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Why the Government is Outsourcing (and You Should, Too)


The data is clear – policymakers are making every effort to reduce healthcare costs, particularly as states struggle with significant budget deficits across the country. To do this, many state governments have elected to outsource the management of Medicaid and Medicare programs to managed care companies. According to Modern Healthcare, 34% of Medicare beneficiaries are now enrolled in a Medicare Advantage plan, which is administered by a private payer. Similarly, 77% of Medicaid beneficiaries are enrolled in some form of managed care plan.

Why would government choose to go the managed care route? Their reasons for outsourcing are similar to the many reasons more and more healthcare organizations are outsourcing support functions such as revenue cycle management, accounts receivable, clinical documentation improvement functions and more. If you haven’t stopped to consider the many benefits that come with outsourcing functions that fall outside of your core business, here are the top 3 reasons we think many state governments are making this important choice.

They’re Leaving Complexities to the Experts. Let’s face it, healthcare is no simple business. And state government has a LOT to do. Rather than keep up with a rapidly changing industry, outsourcing can help states offload expenses, reduce risk and shift the intense amount of effort it takes to keep up with the dynamic world of healthcare.

Customers (Residents) Reap the Benefits. In the case of both Medicaid Managed Care and Medicare Advantage plans, managed care payers are competing with one another for patients and are therefore offering additional services to lure customers to choose their plan. With competition and in this case, the consumer wins with added benefits. Much like companies who want happy customers, government wants happy residents. Outsourcing provides a win/win scenario.

Budget Predictability is Key. Outsourcing helps organizations – even our state government – better predict and manage expenses, which is critical when constituents are watching your budget. By partnering with managed care companies for Medicaid and Medicare, risks are mitigated through a more fixed fee structure. Similarly, healthcare organizations that outsource support functions can often reduce costs, while also having more control over recurring costs associated with outsourced functions.

Not convinced yet? The experts at GeBBS healthcare can provide a wide variety of outsourced revenue cycle management, accounts receivable and health information management services. Ranked in Modern Healthcare’s Top 15 Largest RCM Firms, Black Book Market Research’s Top 20 RCM Outsourcing Services, and Inc. 5000’s fastest growing private companies in the U.S, GeBBS has the healthcare expertise to help your healthcare organization thrive through outsourcing.

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