Saturday, May 31, 2008

Q. How does the Internet improve the control, scope and efficiency of outsourcing services?

A. Many providers choose to handle all of their business functions internally, but as market dynamics change, an increasing number are outsourcing services. However, traditional outsourcing has a tarnished image with some providers. For instance, providers who outsource billing to a billing services company bear the inefficient burden of faxing information back and forth, and receiving little or no access to the status of their receivables. And because the billing services company owns the system and data, many providers have felt like a hostage when trying to bring billing in-house or change to another billing services company.

When you introduce the Internet into the equation, outsourcing becomes insourcing. Internet-based solutions allow providers to manage internal and outsourced business functions from within a business management solution they control and administer. The Internet allows providers to bring functions in-house. For instance, using the billing example again, a provider using an Internet-hosted solution can internally manage order intake and inventory management while simultaneously granting day-to-day access to a billing services company to manage the billing and accounts receivable functions. This eliminates the need to fax or re-key data because everyone is working seamlessly on one system, which the provider controls.

Insourcing is not limited to billing solutions. An Internet-based business management platform becomes a gateway to many compelling insource opportunities, allowing providers to use and collaborate with other product and service vendors in order to maximize their efficiency and margins. Examples include the insourcing of patient billing, eFaxing, ePurchasing, document imaging, and electronic claims data exchange.

Outsourcing yesterday’s way can be painful. But when it’s done in conjunction with the Internet and today’s powerful software tools, it’s efficient and can be the difference between profit and loss. In this Internet age, outsourcing is out. Insourcing is in.

Gary Long is COO of Brightree in Duluth, Ga. He can be reached at <a href="