USD 16.79 billion
Report ID: SQMIG35G2210 | Region: Global | Published Date: June, 2023 | Pages: 157 | Tables: 60 | Figures: 75
U.S. Medical Coding Market size was valued at USD 16.79 billion in 2021 and is poised to grow from USD 18.4 billion in 2022 to USD 38.31 billion by 2030, growing at a CAGR of 9.6% during the forecast period (2023-2030).
The U.S. medical coding market is poised for significant growth in the foreseeable future. Large financial losses occur as a result of billing errors, insurance fraud, and misinterpretations of medical documents. The growing prevalence of ineffective medical billing and revenue cycle management has created a higher demand for revenue cycle management solutions, including medical coding software and services. The adoption of digital technologies such as electronic health records, revenue cycle management software, mhealth applications, telehealth, and the ongoing efforts towards healthcare digitalization in the U.S. are also contributing to the positive expansion of the market. Medical coding is being increasingly employed in the revenue cycle management process, with new code revisions introduced to enhance flexibility and scalability. The implementation of the new ICD-11 coding system in January 2022, featuring numerous new chapters and support for electronic health records, is having a favorable impact on market growth. This revised coding system comprises approximately 55 thousand codes for the classification of disorders, diseases, injuries, and deaths. The Bureau of Labor Statistics, Office of Occupational Statistics and Employment Projections, estimates a 7% growth in the number of medical records and health information employees between 2021 and 2031. Certified medical coders are highly sought-after in the U.S., as there is an increasing demand for standardized medical documentation. The rising workload on healthcare staff and physicians for medical coding has led to the adoption of various automation solutions. For instance, a survey conducted by Athenahealth reveals that physicians spend an average of 90 minutes working overtime on coding. Consequently, there has been a rise in the utilization of computer-assisted coding solutions, which offer rapid, accurate, and efficient medical coding. According to a survey by 3M, computer-assisted coding can increase productivity by 11-30%. Additionally, the development of AI-enabled medical coding is projected to drive market growth. Healthcare spending in the U.S. is experiencing rapid growth, and hospital administration costs are notably high. As a result, healthcare organizations are under increasing pressure to deliver quality care while reducing costs. To address this challenge, healthcare providers are adopting medical coding software and outsourcing services, aiming to decrease administration costs and enhance return on investment. This adoption is anticipated to drive the market's growth.
US Medical Coding Market is poised to grow at a sustainable CAGR for the next forecast year
Global Market Size
USD 16.79 billion
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The U.S. Medical Coding Market is segmented by classification system, component, and region. Based on classification system, the market can be segmented into ICD, HCPS and CPT. Based on component, the market is segmented into In-house and outsourced. Based on region, the market is segmented into US, Canada, Mexico and rest of North America.
Analysis by Classification System
The market is witnessing a significant revenue share from the use of ICD codes, making ICD the dominant player in the market. The implementation of ICD 11, which became effective on January 1, 2022, has contributed to its success due to its accuracy and flexibility. This coding system enables health information to be utilized for various purposes, including improving patient outcomes, analyzing quality and safety, integrating care, strategic planning, population health reporting, and delivering healthcare services. The user-friendly nature of ICD 11 codes allows for seamless integration into local digital records and information technology systems, resulting in improved user compliance, reduced training costs, and time. The segment is further bolstered by the availability of multiple ICD codes and revisions to accommodate the rapidly evolving healthcare industry.
On the other hand, the CPT segment is expected to experience the highest growth rate during the forecast period. CPT codes, which are a subset of HCPCS codes, are used to describe medical tests, surgeries, and other procedures for the purpose of medical billing. These codes are closely monitored by the government to assess disease prevalence and healthcare spending. HCPCS codes, including CPT codes, are mandatory under the Health Insurance Portability and Accountability Act (HIPAA) in the United States, which has driven their widespread adoption by Medicaid, Medicare, and third-party insurers.
Analysis by Component
The dominant component in the market is the in-house segment, which involves organizations managing the revenue cycle management processes internally. This approach allows companies to have direct control over the billing and coding operations, ensuring greater transparency and customization according to their specific needs. In-house revenue cycle management provides organizations with the flexibility to tailor their strategies, workflows, and technology solutions based on their unique requirements, resulting in efficient and streamlined operations.
On the other hand, the fastest-growing component in the market is the outsourced segment. Many healthcare providers are recognizing the benefits of outsourcing revenue cycle management services to specialized third-party vendors. Outsourcing enables organizations to leverage the expertise and resources of external partners who have in-depth knowledge of medical coding, billing, and revenue cycle management. By outsourcing these functions, healthcare providers can focus more on core patient care activities while reducing administrative burdens and costs. Additionally, outsourcing can provide access to advanced technologies and industry best practices, leading to improved efficiency, accuracy, and financial performance. As a result, the outsourced revenue cycle management segment is experiencing rapid growth in the market.
