Sub contracting transcription has numerous benefits the most noticeable being that of conservation on expenditure.  While analyzing expenditure healthcare facilities tend to ignore many key expenses heads hence the comparison between the price per line given by the contracting out vendor and the current costs per line is not correct.

What should be included while calculating expenditure on captive medical transcription?

Direct expenditure

• Direct transcriptionist staff wages: This includes the remuneration paid to captive transcriptionists.
• Expenditure of teaching: The costs of preparation the new team to allow them to perform work as per the health facility's requirements.
• Supplies: The stationery costs and the costs of other supplies used for healthcare transcription would have an impact on the expenditure per line.
• Expenditure of overflow work that is subcontracted: Sometimes when the in-house team is not able to keep up with excess workflow the jobs needs to be subcontracted and this adds to the expenditure.

Indirect costs 

• Depreciation of computers: Over time the equipment used would have some wear and tear, this depreciation expenditure will have to be added to the expenses 
• Apportioning remuneration of management and administrative staff: The salaries of managerial and administrative personnel contributing to the medical document creation procedure will have to be assigned and added accordingly.
• Extra facilities given to employees other than the salary: Benefits given to personnel like health insurance, dental care etc will have to be added in the category of indirect expenditure.
• Taxes: Having staff on rolls would mean taxes would have to be paid.
• Expenditure of real estate used: Apportionment of expenses of real estate expenses would have to be made according to the space usage.
• Expenditure of employee turnover: This would include fees paid to consultants, signing bonuses, costs of preparation new employees and the expenses of advertising for new employees.
• Expenditure of software and tools: The expenditure of technology used for medical transcription and the expenses of integrating this with the hospital's system needs to be added.

Apart from the direct and indirect expenditure of medical transcription captive the other factors that need to considered are:

• No of days taken for delivery of records
• Correctness of transcripts
• Health professional satisfaction
• Data confidentiality
• Transcripts generation and distribution
• Easy availability of trained staff

Given below is a table of typical expenses of medical transcription captive:

Item                                                                 expenses in US $ per annum

Remuneration                                                                      30000

Benefits                                                                                    8000

Real estate                                                                              2000

Furniture                                                                                   1000

Computers                                                                               2000

Management                                                                           5000  

Consumables                                                                          1000

Utilities                                                                                       500

Miscellaneous                                                                          500

Total expenditure                                                                50000

Given below is the productivity of a transcriptionist

Number of line per 8 hour day                                                1250

Work hours per year                                                            1920

Lines per year                                                               300000

Downtime in %                                                                            10%

Actual lines produced in a year                                         270000

Costs per line                                                                        18.5

After calculating the expenses of all these factors one can arrive at the expenditure per line.

The rate offered by a typical medical transcription company is 10 cents per 65-character line. This shows a clear saving in the expenses per line. The 65-character line is calculated according to the billing method principles as per the MTIA guidelines. The billing method used is confirmable, classifiable, assessable, consistent and equitable & open. .

Not only that contracting out the healthcare transcription needs of a health facility to a professional service provider has benefits like:

• Correctness of above 99%
• 24 hours turnaround time, with an alternative of 4-12 hours delivery time for STAT reports.
• Information technology that allows smart upload by allowing flexible means of dictation and features like smart delivery and web delivery for ease of use.
• Makes sure data confidentiality and HITECH compliance by using the right technology and having safety measures in place for security of people and infrastructure.