The Increasing Global Market For Health Care: The Effect Of Emerging Technologies On Global Outsourcing & Offshoring Of Health Care Services

Abstract

The use of outsourcing as a business management tool has a long history in the delivery of health and human services in the United States. But, the current price-pressured, highly-competitive U.S. health and human service market is also experiencing new competitive developments due to the introduction of new technologies and further use of lower-cost labor markets outside of the United States, commonly referred to as offshoring. This paper will explore the evolution of outsourcing and offshoring in health and human services and provide a model to analyze the technological factors that will likely contribute to a global transformation of the health and human services. Traditional thinking is that offshoring is usually limited to highly-repetitive, low-skill service tasks such as data entry and call center management. But, new research on the concept of offshoring posits that services that are labor intensive, information-based, codifiable, and/or highly transparent are candidates for technology-enabled outsourcing. A broader shift in labor models, from local to global, is likely to occur. Since these four characteristics apply to many of the professional functions in the health and human service field, it is imperative that health care executives understand the potential risks and opportunities of these emerging technologies. In particular, the authors will review the likely health service functions that will be subject to worker/labor competition through global outsourcing and suggest possible strategies for organizations in the field to address these new competitive threats.