Healthcare Payer Services Market | IndustryARCIncrease in Insurance Coverage Among the Population Is Projected to Drive Healthcare Payer Services Market Growth.The Healthcare Payer Services market size is estimated to reach $35.6 billion by 2026, growing at a CAGR of 11.2% during the forecast period 2021-2026. Healthcare insurance payers are organizations that set the rate for healthcare providers’ services and pay healthcare claims through premium collected or tax revenue. Healthcare payer service types include Information Technology Outsourcing (ITO), Business Process Outsourcing (BPO), and Knowledge Process Outsourcing (KPO) for various service applications such as claims management services, member management services, provider management services, Billing and accounts management services, and so on. An increase in the adoption of analytical systems in the healthcare sector is driving the Healthcare Payer Services market during the forecast period. However, the high costs associated with outsourcing healthcare payer services are anticipated to be a major challenge for the healthcare payer service industry.
Healthcare Payer Services Market Segment Analysis-By Service Type
Based on Service Type, the Healthcare Payer Services Market is segmented into Information Technology Outsourcing (ITO), Business Process Outsourcing (BPO), and Knowledge Process Outsourcing (KPO). The BPO segment is anticipated to have the largest share of the market in 2020 and is poised to dominate the market during the forecast period 2021-2026. BPO focuses on the operational aspects of the payer business by enhancing the efficiency of key processes such as data entry, claim processing, contact center, and enrollment. Moreover, BPO services also help in developing 24/7 nursing hotline solutions to assist healthcare payers in care coordination needs, and to improve their compliance with complex government regulations. The KPO segment is projected to grow the fastest at a CAGR of 12.1% owing to the rising global demand for skilled professionals, and the need to reduce costs and increase efficiency.
Healthcare Payer Services Market Segment Analysis-By Application
The Healthcare Payer Services Market based on Application can be further segmented into Claims Management Services, Billing and Accounts Management Services, Analytics and Fraud Management Services, Member Management Services, Provider Management Services, HR Management Services, Integrated Front Office Services, and Others. The Claims Management Services segment accounted for the largest share of the market in 2020 owing to the growing demand for increasing efficiency and productivity, reducing operational costs, and enhancing decision-making regarding medical claims. Moreover, the surge in the number of people subscribing to insurance plans in both developing and developed regions is further boosting the segment’s growth. However, the Analytics and Fraud Management Services segment is anticipated to witness the fastest growth during the forecast period at a CAGR of 12.7% owing to growth in demand for claim analytics in the healthcare sector.
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Healthcare Payer Services Market Segment Analysis-By Geography
The Healthcare Payer Services Market based on Geography can be segmented into North America, Europe, Asia-Pacific, South America, and the Rest of the World. The North American segment is projected to dominate the Healthcare Payer Services market during the forecast period 2021-2026 with a market share of 33% owing to the presence of highly developed healthcare infrastructure, advancements in healthcare technology, high customer awareness levels, and growing insurance coverage penetration among the population in the region. Moreover, the presence of key industry players in North America such as Accenture, Cognizant, Concentrix Corporation, Xerox Corporation, and Sutherland Global Services ensure lower costs and more options for customers. The Asia Pacific region is predicted to register the fastest growth owing to a rise in medical infrastructure development and lower IT service costs in countries such as India and Vietnam.
Healthcare Payer Services Market Drivers
Increase in Insurance Coverage Among the Population is Projected to Drive Market Growth
The increase in insurance coverage among the global population is driving the market for healthcare payer services. For instance, according to the United States Census Bureau, around 91.4% of the US population had health insurance for all or part in 2020, of which 66.5% was private insurance. Moreover, in 2020, 87.0% of full-time, year-round workers had private insurance coverage, compared to only 85.1% in 2018. Meanwhile, developing countries like India are also anticipated to witness an increase in health insurance coverage owing to favorable government policies. For instance, the Union Budget of 2021 increased the FDI limit in insurance from 49% to 74% while around $413.13 million was infused into state-owned general insurance companies to improve their overall financial health.
Covid-19 Pandemic is Anticipated to Boost Service Demand
The surge in the number of Covid-19 infections and hospitalizations has had a major impact on the healthcare systems of North America, Asia Pacific, and Europe. The rapid influx of patients and the overburdening of the healthcare system has increased the demand for Healthcare Payer Service outsourcing in order to increase efficiency, reduce errors, control expenditure, reduce fraudulent activities, manage medical documents, and providing network management. The virus has infected more than 219.4 million people and caused the deaths of around 4.56 million people worldwide. The fear of the pandemic is causing more people to purchase health insurance plans, which will further drive the market.
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Healthcare Payer Services Market Challenges
The Hidden Cost of Healthcare Payer Services is Anticipated to Hamper Market Growth
The hidden costs associated with outsourcing healthcare payer services are a key challenge faced by the market. Healthcare organizations may overestimate the quantity of work performed by BPO providers which can result in higher-than-expected overall costs. Moreover, the instances of legal expenses owing to working with BPO services are higher if any disputes occur between the healthcare provider and service provider. Other aspects include fluctuations in work quality and over-dependence on the Healthcare Payer Service provider. Furthermore, the language, cultural and other communication barriers can also hamper growth as the service provider may be based out of a foreign country.
Rising Data Security Concerns is Projected to Limit Growth Opportunities
The risk of security breach and data leaks significantly increase when working with Healthcare Payer Servicing companies. This can severely affect demand as data such as patient contact information, illness, insurance plan, medical history, and so on are highly sensitive and protected by law. Breach or leak of such data may have a disastrous impact on the healthcare provider as it reduces patient confidence. Moreover, it may also lead to lawsuits which can cause major losses for the company. Healthcare data breach incidents increased by 55% in 2020 from the previous year. Over 600 instances of breaches were recorded in 2020, affecting more than 26 million people.
Healthcare Payer Services Industry Outlook:
Product launches, mergers and acquisitions, joint ventures, and geographical expansions are key strategies adopted by players in the Healthcare Payer Services Market. The top 10 companies of the industry include:
Cognizant Technical Solutions
Concentrix Corporation
Accenture PLC
HCL Technologies Ltd
Xerox Corporation
Wipro Ltd
Hinduja Global Solutions Ltd
Exlservice Holdings Inc
Teleperformance Group
Sutherland Global Services
Partnerships/Product Launches:
In January 2021, UnitedHealthcare expanded the availability of virtual care with local physicians for members enrolled in employer-sponsored plans. The company also introduced a new Virtual Primary Care service designed to increase convenience and simplicity in accessing medical services.
In August 2020, Oscar, a tech-based health insurance company, Holy Cross Health announced a partnership and launched a co-branded Medicare Advantage Plan. The new plan helps combine Holy Cross Health and Memorial Healthcare System’s extensive physician network with Oscar's highly personalized member experience. Holy Cross Health is a health research and teaching institution and Memorial Healthcare Systems and a leading healthcare service provider
Key Takeaways
Geographically, the North American Healthcare Payer Services market accounted for the largest share in 2020 owing to high healthcare expenditure and rising demand for healthcare payer services in the region.
An increase in health insurance coverage in major emerging economies such as India and China is driving the market during the forecast period. However, an increase in data leaks, data breaches, and loss of customer confidence are major challenges for the market.
Detailed analysis on the Strength, Weaknesses, and Opportunities of the prominent players operating in the market will be provided in the Healthcare Payer Services Report.
Relevant Report:
Healthcare Outsourcing Market
https://www.industryarc.com/Report/1279/Healthcare-Outsourcing-Market-Analysis-Report.html
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