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Home ➤ Life Science ➤ Healthcare IT ➤ U.S Medical Coding Market
U.S Medical Coding Market by Classification System (ICD, HSPCS, CPD), By
Component (In-House and Outsourced), By Medical Specialty (Oncology,
Anesthesia, Cardiology, Pathology, and Others), and By Companies - Industry
Segment Outlook, Market Assessment, Competition Scenario, Trends and Forecast
2023-2032
Published date: June 2024
Overview
Report ID: 105997
Table of Contents
Number of Pages: 384
Format:
Major Market Players
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Report Overview
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U.S. Medical Coding Market size is expected to be worth around USD 44 Billion by 2032 from
USD 20.3 Billion in 2023, growing at a CAGR of 9.4 % during the forecast period from 2023 to
2032.
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Medical errors, fraud, and delusion of medical documents can lead to considerable financial
losses, which in turn can lead to a lack of effective revenue cycle management and medical
billings. Consequently, a growing demand for revenue cycle management software and
services, including medical coding software, is anticipated.
The market is further supported by the increased endorsement of digital technologies, such as
Electronic Health Records (EHR), mHealth Applications, telehealth, revenue cycle management
software and the growing trend of digitization of healthcare in the U.S. According to the
Centers for Disease Control and Prevention (CDC), in 2021, over 88% of the physicians’ offices in
the U.S used EHRs. The utilization of medical coding is increasing in the revenue cycle
management process.
In addition, new revisions are added to the codes to make them more flexible and scalable.
The latest version of the code, ICD 11, was launched in January 2022. This includes several new
Report ID
105997
Published Date
June 2024
Rating
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chapters and acts as a support for electronic health records (EHRs). The ICD 11 has about
55000 codes to classify disorders, diseases and injuries, as well as deaths. WHO introduced the
new version of ICD 10 between April to September 2020.
Trusted by more than 17382
organizations globally
Key Takeaways
The U.S. Medical Coding Market is expected to reach a valuation of USD 44 Billion by 2032.
The market is growing at a CAGR of 9.4% from 2023 to 2032.
In 2022, the market size was USD 18.6 Billion.
Over 88% of physicians in the U.S. used Electronic Health Records (EHRs) in their offices in
2021.
The latest version of the ICD 11 code has around 55,000 codes.
The Bureau of Labor Statistics predicts a 7% increase in employment for medical records
from 2021 to 2031.
The ICD segment had the largest revenue share of 65% in 2022.
The outsourced segment accounted for the largest revenue share of 70% in 2022.
By Medical Specialty, the other services segment accounted for the highest revenue
share of 49% in 2022.
In the U.S., the other services segment in the medical specialty insight held a 49% market
share in 2022.
The ICD segment dominated the market with 65% revenue in 2022.
The outsourced segment in 2022 accounted for 70% of revenue with a CAGR of 8.4%.
The introduction and revision of codes have a positive impact on the market growth of
medical records and health information employees. As per the Bureau of Labor Statistics,
Office of Occupational Statistics and Employment Projections, employment for medical
records is expected to rise by 7% from 2021 to 2031. This number is the fastest growing among
all occupations. Medical coding is one of the most popular occupations in the U.S. Due to the
rising demand for universal language in medical documentation, the demand for medical
coders is receiving a positive response.
Classification System Analysis
ICD Segment accounted for the largest revenue share in 2022
The ICD segment dominated the market with 65% revenue share in 2022 as there is an
increase in the usage of these codes among the coders. ICD 11, which entered into force on 1st
January 2022, is precise and flexible. Health information can be used for multiple purposes
such as improving patient outcomes, quality analysis, strategic planning, population health
reporting, safety, integrated care and delivering healthcare services. The coding tool can be
submerged in local digital records and IT systems. This increases user compliance and
reduces cost & training time.
With multiple ICD codes and revisions to suit the fast-changing healthcare industry, CPT is
expected to be the fastest-growing segment in the forecast period. CPT codes, also known as
HCPCS codes, are used for describing tests, surgeries, and other procedures for medical billing.
The government monitors the CPT codes to measure disease prevalence and health
expenditure.
Component Analysis
The outsourced Segment of the U.S medical coding market held the largest revenue share at
70% in 2022.
In 2022, the outsourced segment had the largest revenue share of 70%. It is expected to grow
at a CAGR of 8.4% over the forecast period. Outsourcing of medical coding requirements is
becoming popular among healthcare providers to a great extent. This is due to the fact that
outsourcing helps in reducing administrative costs, saving time, and improving workflow. By
outsourcing medical coding, healthcare providers are able to focus on delivering high-quality
patient care and increasing patient engagement. The increasing trend of outsourcing revenue
cycle management, as well as medical coding, is also having a positive impact on the market
growth.
