U.S. Medical Coding Market Size, Share, Growth Analysis, By Classification system(ICD, HCPS and CPT), By Component(In-house and outsourced) - Industry Forecast 2024-2031

U.S. Medical Coding Market size was valued at USD 18.4 billion in 2022 and is poised to grow from USD 20.17 billion in 2023 to USD 41.99 billion by 2031, growing at a CAGR of 9.6% during the forecast period (2024-2031).

In the near future, the Medical Coding Market in the United States is expected to experience substantial expansion. Errors in billing, insurance fraud, and misreading medical records can result in significant financial losses. The need for revenue cycle management solutions, such as medical coding software and services, has increased due to the rising incidence of inefficient medical billing and revenue cycle management. It is anticipated that this rise in demand would spur market expansion. The market is expanding favorably because to the adoption of digital technologies like telehealth, mhealth applications, revenue cycle management software, electronic health records, and ongoing initiatives to digitalize healthcare in the United States. The process of revenue cycle management is using medical coding more and more, and new code revisions have been used to improve scalability and flexibility. The industry is expanding favorably as a result of the new ICD-11 coding system's deployment in January 2022, which includes support for electronic health data and several new chapters. About 55,000 codes are included in this updated coding system to categorize illnesses, injuries, fatalities, and disorders. The Office of Occupational Statistics and Employment Projections of the Bureau of Labor Statistics projects that between 2021 and 2031, the number of workers handling medical records and health information will increase by 7%. Because there is a growing need for standardized medical documentation, certified medical coders are in great demand in the United States. The increased burden of medical coding on medical staff and clinicians has resulted in the implementation of many automated systems. For example, according to an Athenahealth survey, doctors labor overtime on coding for an average of ninety minutes each day. As a result, more people are using computer-assisted coding systems, which provide quick, accurate, and effective medical coding. Computer-assisted coding can boost productivity by 11-30%, per a 3M survey. Furthermore, it is anticipated that the advancement of AI-enabled medical coding will propel market expansion. The United States is rapidly becoming a more health-conscious nation, and hospital management expenditures are particularly high. Consequently, there is growing demand on healthcare organizations to provide high-quality care at a lower cost. In order to reduce administrative expenses and improve return on investment, healthcare organizations are embracing medical coding software and outsourcing services in response to this challenge. It is projected that this adoption will propel the market's expansion.

Top-down and bottom-up approaches were used to estimate and validate the size of the U.S. Medical Coding Market and to estimate the size of various other dependent submarkets. The research methodology used to estimate the market size includes the following details: The key players in the market were identified through secondary research, and their market shares in the respective regions were determined through primary and secondary research. This entire procedure includes the study of the annual and financial reports of the top market players and extensive interviews for key insights from industry leaders such as CEOs, VPs, directors, and marketing executives. All percentage shares split, and breakdowns were determined using secondary sources and verified through Primary sources. All possible parameters that affect the markets covered in this research study have been accounted for, viewed in extensive detail, verified through primary research, and analyzed to get the final quantitative and qualitative data.

U.S. Medical Coding Market Segmental Analysis

Segmentation of the US medical coding market is based on location, component, and categorization system. The market can be divided into ICD, HCPS, and CPT segments based on the classification system. The market is divided into two segments based on the component: in-house and outsourced. The market is divided into the US, Canada, Mexico, and the remainder of North America based on region.

Drivers of the U.S. Medical Coding Market

The growing need for precise and consistent medical documentation is a major factor propelling the U.S. medical coding market. Medical coding is essential to the healthcare sector as it facilitates accurate billing, payment, and communication between payers and healthcare providers. Medical coding services and solutions are in high demand due to the growing emphasis on electronic health data and the need for streamlined healthcare procedures.

Restraints in the U.S. Medical Coding Market

The intricacy and ongoing change of codes and laws is a major impediment to the U.S. medical coding sector. Medical coding necessitates the use of numerous coding systems, including CPT (Current Procedural Terminology) and ICD (International Classification of Diseases), which demand substantial knowledge and experience. Furthermore, these coding systems are subject to frequent modifications and revisions, which makes it difficult for coders to remain current and adhere to the most recent coding standards. The intricacy and fluidity of medical coding may hinder market expansion and present difficulties for coders and healthcare organizations.

Market Trends of the U.S. Medical Coding Market

An important development in the U.S. medical coding market is the growing use of artificial intelligence (AI) and automation technologies. Advanced coding software and AI-powered solutions are being used by healthcare organizations to increase productivity, improve accuracy, and streamline the coding process. Automation tools, including computer-assisted coding (CAC), are being used extensively to help coders quickly and accurately assign the right codes to diagnoses and medical procedures. In order to minimize manual labor and potential errors, AI algorithms are being utilized to evaluate medical data, extract pertinent information, and recommend appropriate codes. The demand for quicker and more accurate coding procedures, more productivity, and better revenue cycle management in the healthcare sector are the main drivers of this movement.