U.S. Business Process As A Service In Healthcare Payers Market (By Solution Coverage: Traditional BPaaS, Best-of-breed BPaaS; By Buyer Type: Government buyers, Commercial buyers; By Value Chain Processes; By Buyer Size) - Global Industry Analysis, Size, Share, Growth, Trends, Revenue, Regional Outlook and Forecast 2022-2030

The U.S. business process as a service in healthcare payers market was surpassed at USD 5.7 billion in 2021 and is expected to hit around USD 9.71 billion by 2030, growing at a CAGR of 6.1% from 2022 to 2030.

Report Highlights

• Best-of-breed BPaaS is predicted to grow at a CAGR of 9.45% over the forecast period.
• For healthcare payers, in both the segments-end-to-end traditional and best-of-breed model accounts for the majority of the shares and it is anticipated to grow at a CAGR of 5.02%, and 9.45% respectively. 
• Over the forecast period, it is anticipated that government buyers would witness a CAGR of 5.74%. 
• Member management and care management are predicted to grow at CAGRs of 6.92% and 6.04%, respectively, throughout the forecast period.
• Over the forecast period, it is anticipated that Medicare advantage would witness a CAGR of 7.34% during the forecast period.

The fact that BPaaS engagements contributed significantly to healthcare payer business process outsourcing revenue and that this percentage is likely to rise as the industry for payer BPaaS expands due to the move toward value-based care, which has been hastened by COVID-19.

Furthermore, the adoption of BPaaS in the U.S. payviders industry is growing quickly. Although payviders have been around for a while, the Affordable Care Act made them more common and significant, which makes them well-suited to take advantage of the BPaaS opportunity.

In addition, many have not attained considerable scale in terms of members registered, except the majority of large payviders. For instance, according to The Robert Wood Johnson Foundation (RWJF) as of September 2016, just 4 of the 42 Provider Sponsored Health Plans (PSHPs) established since 2010 had between 50,000 and 100,000 covered subscribers, with the remaining 36 having fewer than 50,000. These obstacles could well be solved since BPaaS solutions scale more quickly for the provider and are easier to install without a long lag time.

Additionally, industry-specific regulatory compliances specify a range of compliance requirements for various industrial verticals. The Health Insurance Portability and Accountability Act (HIPAA), the Health Information Technology for Economic and Clinical Health (HITECH), and the Payment Card Industry Data Security Standard (PCI DSS) are a few legislations that have impacted the industry. In many instances, the market now supports compliance management as an administrative activity rather than a regulatory one. A BPaaS provider could implement BPaaS solutions that can bridge compliance gaps between verticals and adapt to changes in the existing regulations, leading to the industry’s growth with the rise in adoption throughout the forecast period—as all compliance adherence difficulties can be managed with their assistance.

Scope of The Report

Solution Coverage Insights

Best-of-breed solutions are catching up as a result of increased commercial SaaS use, even though traditional BPaaS solutions have gained more momentum among businesses. Best-of-breed BPaaS is predicted to grow at a CAGR of 9.45% over the forecast period.

Best-of-breed BPaaS models would be made possible by factors including expanding the availability of a BPS partner ecosystem for technological platforms and advancements in data security and compliance standards. The BPS horizontals, such as HRO, where third-party solutions like workday and success factors are mature and have a high adoption rate, are where this tendency is particularly pronounced.

Traditional BPaaS and Best-of-breed BPaaS Insights

For healthcare payers, in both the segments-end-to-end traditional and best-of-breed model accounts for the majority of the shares and it is anticipated to grow at a CAGR of 5.02%, and 9.45% respectively. This is majorly driven by the fact that a single provider offers an end-to-end one-stop BPaaS solution, which acts as the most popular choice among the payers. are catching up as a result of increased commercial SaaS use, even though traditional BPaaS solutions have gained more momentum among businesses. Best-of-breed BPaaS is predicted to grow at a CAGR of 9.454% in the forecast period.