The in-house segment is projected to be the fastest-growing segment over the forecast
period. Healthcare providers are capable of regulating their entire operations through the
utilization of in-house codes, medical billing and coding, as well as revenue cycle
management. Furthermore, in-house coders are readily available in case of coding errors.
Medical Specialty Analysis
Other Services Segment Dominated the U.S Market in 2022
In 2022, the other services segment dominated the US market with 49% market share. Medical
coding services are in high demand across the majority of specialties due to an increase in
insurance coverage for a variety of diseases. Other Services include medical specialties such
as obstetrics, gynecology, nephrology and many more. This makes other services the
dominant segment among all the other medical specialties. Owing to rising prevalence of
cardiac disorders and complicated procedures which require well-trained coders, the
cardiology segment is likely to demonstrate the fastest growth.
Key Market Segments
By Classification System
ICD
HSPCS
CPD
By Component
In-House
Outsourced
On-shore
Off-shore
By Medical Specialty
Emergency Services
Oncology
Anesthesia
Cardiology
Pathology
Radiology
Other services
Drivers
Rising Demand for Standardized Medical Documentation
The growing demand for standardized medical documentation drives the US medical coding
market. The healthcare industry depends on medical coding to make sure there is proper
billing, reimbursement and communication between healthcare providers and payers.
Medical coding services and solutions are in high demand as the importance of EHRs is
growing and healthcare processes need to be streamlined.
The development of EHR software is driving market growth
EHRs are becoming widely popular in recent times. EHRs for medical coding and billing are
reinforcing the market growth. The market players’ are focusing upon integrating voice
recognition with EHRs to boost the market growth. EHRs play a major role in medical coding
market as medical coders and billers are relying on them. They help the medical coders in
working efficiently by cutting down the need for paperwork and by reducing the errors that
occur in data entry.
Restraints
High Costs Affiliated with EHRs
High costs affiliated with EHRs tampers the growth of market. EHR costs currently range from
0$ upfront to potentially 10000$ and everything in between. The system requires on-time
maintenance and updating which creates difficulty many a times. Also the maintenance cost
of EHRs service is very high. Furthermore, as the demand for EHRs is rising across the globe for
medical coding services, factors related to the cost of EHRs can hinder the growth of the
market in the upcoming years.
Complexity and Continuous Evolution of Coding Systems and Regulations.
The continuous evolution of coding systems and regulations is one of the restraints of U.S
medical coding market. Various coding systems such as the International Classification of
Diseases (ICD) and Current Procedural Terminology (CPT) are involved in medical coding.
These coding systems require extensive training. Furthermore, they undergo regular updates
and revisions, and staying updated with the latest coding guidelines becomes a big challenge
for the coders.
Opportunity
Increasing Technological Advancements
Rapid technological development offers many opportunities for market expansion. The
integration of artificial intelligence (AI) into electronic health record software (EHRs) creates a
positive outlook for the medical coding market. The development of EHR software contributes
significantly to the growth of the medical coding market.
The rapid development of healthcare software technology is accelerating the overall growth
of medical coding market, as healthcare organizations are using AI-powered tools and
advanced medical coding software in order to increase productivity and streamline the
coding process. Governments and private organizations are taking the initiative and investing
heavily into them.
Trends
Growing demand for more simplified and convenient coding and billing solutions for
hospitals.
There is currently a growing demand for more simplified and convenient coding and billing
solutions for hospitals. Along with the growing demand for a universal language to reduce
fraud and insurance, the fraudulent claim is one of the factors driving the market. Furthermore,
there is an increase in the utilization of medical coding for uniform documentation of medical
facilities in the country. Along with this, the growing healthcare industry and technological
advancements across the country are fueling the growth of the market. Apart from this, the
rising demand for ICD is also positively influencing the market.
Additionally, the growing need for medical coding to create accurate patient records and
expedite payments to physicians offers lucrative growth opportunities for industry investors
and end users. Furthermore, major market players are investing heavily in R&D and offering
next-generation coding and replacement solutions, which are expected to increase their
overall sales and profitability in the coming years.
Key Players Analysis
Strong Focus on Product Portfolio Expansion through Various Strategies Maintain the
Dominance of Industry Leaders.
Key players in this market are adopting various strategies such as partnerships, mergers,
acquisitions and investments in expanding their product portfolio, etc. Along with this, key
stakeholders in the U.S are adopting the strategy of announcing new products and services to
the market in order to enlarge their existence in the U.S.
