Examining 2023 Trends in Business and Recruitment Process Outsourcing
Outsourcing involves the use of an external or outside supplier for some type of business-related need versus relying on internal resources. Two types of outsourcing that exist within healthcare today are business process outsourcing and recruitment process outsourcing. Here we explore what each one is, what they look like in healthcare in 2023 and beyond, and factors to consider if you’re considering the use of one or both.
What is Business Process Outsourcing (BPO)?
Business process outsourcing involves contracting with outside vendors to perform some of the activities required when running a business. Healthcare activities that may be outsourced include those related to data entry (entering private patient information into the organization’s electronic health record system or EHR system), medical billing and coding, and revenue cycle management.
If a healthcare organization doesn’t have enough internal resources to meet certain business needs, BPO can help fill the gap. An example of this would be having one medical biller and coder on staff when the organization creates enough work to keep two or three billers and coders busy full-time. Outsourcing the overflow for this task can help keep the organization from getting behind while also helping to reduce the stress and workload placed on current staff.
Another benefit of BPO is that it can open access to resources that might not be available internally. Maybe an organization that provides patient services doesn’t have a medical biller and coder on staff. In this case, BPO offers the organization access to someone who could take care of billing and coding needs without adding such a professional to the organization’s payroll.
One piece of research suggests that BPO may even provide both improved accuracy and financial advantages. In a 2020 case study published in the journal Production Planning & Control, researchers found that in the particular healthcare outsourcing example featured in the study, savings in excess of a half million dollars resulting, where the outsourcing firm employed Six Sigma methodologies.1 These savings were credited to reduced claim processing errors.
What is Recruitment Process Outsourcing (RPO)?
Recruitment process outsourcing involves using an external agency to recruit and hire new staff. Healthcare organizations might use RPO to onboard entry-level positions such as medical assistant, nursing assistant, patient care technician, and pharmacy technician.
Before getting into the possible benefits of RPO, it’s important to note that this resource is not a staffing agency providing temporary labor. The goal of RPO is not just to fill open positions. Instead, it is more so to fill these positions with the right people via a streamlined process that can help improve the healthcare organization’s performance.
One potential advantage of RPO is that it provides organizations access to an existing pool of talent. A company that specializes in healthcare recruitment could better connect a healthcare employer with a long list of prospects who are qualified to fill its open healthcare roles and are actively looking for work. This can reduce the amount of time and effort the healthcare employer must put into finding this talent.
RPO can also offer access to recruiting experts. Through their experience in the field, these experts may have greater knowledge as to which hiring strategies work best or how to tell if a prospect would be a good fit for a particular organization. Healthcare companies can benefit from this expertise, streamlining and potentially improving the recruitment and hiring process.
2023 BPO and RPO Trends in Healthcare
Outsourcing in healthcare is becoming “increasingly common” according to a November 2021 special article published in Mayo Clinic Proceedings.2 Reasons cited for its growing popularity include a desire to increase profits and efficiency.
At least one study has suggested that the pandemic intensified conditions that could make RPO an attractive option, including increased worker pressure leading to burnout, budget constraints, and talent management challenges.3
Data provided by market analysts further indicates that this outsourcing trend is likely to continue for quite some time. For example, the global healthcare BPO market was just over $19 billion in 2021 and it is expected to increase to over $34 billion by 2028.4
Growth is also expected in the RPO market. In 2021, this market was valued at approximately $6 billion globally, and this number is anticipated to reach just under $9 billion by 2027.5
Outsourcing Consideration Factors
It’s important for healthcare leaders to plan diligently for outsourcing, enabling them to make better decisions while also contributing to a more successful outsourcing process.2 If this is the stage that you are in, here are a few factors to consider:
- Whether you have enough internal resources to meet your needs. Do you have enough people on staff to handle your business processes without constantly paying overtime or creating too-large workloads that strain your existing staff? If not, you may benefit from a BPO. Is your human resources (HR) department able to keep up with your hiring needs, filling open positions quickly and effectively? If not, an RPO may help ease the bottleneck.
- If your internal resources have the required expertise. Sometimes it’s less about how many resources you have and more about whether they have the knowledge and skills needed to get the best results. This isn’t meant to downplay your current staff, but more so to suggest that some people have more knowledge in certain areas than others. Outsourcing business or recruitment processes can provide access to individuals with expertise in areas that your current staff may not have.
- The potential return on investment of outsourcing. When considering outsourcing, it’s important to run the numbers so you understand your potential return on investment. If you outsource your recruitment efforts, for example, how much will you save by not having to advertise and find new staff? If this outsourcing reduces your HR needs, how much will this also increase your bottom line?
- If outsourcing can get you the desired results quicker. Companies that provide outsourcing services may have a better finger on the pulse of the current market, also understanding what strategies work best. This helps reduce errors made in a trial-and-error approach, which can enable you to achieve your desired business and hiring goals faster and more efficiently.
- Whether the external entity has experience in healthcare. Working with an external entity that is familiar with the healthcare industry and all its nuances may provide a more positive experience. These entities don’t have to learn about the industry and try to adjust. They live it day in and day out and have a better idea of what methods are providing the best results based on current trends.
- The ability to customize your outsourcing options. No two healthcare organizations have the same needs. Working with an outsourcer that allows you to customize your options according to the staffing and business needs of your specific organization provides a more tailored experience. Think about the positions that must be filled and the processes you’d like to supplement and choose an outsourcer that matches these requirements.
BPO and RPO both provide some advantages. Considering the benefits they can provide your organization both today and tomorrow, along with knowing how to do your diligence when choosing a company that offers BPO or RPO, can help create a more successful outsourcing experience.
1 Sunder V, Kunnath N. Six Sigma to reduce claims processing errors in a healthcare payer firm. Production Planning & Control. 2020;31(6):496-511. https://doi.org/10.1080/09537287.2019.1652857
2 Berry L, Letchuman S, Ramani N, Barach P. The high stakes of outsourcing in health care. Mayo Clinic Proceedings. 2021;96(11):2879-2890. https://doi.org/10.1016/j.mayocp.2021.07.003
3 Gupta D. Challenges for HRM in Healthcare Amidst COVID Pandemic. ABS International Journal of Management. December 2021. https://absjournal.abs.edu.in/ABS-Journal-Volume-9-isuue-1-June-2021/article-7.pdf
4 Industry Research. Global Healthcare Market Research Report 2022. https://www.industryresearch.co/global-healthcare-bpo-market-21014432
5 360 Research Reports. Global Recruitment Process Outsourcing (RPO) Industry Research Report, Competitive Landscape, Market Size, Regional Status and Prospect. https://www.360researchreports.com/global-recruitment-process-outsourcing-rpo-industry-research-report-competitive-landscape-market-21404120