United States (U.S.) Medical Coding Market Highlights 2019-2028
The market size for United States (U.S.) medical coding recorded a value of USD 4050.4 million in the year 2019 and is further projected to cross a market revenue of USD 8157.9 million by the end of 2028. Additionally, the United States (U.S.) medical coding market is forecasted to grow with a CAGR of 8.8% during the forecast period, i.e., 2020-2028.
United States (U.S.) Medical Coding Market Overview
Medical coding is the translation of healthcare procedures, diagnoses, medicals services, and equipment into universal medical alphanumeric codes by medical transcriptionists. Medical coding not only aids in uniform documentation across the healthcare facilities but also allows the administration to look after the prevalence and effectiveness of treatment in their facility. The medical coding transcription process can be divided into a six-tier hierarchy, such as retrieving patient information, pre-coding, assigning codes, quality audit, customer feedback and implementing challenges.
The United States (U.S.) medical coding market is thriving on account of the increasing advancements in software and technology in the healthcare sector, along with the growing utilization of data analytics, and the advent in data enrichment tools, such as mobile health or mHealth and electronic health records (EHRs), among others. Further, rising implementation of IT in the healthcare sector for real-time data monitoring in order to effectively manage the patient records is further anticipated to promote the market growth. Additionally, backed by the increasing concern for data security, healthcare organizations are increasingly outsourcing numerous tasks to offshore companies, which is anticipated to create opportunities for market growth. The offshore medical coding firms are known to be a part of the revenue cycle management process of the healthcare organization and therefore handles all the medical billing tasks for both private and public sectors. Moreover, increasing dependence on technology, along with the rising number of aging populations is expected to result in the increased use of electronic health records (EHRs). Such factors are anticipated to promote the growth of the United States (U.S.) medical coding market in the future. The United States (U.S.) medical coding market is further projected to cross USD 4500 million by the end of 2021. CLICK TO DOWNLOAD SAMPLE REPORT
Market Segmentation Synopsis
By Patient Type
The United States (U.S.) medical coding market is segmented by patient type into inpatient and outpatient. Among these segments, the inpatient segment with respect to hospitals registered the largest market share. Inpatient medical coding includes the facilities offered to the patient during their extended stay at hospital premises. It encompasses acute and long-term care hospitals, hospices, skilled nursing facilities, and home healthcare services. A medical coder maintains the extensive and intricate patient records, which is inclusive of a variety of diagnostic tests and treatments conducted during their stay. The outpatient segment in the United States (U.S.) medical coding market is further anticipated to grow with the highest CAGR of 9.8% during the forecast period.
The market is further segmented by end-user into hospitals, diagnostics centers and others. Among these segments, the hospitals segment is projected to grab the largest market share of 80.29% by the end of 2028 on account of the rising number of hospitals in the nation, which is expected to create numerous opportunities for the adoption of medical coding solutions.
Additionally, the United States (U.S.) medical coding market is segmented by service mode into in-house and outsourced. Among these segments, the outsourced segment with respect to hospitals registered the largest market share of 77.50% in the year 2019 and is projected to grow with the highest CAGR of 9.3% during the forecast period.
The market is also segmented by classification into international classification of diseases (ICD), healthcare common procedure code system (HCPCS), current procedural terminology (CPT), international classification of functioning, disability & health (ICF), and diagnostic-related groups (DRGs). Among these segments, the international classification of diseases (ICD) segment with respect to diagnostic centers is projected to register the largest share of 67.85% of the market in the year 2021. The international classification of diseases (ICD) type of medical coding classification is a medicine diagnostic tool which is used to classify and monitor causes of injury and death, and for maintaining information for health analysis which helps in the instant study of mortality and morbidity trends. According to the World Health Organization (WHO), in May 2019, the Seventy-second World Health Assembly has adopted the latest version of ICD, which is ICD-11. This version would come into effect on the 1st of January 2022, and would contain 80,000 concepts, 17,000 categories, 120,000 terms and more than 1.6 million clinical terms interpretation. The newly added version of ICD would require advanced medical coding training for the coders, which in turn is anticipated to drive the growth of the segment in the coming years.
