Healthcare Revenue Cycle Management, ICD-10, Claims Reimbursement, Medicare, Medicaid

Practice Management News

Black Book Names Optum360 Top HIM, Coding Outsourcing Vendor

A recent Black Book survey ranked the top HIM and coding outsourcing vendors and found that demand for outsourced solutions increased after ICD-10 implementation.

By Jacqueline LaPointe

- Optum360 earned the top spot for health information management (HIM) and computer-assisted coding outsourcing vendor among hospital chains, systems, corporations, and integrated delivery networks as well as independent inpatient facilities, according to a recent Black Book Market survey.

Coding outsourcing demand increased after ICD-10 implementation, Black Book survey showed

The top vendor list based on client experience and customer loyalty also included nThrive (MedAssets + Precyse), M*Modal, Navicure, Nuance, and 3M Health.

The survey of 1,865 hospital coding, medical record, and financial business office leaders showed that HIM and coding outsourcing solutions, especially those from top-ranking vendors, increased after ICD-10 implementation. Approximately 72 percent of hospital participants reported that their organization outsourced more than half of their coding needs in 2016.

The number of hospitals that elected to outsource coding functions rose from 53 percent before ICD-10 implementation in 2015 and 20 percent in 2014.

The push for more coding outsourcing stemmed from hospitals experiencing more challenges with coding productivity and claims reimbursements than originally expected after ICD-10 implementation, the survey stated. While 51 percent of hospital HIM executives in 2015 expected their organization to be ready for the ICD-10 transition, 30 percent re-surveyed in 2016 reported that their organizations were not as prepared as anticipated.

READ MORE: Exploring MIPS Advancing Care Info, Improvement Activities

Using more coding outsourcing solutions, however, may have helped to alleviate some of the challenges hospitals experienced after ICD-10 implementation, respondents noted. Nearly 81 percent of respondents who said their hospitals were not as prepared as expected expressed regret that they did not add incremental in-house coding solutions or outsource coding and HIM functions to address productivity challenges stemming from ICD-10.

“Outsourced coding has emerged as a compelling solution to the immense challenges of ICD-10,” stated Scott Wilson, Partner over Black Book’s outsourcing and managed services research divisions.

The survey supported the view that coding outsourcing led to significant productivity and hospital revenue improvements. About 96 percent of hospitals with over 150 beds that had outsourced computer-assisted coding for more than a year respectively reported over $1 million in gains since the third quarter of 2015. The gains came from collecting appropriate revenue and claims reimbursements.

Hospitals also experienced financial improvements shortly after implementing outsourced coding solutions. Sixty-seven of surveyed coding outsourcing customers reported financial and efficiency improvements within 90 days, while 82 percent of hospitals over 200 beds that outsourced coding before the end of 2016 saw over a four percent increase in projected revenue.

Coding outsourcing services also improved quality of care for hospitals, the survey found. Ninety-two percent of hospitals that outsourced coding functions experienced quality improvements and case mix index increases.

READ MORE: Healthcare Consumerism Challenges Primary Care Business Models

“CAC [computer-assisted coding] outsourcing is being seen as the panacea for regaining lost coding productivity and improving hospital financial operations,” said Wilson.

Consequently, more hospitals chose to outsource more key coding and HIM functions in 2016 or consider outsourcing as a solution. Twenty-six percent of hospitals said that their organizations increased the percentage of computer-assisted coding and HIM outsourcing compared to last year.

Forty-eight percent of hospitals that did not use computer-assisted coding technology or outsourcing before the third quarter of 2016 also said that they plan to outsource in the next six months.

The perception of HIM and coding outsourcing services shifted in the last year, the survey indicated. About 72 percent of hospitals that used coding outsourcing plan to extend their contracts with high-performing vendors until 2019, suggesting that outsourcing is no longer viewed as a stop-gap solution until in-house resources are acquired.

Additionally, the survey stated that the outsourcing market for HIM and coding has changed in response to an increase in demand. The vendor competition narrowed in 2016 as most hospitals (60 percent) went from using at least five different vendors prior to ICD-10 implementation to 40 percent of hospitals working with just one vendor in 2016.

READ MORE: AHA, FAH Oppose Proposed Physician Self-Referral Law Changes

The consolidation of market competition suggests that the once fragmented HIM outsourcing industry is now meeting ICD-10 needs of providers, Wilson explained.

The offshore HIM outsourcing market has also improved in the eyes of providers because of the rising demand for coding solutions, the survey showed. Some coding and HIM outsourcing vendors have recently collaborated with offshore staffing companies to handle the increase in demand, resources, and competencies.

As a result, the number of contracted HIM executives that shied away from using offshore coding vendors decreased from 84 percent in 2014 to just 22 percent in 2016.

“Offshore business process outsourcing (BPO) companies have diligently tightened policies and operations to response to HIM concerns, including advanced cybersecurity efforts, stronger service level agreements, and multiple layers of quality checks,” said Wilson.  “All these efforts are collectively ameliorating offshore clinical coding services and improving hospital satisfaction.”

Dig Deeper:

Key Ways to Improve Claims Management and Reimbursement in the Healthcare Revenue Cycle

Which Healthcare Big Data, Business Intelligence Vendors are Most Popular?


Join 30,000 of your peers and get free access to all webcasts and exclusive content

Sign up for our free newsletter:

Our privacy policy

no, thanks

Continue to site...