Medical Transcription in India and Recession in the USA

Medical Transcription in India and Recession in the USA

The Indian rupee has steadily increased in value vis-à-vis the US dollar over the last five years. The dollar, which was worth almost 48 Indian rupees five years ago, is now worth less than 40. The question is whether this appreciation in the value of the rupee has made outsourcing unattractive for businesses wanting to cut costs.

One of the industries outsourced to India from the USA in order to cut costs is medical transcription. The outsourcing saga was driven by a lot of factors:

• High labor costs in the USA – the average annual wage for a US medical transcriptionist is about $30,000 ( while that of an Indian medical transcriptionist is about one-fourth that amount.

• The unappealing nature of the profession – the average American would find it difficult to manage a family on a medical transcriptionist’s salary.

• An aging workforce – the average American medical transcriptionist is 50-plus years of age while the average Indian medical transcriptionist is around 25 years of age.

• The turnaround time factor – medical transcriptionists working in Indian companies work around the clock in three shifts, and there is no shortage of qualified manpower. A physician can expect to sign his report within a couple of hours of having dictated it.

• The Indian government encouraged companies to start medical transcription services and gave them tax holidays.

• The US government was trying to cut costs on healthcare.

• India had a skilled workforce with the largest English-speaking population in the world.

Fourteen years ago, that record was held by the USA. India’s English-speaking population is more than the total population of the UK and the USA combined. English has a special status in India – in parliament, courts, broadcasting, the media, and schools.

What is the situation today? The dollar is sinking and the rupee is rising. Will outsourcing medical transcription to India still remain a viable cost-effective alternative?

Industry insiders opine that cost is not the only motivating factor for outsourcing, although it might be one of the main factors. A large number of young and energetic potential medical transcriptionists willing to work in shifts round the clock in a US company’s offshore facility would ease training issues for any particular client. The regulated milieu of an offshore center would also help towards achieving high quality benchmarks and turnaround time.

The outsourcing trend continues unabated. While some people state that 20% of all medical transcription work is outsourced, others put the figure as high as 50%. Some companies based in the US even claim to have the work done onshore and surreptitiously outsource their work without admitting it publicly.

Jargon such as narrowing exchange rates may sound confusing, but ultimately, the sinking dollar combined with the rising rupee may possibly mean higher wage bills and lesser profits for companies that are outsourcing jobs to India. While the appreciation of the rupee can affect business operations in India, companies can still be competitive because India has developed a very strong medical transcription industry during the last ten years or so. In the present scenario, we have Indian companies transcribing even for British and Australian hospitals.

For bigger players in the medical transcription industry, these currency exchange fluctuations do not matter. They have found their talent pools and nurtured them. These companies encourage their brightest medical transcriptionists to take the CMT examination from the Thomson Prometric centers available near their centers and reimburse the fees. New research and development initiatives are constantly being undertaken in these companies. These bigger players are also discovering that the Indian work ethic is far superior to the American one.

The labor situation in the US is also a cause for alarm. While the American medical transcription industry’s workload is increasing annually, manpower is also decreasing annually, raising questions about who will make up for the shortfall. In the 1980s, medical transcription was an attractive proposition and prospective employers received many job applications, but today the situation is different because many Americans think that medical transcription is not an attractive proposition anymore. This worries a lot of companies that have not outsourced their work so far.

Recognizing the shortage of medical transcriptionists nationwide, the Department of Labor declared medical transcription as an apprenticeable profession as a prelude to establishing a national apprenticeship program. The Medical Transcription Industry Association and the Association for Healthcare Documentation Integrity applied for apprenticeability determination for qualifying graduates of selected medical transcription training programs, and it is learned that the US Department of Labor (DOL) approved this application (

Although it is hoped that many will participate in these programs, the lack of American talent may lead to a Catch-22 situation for most companies who do not prefer outsourcing medical transcription to India or other countries.

Most large medical transcription companies who use overseas workers also offer US-based transcription because a number of healthcare providers still prefer working with American transcriptionists. This may be due to a misconception that American medical transcriptionists are better than Indian ones, but most well-established vendors in India have now proved that Indian medical transcriptionists are as good as if not better than their American counterparts, especially when handling dictators who are not native English speakers.

Larger transcription providers are making the outsourcing story work, the rise of the rupee notwithstanding. For example, large companies have proved that they can hold their own and yet be profitably managed while maintaining the highest quality standards. No client would outsource to India just to save a few dollars if the quality were to be bad.

As clients expect faster turnaround times, excellent quality, and reduced overheads, the scenario of the future may well be an amalgam of onshore and offshore medical transcription, especially with the labor shortage in the US.

Last but not least, HIPAA regulations would be better served by outsourcing medical transcription. A medical transcriptionist in a foreign country would not be curious about who a patient is or what his or her condition is. The patient would be just another faceless person; the job to be done would be just another file to be transcribed. Confidentiality of the medical record would be automatically assured. Somebody named Venkatanarasimhalakshmiraju, for instance, who transcribes a medical report in Hyderabad would not care or be bothered about a Jane Doe’s pregnancy or a John Doe’s prostate.

An unknown person in one corner of the world transcribing your medical records as a matter of routine would be better at protecting your privacy than somebody in the neighborhood inquisitive about why you appear sick and haven’t turned up for work.