Buyer Type Insights

Over the forecast period, it is anticipated that government buyers would witness a CAGR of 5.74%. Government plans have historically been the main buyer sector for BPaaS due to the modular implementations of Medicaid Management Information Systems (MMIS). U.S. states have entrusted service providers with the design, development, and implementation of MMIS platforms as well as the use and maintenance of such platforms. As CMS advances the modularity agenda, more states are modernizing their outdated monolithic systems and progressively moving to the as-a-service paradigm.

These states frequently make use of BPaaS products from service providers (third-party liability) for administrative modules such as claims processing, provider management, and financial support services (third-party liability). According to an article published by the Everest group in 2021, states like Wyoming and Montana have begun to use the BPaaS idea for critical medical processes, including care management.

Value Chain Processes And Buyer Size Insights

By value chain processes, BPaaS has seen early adoption among administrative procedures, with the following significant cases:

A)   A significant US health plan has agreed to a contract with a BPS service provider in the healthcare industry to use the latter's BPaaS solution for the full range of claims administration, from claims processing and validation to payments and adjudication.

B)   A midsized health plan uses BPaaS to streamline its encounter and claims processing.

C)   One of the biggest Blues plans used BPaaS to boost the number of people enrolled in Medicare Advantage. It used BPaaS to comply with CMS regulations and raise the STAR ratings of its MA plan.

The most important point to take away from these use cases is that while BPaaS adoption is increasing across administrative processes, most payers have not fully realized the benefits of BPaaS by integrating it throughout the value chain.

Payers are not implementing BPaaS across the entire spectrum of activities, not even for administrative processes that use it. For instance, BPaaS deployment and process optimization across the value chain, including member engagement, risk adjustment, and STAR rating assistance, would be required to achieve larger enrollment in MA plans.

Based on industry understanding, it is projected that BPaas adoption will lead to a dominance among Small to Midsize buyers, holding more than 70% of the revenue share during the forecast period. Additionally, member management and care management are predicted to grow at CAGRs of 6.92% and 6.04%, respectively, throughout the forecast period, and will be the processes that generate the majority of this revenue in terms of the value chain.

Commercial Buyers Insights

While government buyers account for a majority of the healthcare payer BPaaS market, the BPaaS adoption is driven by regulatory push or the CMS mandate and not the states’ intent to achieve operational and technological efficiencies. In contrast, the commercial payer segment is rapidly adopting the BPaaS approach. Over the forecast period, it is anticipated that Medicare advantage would witness a CAGR of 7.34% during the forecast period.

Following COVID-19, the already increasing MA and Managed Medicaid enrollment received an additional boost. According to a survey by Medicare Advantage Plans, 45% of Medicare recipients transfer from an original Medicare plan to an MA plan in 2021. Additionally, the 21^st Century Cures Act is anticipated to result in a significant increase in ESRD patients in MA plans.

Moreover, from March 2020 through December 2020, Managed Medicaid membership rose to 15.2%, maintaining the trend of rising Medicaid participation, according to a 2021 article from Accenture. Additionally, it is estimated that during the projected time, BPaaS use will increase at a 6.8% rate in managed Medicaid.

Key Players

• Accenture
• Cognizant
• HCL
• IBM
• Infosys
• NTT DATA
• Optum
• TCS
• UST
• Wipro
• EXL
• Softheon
• Genpact
• Change Healthcare
• Firstsource
• Celegence

Market Segmentation

• By Solution Coverage Outlook
• Traditional BPaaS

• End-to-end traditional BPaaS
• Process-specific traditional BPaaS
• Best-of-breed BPaaS
• End-to-end best-of-breed BPaaS
• Process-specific best-of-breed BPaaS
• By Buyer type Outlook
• Government buyers
• Commercial buyers
• Medicare Advantage
• Managed Medicaid
• Individual health plan
• Employer-sponsored health plan
• By Value Chain Processes Outlook
• Claims Management
• Member Engagement
• Care Management
• Others (Product development, Network Management, Risk & Compliance)
• By Buyer Size
• Small buyers
• Midsized buyers
• Large buyers