based on the Northeast. The answers were startling:
1) Fair Rate: No
After careful evaluation we identified a significant disconnect between what the hospital thought they were being billed for and what their actual bills reflected. Unfortunately this practice dates back a long way, has given our industry a black eye and appears to be rearing its ugly head again as the industry experiences significant consolidation. This difference resulted in a 22% increase in transcription costs representing approximately $68,000 in potential cost savings annually.
2) Speech Recognition: Yes
The current vendor has publicly stated that over 83% of the work processed is being done with the assistance of speech recognition technology; although there is no mention of this to the client or in the client’s contract. When the client specifically asked if their work was being processed this way and requested to share in the financial benefit the current vendor was repeatedly evasive and eventually declined to make an adjustment. In follow-up we determined there was an additional $36,000 in potential cost savings opportunity in leveraging speech recognition technology for this client.
3) Off-shoring: Yes
The current vendor has publicly stated that over 35% of their total work volume is done overseas and they are focused on increasing this amount; although there was no mention of this to the client or in the client’s contract. To make matters worse…when the vendor was asked about off-shoring the answer was again very evasive and declined to provide an answer the hospital could respond to. What’s the take-a-way: If your current contract doesn’t specifically state “no off-shoring” or “U.S. based labor only” you can be assured there is a high likelihood the work is being sent off-shore and as such you should derive some benefit for the increased exposure you (knowingly or unknowingly) assume.
4) In-house – Above Market Pay: Yes
Again, after careful analysis we determined this hospital was spending approximately 20% more per line in-house as compared to their current “inflated” outsourcing cost per line. A potential cost savings of $85,000 annually, a figure that would increase to over $100,000 if this hospital moved to a total outsource arrangement.
In conclusion, we identified approximately $157,000 in potential costs savings for this hospital or approximately 24% of their total annual transcription spend. Imagine how surprised the HIM Director and Chief Financial Officer were when we presented these findings to them. Don’t let this happen to you.
Wouldn’t you rather be the “hero” who discovered this type of financial cost savings for your hospital?
This type of analysis is not hard and does not require a lot of time to complete…but it is amazing how many times we find prospective hospital clients who are surprised by findings like these. If you suspect your organization might be in the same boat as this one we encourage you to spend the time to ensure you are not surprised by the “games medical transcription services play.”
The American Healthcare Documentation Professionals Group offers a free, no obligation analysis, to U.S. based hospitals interested in determining how to reduce their in-house and/or outsourced transcription costs and improve the overall efficiency of their healthcare documentation process. To request our assistance, please contact Peter Reilly at [email protected] or call us at 508.925.5400 for more information.