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The Philippines is the nearest competitor to India in terms of offshoring maturity as well as cost attractiveness.
Though much has changed since the nineties, managing costs remains the most pressing issue for the American healthcare companies. For decades transcription was outsourced to another city or in some cases to another state in the US. However, due to worsening cost pressures and a widening demand-supply gap, tapping global resources has become an obvious choice. Hence, since the 1990s offshoring of transcription work has picked up steam. India, Philippines, Sri Lanka, Pakistan, Malaysia, South Africa are some of the offshore destinations for medical transcription. However, the offshore industry is dominated by India with an estimated market size of $195 million of the offshored market for 2005. India and Philippines While India dominates the medical transcription space, the Philippines is the nearest competitor to India in terms of offshoring maturity as well as cost attractiveness. There are less than 50 medical transcription players in Philippines, most of them micro to medium in size. Comparing India and Philippines |
| Parameters | Philippines (as of 2004) | India (as of 2004) | English speaking population | 84.5 million | English is spoken as a second language by over 200 million Indians | | Graduates / year | 30,000 | 400,000 | No. of medical transcription companies | <50 | >250 | | Industry manpower | 5,000 | 18,000 | | Average billing rates | 4 to 12 cents per line | 4 to 12 cents per line | | Salaries | P8,000 to P11,000 per month (USD 150-200) | INR 7,000 and 12,000 per month (USD 150-250) |
Source: ValueNotes' report on The US medical transcription industry: Perspective on outsourcing and offshoring |
Compared to the availability of 400,000 graduates per year in India, Philippines produces a mere 30,000 graduates annually. Philippines however, enjoys the advantage of closer cultural affinity with the US. Despite better English capabilities, Philippines suffers from the problem of scalability due to low manpower availability thus dampening entry/growth of large players. Given below is a list of the major vendors offering medical transcription services in the Philippines. Key vendors in Philippines |
| Company Name | About the vendors | | eData Services Philippines | Specializes in Cardiology, Endocrinology, Hematology, Neurology, Oncology, Ophthalmology, Orthopedics, Pediatrics, Psychiatry, & Urology. | | Global Data Processing | Employs 180 people and specializes in Cardiology, Dentistry, Dermatology, Geriatrics, Ophthalmology, Orthopedics, Pediatrics & Psychiatry. | | Medscribe Asia | An MTSO and a training company | | MT Link Asia | Employs over 100 people and specializes in Operative Reports, Discharge Summaries, Consultations, Emergency Room Care and Radiology. | | Northern Transcriptionworks | Services include transcription works, script editing and data flow. | Total Transcription Solutions | Started in 2001; employs 11 management people and 125 students to provide medical transcription services for hospitals and clinics in the US. | | Transkripsyo | Specializes in Orthopedics, Neurology, Cardiology, Respiratory /Pulmonary /Allergy, Urology, Pediatrics, Geriatrics, and Hematology/Oncology. | | SPi | Provides transcription for all types of medical reports, clinic notes, referral letters and emergency documentation. | i-Xcel Master Outsourcing | Services offered in the healthcare sector include medical transcription, medical coding and medical billing |
Source: ValueNotes' report on The US medical transcription industry: Perspective on outsourcing and offshoring |
Going Forward... Given that Philippines has some natural advantages such as cultural affinity with the US, rising wages and attrition issues in India will force buyers and vendors to diversify - and Philippines is well positioned to pick up the slack. Further, the image of $2.1 billion Philippine BPO industry is also rapidly improving leading to increase in the scope of services under healthcare segment such as medical billing, coding and accounts receivables. Interestingly, much of this Philippine capacity creation will be driven by Indian and North American vendors. While a large number of locations will vie to take advantage of India's rising costs and buyer's needs to diversify risk, we believe that Philippines will be one of the biggest beneficiaries.
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