Market Key Players
Due to the presence of several major players across the country, the US medical coding
market is fragmented. New key players will face strong competition from major market
players, especially those with strong brand awareness and large distribution networks.
Moreover, companies have adopted various expansion strategies, partnerships, and the
development of new research methods in order to secure a leading position in the market.
The following are some of the major players in the industry
StarTek
Oracle
Maxim Healthcare Services
Parexel International Corporation
Aviacode Inc.
Verisk Analytics, Inc.
Medical Record Associates, LLC.
Optum
Dolbey System Inc.
Recent Development
StarTek: In March 2024, StarTek acquired a leading healthcare BPO firm to enhance its
medical coding and billing capabilities. This strategic move aims to expand its service
portfolio and strengthen its market position.
Oracle: In April 2024, Oracle launched a new AI-driven medical coding solution designed
to improve accuracy and efficiency in healthcare documentation. This innovation
leverages advanced machine learning algorithms to streamline coding processes.
Maxim Healthcare Services: In May 2024, Maxim Healthcare Services announced a
merger with a prominent health information management company. The merger aims to
integrate their services, offering comprehensive medical coding and healthcare staffing
solutions.
Parexel International Corporation: In February 2024, Parexel International Corporation
acquired a specialized medical coding firm to bolster its clinical trial data management
services. This acquisition is expected to enhance Parexel’s data accuracy and regulatory
compliance.
Verisk Analytics, Inc.: In March 2024, Verisk Analytics, Inc. completed a merger with a
data analytics company focusing on healthcare. This merger aims to enhance Verisk’s
capabilities in providing comprehensive data-driven insights for medical coding and
reimbursement.
Medical Record Associates, LLC.: In April 2024, Medical Record Associates, LLC. acquired a
regional coding service provider to expand its geographic reach and client base. The
acquisition supports its growth strategy and enhances service offerings in medical
coding.
Report Scope
Report Features
Description
Market Value (2023)
USD 18.6 Billion
Forecast Revenue
USD 44 Billion
(2032)
CAGR (2023-2032)
9.4%
Base Year for Estimation
2022
Historic Period
2016-2021
Forecast Period
2023-2032
Report Coverage
Revenue Forecast, Market Dynamics, Competitive Landscape, Recent
Developments
Segments Covered
By Classification System (ICD, HSPCS, CPD), By Component (In-House
and Outsourced), By Medical Specialty (Oncology, Anesthesia,
Cardiology, Pathology, Radiology, Emergency Services and Others), By
Companies – Industry Segment Outlook, Market Assessment,
Competition Scenario, Trends and Forecast 2023-2032
Competitive Landscape
StarTek, Oracle, Maxim Healthcare Services, Parexel International
Corporation, Aviacode Inc., Verisk Analytics, Inc., Medical Record
Associates, LLC., Materion, Optum, Exela Technologies, Dolbey System
Inc., Other Key Players
Customization Scope
Customization for segments, region/country-level will be provided.
Moreover, additional customization can be done based on the
requirements.
Purchase Options
We have three licenses to opt for: Single User License, Multi-User
License (Up to 5 Users), Corporate Use License (Unlimited User and
Printable PDF)
Frequently Asked Questions (FAQ)
What is Medical Coding?
Medical coding is the process of translating healthcare procedures and diagnoses
into universally recognized codes for billing, insurance claims, and data analysis.
How big is the U.S Medical Coding Market?
The U.S Medical Coding Market size was estimated at USD 18.6 billion in 2022 and is
expected to reach USD 44 billion in 2032.
What is the U.S Medical Coding Market growth?
The U.S Medical Coding Market is expected to grow at a compound annual growth
rate of 9.4%. From 2023 To 2032
Who are the key companies/players in the U.S Medical Coding Market?
Some of the key players in the U.S Medical Coding Markets are StarTek, Oracle, Maxim
Healthcare Services, Parexel International Corporation, Aviacode Inc., Verisk Analytics,
Inc., Medical Record Associates, LLC., Optum, Dolbey System Inc.
What are the Key Coding Systems Used in the U.S.?
The primary coding systems in the U.S. are ICD-10-CM for diagnoses, CPT for
procedures, and HCPCS Level II for supplies and services.
Why is Medical Coding Important?
Medical coding ensures accurate billing, reimbursement, and healthcare data
management, which is crucial for healthcare providers, insurers, and researchers.
What Are the Ethical Considerations in Medical Coding?
Coders must adhere to ethical standards, ensuring patient confidentiality, accuracy,
and compliance with healthcare regulations.
U.S Medical Coding Market
Published date: June 2024
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