According to House Deputy Majority Leader and Pasig Rep. Roman Romulo, the Philippine BPO industry is expected to gain from the U.S. Patient Protection and Affordable Care Act or “Obamacare” as the increased demand for service will pave the way for the opening of more outsourcing firms in the country.
The new US law aims to enable an additional 30 million Americans to obtain health insurance, requiring U.S. health insurers to manage and process millions of new policies and claims.
“We have high hopes that Obamacare will drive new demand for health insurance-related business support services that may be readily provided by BPO firms in the Philippines,” Romulo said. “This will surely translate to increased business opportunities for BPO firms in the Philippines, particularly those providing back office services to US-based insurers and healthcare facilities.”
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To aid the expansion of health insurance coverage in the US, Obamacare will be providing subsidies and tax credits to American employers and individuals and will also mandate reforms to simplify and cut down the cost of healthcare in America.
“With a greater number of Americans enjoying health insurance, US hospitals, clinics and outpatient service providers will have to look after more patients,” Romulo said.
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Romulo cited several healthcare business support services as potential beneficiaries of Obamacare: claims processing, premium and benefit administration, agency management, account reconciliation, policy research, underwriting support, new business processing, policy serving, and medical transcription.
Romulo is author of the new Data Privacy Act of the Philippines which mandates all entities to protect the confidentiality of personal data in compliance with international standards of data privacy protection. The new law is expected to boost foreign investors’ confidence and help boost the Philippine BPO industry.
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According to a report presented by Australian Contact Centre Outsourcing Market Study 2011, the Philippines is an emerging top offshoring destination for Australian firms. The study showed that while 81% of the Australian outsourcing market remained onshore, 19% was now outsourced to the Philippines. Other offshore destinations include Malaysia taking only 5% of Australian outsourced business services, and India with only 4%, among others. The BPO services currently outsourced to the Philippines are customer interaction (20%), back-office processing (33%), IT services (18%), and finance (25%).
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The time difference between the Philippines and Australia are pretty short. What this means is that both in-house and the offshore teams will be able to conduct business at the usual time. Both teams will be on daytime shifts. This is also a great advantage for the team in the Philippines. Many employees in BPO firms have agonized over the night shift schedules demanded by U.S. clients, making this one of the drivers for employee attrition in Philippine BPO firms. With Australian clients, the daytime shift will encourage more employees to stay.
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Outsourcing to the Philippines already has its cost advantages especially in its low labor rates. However, Australian firms that outsource to the Philippines can reap even more benefits. Because of the short time difference, the offshore team will be working in daytime shifts, eliminating the need for “night shift differential” in their salaries.