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The US has a highly developed healthcare system and a large market for revenue cycle management solutions. Factors such as increasing healthcare spending, a complex reimbursement landscape, and a strong focus on digitization and technology adoption in healthcare contribute to the dominance of the US market. Furthermore, the presence of major healthcare organizations, advanced infrastructure, and a favorable regulatory environment for revenue cycle management drive market growth in the US.
On the other hand, the fastest-growing region in the market is Mexico. The country is experiencing rapid growth in their healthcare sectors, driven by factors such as increasing healthcare investments, government initiatives to enhance healthcare infrastructure, and the adoption of advanced technologies. The growing awareness of revenue cycle management solutions and the need for efficient healthcare operations are propelling the market's growth in Mexico. Additionally, the implementation of healthcare reforms and the emphasis on improving patient care and financial outcomes are creating opportunities for revenue cycle management providers in Mexico.
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Increasing demand for accurate and standardized medical documentation
Complexity and constant evolution of coding systems and regulations
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The competitive landscape of the U.S. medical coding market is characterized by a diverse range of service providers and software solutions catering to the growing demand for accurate and efficient medical coding processes. Key players in the market offer a variety of services, including medical coding software, outsourcing services, consulting, and training. These providers strive to differentiate themselves by offering advanced technologies, user-friendly interfaces, and comprehensive solutions that address the evolving needs of healthcare organizations. Additionally, partnerships and collaborations with healthcare stakeholders, such as hospitals, clinics, and insurance companies, are common strategies to enhance market presence and expand service offerings. As the market continues to grow, competition intensifies, driving innovation and the development of sophisticated coding solutions to meet the demands of the dynamic healthcare industry.
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SkyQuest’s ABIRAW (Advanced Business Intelligence, Research & Analysis Wing) is our Business Information Services team that Collects, Collates, Co-relates, and Analyses the Data collected by means of Primary Exploratory Research backed by robust Secondary Desk research.
According to our U.S. Medical Coding Market analysis, medical coding plays a crucial role in the healthcare industry, ensuring accurate billing, reimbursement, and efficient medical documentation. The market is driven by factors such as the increasing adoption of electronic health records, the demand for standardized coding systems, and the growing emphasis on revenue cycle management. Key trends in the market include the adoption of automation and AI technologies to streamline coding processes and enhance accuracy. The market is characterized by a diverse range of service providers and software solutions, offering coding software, outsourcing services, and consulting. As healthcare providers strive to optimize financial processes and reduce administrative costs, the demand for medical coding software and outsourcing services is expected to continue growing. Additionally, the complexity and constant evolution of coding systems pose challenges for coders and healthcare organizations, highlighting the importance of continuous training and staying updated with coding guidelines.
|Market size value in 2021||USD 16.79 billion|
|Market size value in 2030||USD 38.31 billion|
|Forecast Unit (Value)||USD Billion|
|Regions covered||North America (US, Canada), Europe (Germany, France, United Kingdom, Italy, Spain, Rest of Europe), Asia Pacific (China, India, Japan, Rest of Asia-Pacific), Latin America (Brazil, Rest of Latin America), Middle East & Africa (South Africa, GCC Countries, Rest of MEA)|
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For the U.S. Medical Coding Market, our research methodology involved a mixture of primary and secondary data sources. Key steps involved in the research process are listed below:
1. Information Procurement: This stage involved the procurement of Market data or related information via primary and secondary sources. The various secondary sources used included various company websites, annual reports, trade databases, and paid databases such as Hoover's, Bloomberg Business, Factiva, and Avention. Our team did 45 primary interactions Globally which included several stakeholders such as manufacturers, customers, key opinion leaders, etc. Overall, information procurement was one of the most extensive stages in our research process.
2. Information Analysis: This step involved triangulation of data through bottom-up and top-down approaches to estimate and validate the total size and future estimate of the U.S. Medical Coding Market.
3. Report Formulation: The final step entailed the placement of data points in appropriate Market spaces in an attempt to deduce viable conclusions.
4. Validation & Publishing: Validation is the most important step in the process. Validation & re-validation via an intricately designed process helped us finalize data points to be used for final calculations. The final Market estimates and forecasts were then aligned and sent to our panel of industry experts for validation of data. Once the validation was done the report was sent to our Quality Assurance team to ensure adherence to style guides, consistency & design.
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