Hyderabad: There’s turbulence ahead for the Indian medical transcription industry, with proposed investments in US healthcare set to impact the local sector worth around $435 million (Rs1,940 crore).
A recent legislation on healthcare in the US plans to spend $50 billion in five years to adopt electronic medical records (EMRs) that would reduce demand for medical transcriptions, forcing smaller firms to shut shop and larger ones to rethink strategies.
An EMR is a template-driven record of patient information that a doctor can key into a computer terminal. Currently, most doctors in the US dictate into a recorder during patient interactions, which are then converted to text files by medical transcriptionists.
The Indian medical transcription industry services 75% of the medical transcription work outsourced from the US.
“When universally implemented, EMRs can either eliminate or significantly cut down the need for transcriptions,” says Neeraja Kandala, an analyst at research firm ValueNotes Database Pvt. Ltd.
The US EMR market is pegged by New York-based research firm Kalorama Information at $13.8 billion in 2009.
Small and medium-scale medical transcriptionists (of 10-500 seats) began losing clients since the American Recovery and Reinvestment Act of February 2009 earmarked $20 billion in incentives to Medicare and Medicaid providers adopting EMRs by 2014. From 2015, it proposes a schedule of penalties for non-adoption. Medicare is a US government insurance programme for the elderly, while Medicaid is for the poor.
“We are currently in a downtrend,” says Y. Gopalkrishnan, chief executive of Capintels Trans Solutions Pvt. Ltd, a Hyderabad-based, 30-seat medical transcription company. “Most small firms have seen a drop in revenue, primarily due to EMR adoption and aided by the appreciating rupee.”
A survey by management consultancy Accenture Plc of 1,000 physicians in smaller group practices (with fewer than 10 practitioners) showed that 65% of current non-users plan to implement EMRs in the next two years.
What will this mean for local outsourcers? “Indian firms will need to relook their current systems to see how best to integrate with healthcare IT (information technology,” says Dipta Chaudhury, programme manager, South Asia and Middle East, pharma and biotech practice at consultancy firm Frost and Sullivan.
“Pure labour-based transcription will now go away,” says Raman Kumar, chief executive of US-based CBay Systems Ltd, the world’s largest medical transcription firm. “Where transcriptionists will come in now is in extracting from transcription into EMR using technologies like natural language processing and XML.”
Complicating matters is the fact that EMR products are currently heterogeneous and common standards will be declared only towards the end of 2010.
How much leeway medical transcription firms have to innovate, therefore, will depend on which EMR product dominates eventually.
“Some EMR products are out-and-out transcription-unfriendly. Their intent is to eliminate the need for dictation and transcription completely,” explains Jay Vance, a US-based technology product specialist for Superior Global Solutions Inc., a large US MT service firm. “Other EMR vendors are taking a more integrated approach, which gives users the flexibility to use dictation and transcription in addition to point-and-click templates.”
Either way, Indian firms will have to rethink their niche.
Some firms are already jumping onto the EMR transcription bandwagon.
“I am considering responding to enquiries from my clients about EMR transcription,” says George Cherian, chief executive of Coimbatore-based Doctors Transcribe, a 30-seat firm. “But right now, I am only concerned with stopping the cheques from bouncing.”