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MEDICAL TRANSCRIPTION: Not in the Pink of Health

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DQI Bureau
New Update

The golden goose of IT-enabled services, medical transcription, is having a

tough time living up to its name. The quality-oriented and human

resource-intensive business is not churning out bucks as fast as small operators

thought it would. Inability to consistently perform up to the high standards

demanded by transcription service providers and hospitals in the US, added to

the presence of intermediaries like consultants and associates between clients

and customers, is proving to be the bane of the industry in India.

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"Quality is a key factor in the medical transcription industry, and

Indians, as a society, are not generally quality-conscious. Transcribers do not

transcribe with the 98.7% accuracy demanded by the American Association of

Medical Transcription the first time around. The content then has to be taken up

to the desired level by quality sub-editors and editors, who are in short

supply," says AS Ravi Venkatesh, CEO, Computer Higher Education and

Software Solution (Chess).

Shaper Info Global, which is into providing solutions in high technology

areas, forayed into the field of medical transcription in 1999, only to pull out

after six months. The reason? Returns were not commensurate with the efforts put

in. "Lack of qualified transcribers and the high mobility rate of the

qualified few were affecting our output, which in turn could have affected our

reputation. This would have automatically disqualified us even if we had not

pulled out," admits Nagaraj Sharma, managing director, Shaper.

K Shanmugam, head, training division, Zentech Solutions, which recently

kicked off production, however, differs. "Quality, of course, is the

deciding factor. But it is also a fact that the Indian medical transcription

industry is not fit for small players. Small companies either have to cough up

huge investments to compete with big players, which they cannot, or depend on

intermediaries for contracts. When intermediaries come into play, the margin of

profits for companies doing sub-contracting gets drastically reduced. As a

majority of smaller companies are doing just that, the applecart is upset. There

are much too many small players in this highly unorganized industry."

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Worldwide, small and medium companies account for about 80% of the

$3.3-billion business outsourced from the $6.6-billion MT industry in the US. In

India, however, with business not being too hot, many companies are on the

lookout for alternative revenue sources. Nittany, one of the pioneers in the

southern region, is said to have jumped ship and is focusing more on medical

billing. Rapid Care is planning to include the entire gamut of healthcare

management such as insurance claims, billing and data management to make its

business more viable.

Contrast these with the story of the Coimbatore-based KG Information Systems,

which has grown from a buyer-supplier partner of Heartland Infosystems Services

with 27 people in 1998 to become the joint venture partner of Heartland now,

with about 220 systems and 1,200 transcribers. "It is a large volume

business where there is no space for small companies which do not have a

long-term plan. Moreover, lack of qualified transcribers in the industry due to

inadequate training institutes has marred the prospects of small companies

without in-house training facilities," says Vinay Kumar, training manager,

KG Info. The company plans to add 100 more systems personnel and another 1,000

other specialists by the end of next year to its ranks.

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"MT is a good industry to make money provided the company has a good

training system to produce quality transcribers and a proper HR policy to arrest

the mobility of its employees in place, in addition to direct clients in the

US," adds Sharma. However, having US-based clients has not helped CHESS,

which is a franchisee of US-based TSP, CBay. Though it has a production capacity

of 30,000 lines per day with more than 60 systems at its disposal, it produces

only 6,000—7,000 lines per day. "The fault lies with Cbay’s marketing

strategy. There is enough work for everyone, but there is an urgent need to

market ourselves aggressively. To this end, we plan to set up our marketing

offices in the US and Canada" says Ravi Venkatesh about the situation.

"Things are not all that bleak. Revenues have crept up to Rs 16 crore

this fiscal, up from Rs 12 crore in 1999—00 and Rs 10 crore in 1998—99. But

certainly, dropouts among the 45 companies registered with us have also

increased due to problems with consultants and associates," says

Rajalakshmi, director, Software Technology Parks of India, Chennai.

"That augurs well for the industry. This shakeout would weed out

non-serious players, leaving only committed companies in the fray," says ML

Venkat Laxman, managing director, Rapid Care.

Nevertheless, the industry is slowly moving towards some set targets.

Recently, iQ Infotech, one of the biggies in the industry, announced plans to

set up production centers in India. With that as the yardstick, Nasscom’s

projection of MT revenues of Rs 4,000 crore in 2008 seems achievable, but the

industry certainly seems to be taking the long route to get to that target.

PRIYA MATHEW



Cyber News Service, Chennai

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