Moreover, the United States (U.S.) medical coding market is also segmented by solution into professional fee coding, facility coding, emergency department medical coding, risk adjustment coding and other coding solutions. Amongst these segments, the facility coding solutions with respect to diagnostic centers is projected to grab the largest market share of 56.64% in the year 2022.
Market Drivers and Challenges
Growth Indicators
Growing Demand for Streamlining of Hospital Billing Procedures to Expand the Market Growth
Over the past few years, the number of people seeking health care services has considerably increased. This can be attributed to the rapidly increasing aging population in tandem with technological advancement in the healthcare sector. Moreover, the increasing involvement of the government pertaining to the healthcare reimbursement services for Medicaid and Medicare patients has also resulted in an increased demand for qualified medical coders. Additionally, the rising demand for streamlining of the hospital bills and medical records of patients on account of the rapidly increasing number of medical tests, treatments, and procedures in the upcoming years is a key factor expected to propel the market growth. The market is also anticipated to grow significantly on account of the growing expenditure of the government of United States. According to the statistics by the World Bank, the current expenditure on health in the United States grew by around 35% of the GDP between 2000 and 2018.
Rapidly Increasing Number of Healthcare Frauds to Drive the Market Growth
According to the statistics by the National Health Care Anti-Fraud Association (NHCAA), in the United States, in the year 2018, USD 3.6 trillion was spent on health care. Additionally, the statistics also stated that around 3% of the total health care expenditure was estimated as the value of financial losses caused due to healthcare fraud.
The increasing occurrences of healthcare frauds in the United States is one of the major factors anticipated to propel the demand for medical coding services. Additionally, frequent updates and revision of the classification systems in tandem with the increasing adoption of proper coding and billing procedures in hospital and diagnostic centers revenue generation cycles are also expected to drive the market growth during the forecast period. For instance, to combat the issue of rising number of cybercrimes in the health insurance sector, the regulatory bodies in the United States incorporated the Health Insurance Portability and Accountability Act (HIPAA) in the year 1996 to protect the confidentiality of information of the patients. Over the years, similar advancements followed by the governmental bodies in the United States, including the Health Information Technology for Economic and Clinical Health Act (HITECH Act) in the year 2009. The development of such stringent regulations to counter cybercrimes and frauds are also anticipated to drive the market growth during the forecast period.
Restraints
Data Security and Privacy Concerns to Hamper Market Growth
The increasing potential applications of medical coding has undoubtedly created numerous opportunities for the growth of the United States (U.S.) medical coding market. However, with the increasing innovations in medical technology, along with the growing adoption of internet of medical things (IoMT), there is a growing concern for the vulnerabilities and the privacy and data security challenges associated with such technologies. Despite of numerous stringent regulations for limiting cybercrimes, there is still a growing concern amongst healthcare organizations for the rising number of ransomware attacks and data breaches, which is also anticipated to hamper the growth of the United States (U.S.) medical coding market during the forecast period.
Impact of COVID-19 on United States (U.S.) Medical Coding Market
The coronavirus pandemic has dramatically impacted the growth of the United States (U.S.) medical coding market. Prior to the COVID-19 pandemic, medical coding was recorded to be one of the top twenty fastest growing occupations in the United States, whereas, with the impact of the pandemic, the requirement for medical coding fell by around half the share. However, it is anticipated that with the rising number of COVID-19 patients and the increasing number of patients visiting hospitals for treatment, the demand for medical coding in the nation would grow at a significant pace in the days to come.
Top Featured Companies Dominating the Market
Some of the prominent players in the United States (U.S.) medical coding market are 3M, Conifer Health Solutions, LLC, Coding Network, Maxim Healthcare Group, Aviacode Inc., Managed Outsource Solutions, and I-conic Solutions.
