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Outsourcing Hospitals

You are the president of a multi hospital system that is growing at a rapid pace. There are strains on resources, and pressures to find new ways to achieve an economic scale in operations. In a meeting with the staff, a suggestion was made to look overseas for two services the system normally did internally.

The first was to consider outsourcing the reading of radiological images to an India-based radiology company. They would have radiologists available 24/7, and the images can be sent to them digitally. There would be a 50% savings and would eliminate the need an on-call radiologist in the hospital. It would also call for a reduction in staff and a reduction in supply acquisition.

The second suggestion was to outsource medical records transcription to a Pakistani company. Voice transcriptions could be sent digitally in real time (as notes were dictated), at a cost of nine cents per line versus the current 22 cents per line that the hospital is paying with a local transcription company. The turnaround time was comparable. The negative aspect is that sometimes language differences could cause errors in transcribing. In addition, the decision to take business away from local companies would impact the local economy

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In this situation it is quite obvious that the first suggestion would be the most advantageous alternative by which to be able to achieve an economic scale and operations. This is due to the fact that this first alternative offers 24/7 availability of radiologists, which makes it possible for radiological images to be read expeditiously, which in turn means that the hospital system will be able to analyze the results of these readings and ascertain their patients health conditions in a more expeditious manner. This would serve to increase the probability of an accurate and early diagnosis, and thereby improve the patient's chance of obtaining ...