Prices will continue rising incrementally due to increased demand for billing services
Los Angeles, CA (PRWEB) June 19, 2014
Billing services has a buyer power score of 4.1, representing an advantageous environment for buyers. The fragmented nature of the market benefits the buyer greatly, because many potential vendors exist that can provide a similar level of service. Additionally, the fee structure, where a vendor is paid by a percentage of the total billings collected, incentivizes the vendor to collect as much of the outstanding payments as it can. “This removes much of the need for a buyer to verify quality of service, because the vendor receives payment equivalent to quality of services rendered, though potential vendors still need to be vetted,” says IBISWorld business research analyst Dale Schmidt. As a result, the price is inelastic with demand, because total revenue for vendors will shift with total demand without providers needing to adjust their rates.
Buyer negotiation power is helped by available substitute services. In the past, billing services were conducted almost entirely in-house. Outsourced billing services proliferated in the early 2000s, but they are not universal. In recent years, business analytics software, especially practice management software for healthcare providers, have provided much of the functionality of an outsourced billing service. “However, billing services vendors offer value through their ability to follow up unpaid bills with rigor, which most in-house departments cannot match,” says Schmidt.
The primary buyers of billing services are healthcare providers. The aging of the US population and the expansion of health insurance following the implementation of the Patient Protection and Affordable Care Act of 2010 will steadily drive up demand for healthcare goods and services. The increased billing load will push billing services providers to increase rates for all buyers slowly over the next three years. For more information, visit IBISWorld’s Billing Services procurement category market research report page.
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IBISWorld Procurement Report Key Topics
This report is intended to help buyers of billing services. These are services that collect invoice information from their buyers and generate bills on their behalf. They also collect the bill payments from the buyer’s clients and pursue the payment of denied or delinquent bills. The collected payments are then transferred back to the buyer. The majority of billing services are for medical services.
Recent Price Trend
Product Life Cycle
Total Cost of Ownership
Supply Chain & Vendors
Supply Chain Dynamics
Supply Chain Risk
Market Share Concentration
Buying Lead Time
Key RFP Elements
Buyer Power Factors
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