Medical billing software is used by the medical billers and coders to deliver administrative services and file medical claims. Professionals and institutions also use the software for coding, billing, and managing clinical charting, patient intake, and revenue cycle. Medical billing software offers umpteen benefits, including accurate bills, reduced administration errors, reduced insurance claim denials, invoice tracking, faster payments, and digitalization, further increasing efficiency and accuracy. The medical billing market is expected to grow with a CAGR of 10.5% during the forecast period due to increasing digitalization in healthcare and the need for reducing healthcare costs.
Digitization in the Healthcare Sector
Digitization has transformed the healthcare sector by improving patient treatment delivery systems, and software technologies, which have enabled easy access to healthcare data using cost-saving automated billing systems. The ‘Administrative Errors: Technical Series on Safer Primary Care 2016’ report published by the World Health Organization (WHO) estimated that about 5–50% of medical errors in primary care are administrative errors, further prompting the need for digitization.
Rising Duplicate Insurance Claims to Drive the Market Growth
Software application eases interoperability between multiple domains and sub-domains of hospitals. The software also manages patient data and their treatment information and uses advanced methodologies to provide smooth interoperability between insurance companies and hospitals. As per the article by Kaiser Family Foundation, the insurance companies deny nearly one out of five claims due to duplicate claims and lack of transparency. Thus, the use of advanced methodologies and interoperability between these domains will aid in reducing the number of fraudulent claims, further boosting the market growth.
Threat of Cyber Crimes
In the last few years, cyber-crimes have been rising at a concerning rate, further increasing privacy concerns pertaining to the patient’s medical history and other personal information. In 2015, the Indiana Attorney General informed that data of over four million patients of 230 hospitals were exposed during the cyber-attack on Indiana-based firm, Medical Informatics Engineering (MIE). Increasing cyber threats such as malware, phishing, Man in the Middle attack, and Trojans, among others, are hindering the market growth to some extent.
Impact of COVID-19
The pandemic has compelled the governments across the globe to impose a lockdown. Lack of staff has necessitated the use of healthcare IT services, such as medical billing software, electronic health records (EHR)/ electronic medical record (EMR), and practice management software. Additionally, the cloud-based services have been witnessing a significant surge in demand over on-premise services due to its adaptability and cost-effective nature.
Medical Billing Software Market: Segmentation
On the basis of component, the medical billing software market is divided into the solution – revenue management, practice management, and claims management among others, and services – professional services and managed services.
Revenue cycle management segment couples the administrative data to amalgamate the business and the clinical side of healthcare. In the U.S. the key components of the revenue cycle management include it's Health Insurance Portability and Accountability Act (HIPAA) compliance as it helps in reducing the administrative cost. The revenue cycle management comprises of the following path: Patient pre-authorization, eligibility, and benefits verification claim submission, payment posting, denial management, AR follow-Up, and reporting.
As per the Healthcare.gov, in 2017, the insurance companies of the U.S. denied 18% of the total in-network claims that is it denied it denied 41.9 million claims ut of 232 9 million thus substantial revenue cycle management in the medical billing software will benefit the hospitals by reducing the number of administrative errors and further aid the patients in receiving the right claim.
The practice management software deals with the day to day tasks of the hospital such as scheduling appointments, patient statistics, billing tasks, and maintain a list of insurance among others. As per the Natinal Ambulatory Medical Care Survey, 2016, there were approximately 883.7 million visits to physicians' offices thus increasing the need for the practice management software for the Maintainance of the number of visits.
Claim management provides management of life insurance and health insurance claims. They aim to provide a complete reimbursement of the claim. As per the: Health Insurance Coverage: Early Release of Estimates From the National Health Interview Survey, 2018, there was a decrease in the number of insured individuals with a rate of 7.9%. This downfall can be attributed to the increase in the number of claim denials in the nation thereby rising the need for claim management software.
On the basis of type, the medical software billing market is bifurcated into professional billing and institutional billing.
Professional billing is done by certified individuals with knowledge of medical billing as well as medical coding. They work as trusted partners with good market expertise that help in generating more revenue. As per the Bureau of Labor Statistics, there will be a 13% rise between 2016 - 2026 in the number of jobs of medical billers and coders thus acting as a driving factor for the growth of this segment in the medical billing software.
Institutional billing, on the other hand, is performed by the skilled nursing facilities, and other institutions. The institutional charges are billed on a uniform billing form numbered CM -1450 (UB-04). They are in charge of performing tasks such as billing and collections. They are used for outpatient and inpatient services along with charges for the usage of hospital services such as laboratory services, use of equipment and supplies, and radiology services among others.
Government Initiatives to Drive the Medical Billing Software Market
North America dominates the medical billing software market on account of the rapid adoption of technology and the presence of leading market players, such as Kareo, TheraBill - WebPT, TherapyNotes, athenaCollector, and Practice Fusion. As per the MEdAlertHelp.org, in the U.S. the administration costs accounts for over 8% of the overall healthcare costs. The U.S. is backed by the presence of the world’s best healthcare facilities due to rising government investments in the healthcare sector, which is further driving the demand for medical billing software across the country. As per the Taxpolicycentre.org, the federal government spent approximately USD 1.1 trillion in the fiscal year 2018.
Medical Billing Software Market in Europe
Europe is projected to witness significant growth in the medical billing software market due to the rising geriatric population, increasing investments, and favorable government regulations. As per the Worldatlas.com, Italy is housing the second largest geriatric population in the world, followed by Portugal, Germany, Finland, Bulgaria, and Sweden. The geriatric populations are highly susceptible to a myriad of diseases, further rising the hospital visits and admissions.
Governments in the region are heavily investing in the healthcare sector to provide better services. As mentioned in the SGPP Meeting, in June 2019, the European commission invested about USD 1.96 billion and USD2.18 billion in research centers and health promotion and disease prevention, respectively. The Euro Cyber Resilience Board for Pan-European Financial Infrastructures (ECRB) launched a sharing initiative to safeguard the financial system and increase awareness about cyber threats, further driving the demand for medical billing software.
Medical Billing Software Market Segmentation
The Middle East and Africa (MEA)