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Worries grow as health jobs go offshore

The outsourcing of nursing functions may be the most risky of the positions being shifted to save costs.

July 25, 2012|Don Lee

As for outsourcing services that are more clinical in nature, Safavi said, "People are looking at all the tasks that can safely and responsibly be moved. It's still an emerging market. We're still trying to understand the market's tolerance for it."

In general, hospitals are moving more slowly than health insurers to send jobs overseas. But with financial pressures intensifying and the uptake of electronic record-keeping accelerating, analysts and industry people see more consolidation and outsourcing ahead.

"When you have people's medical, billing and other records kept electronically, then it opens it up to establishing a call center virtually anywhere," said Steve Trossman, a Los Angeles spokesman for the Service Employees International Union, which represents hospital workers. "There is no longer a reason for it to be physically in the same place as the paper records."

Moreover, the healthcare reform law could prod insurers to move more jobs to cheaper-wage countries. The new law requires companies to spend 80% to 85% of premiums on medical care, limiting the amount available for administrative expenses.

Few have been as aggressive as WellPoint, which made a profit of $2.65 billion last year on revenue of $60.7 billion. WellPoint's total employment at the end of last year was 37,700, down from 40,500 two years earlier.

In one of its recent efforts, WellPoint laid off pre-service nurses in Colorado and Nevada so the work could be done in Manila, according to a Labor Department filing by a WellPoint human resource manager in Denver. WellPoint spokeswoman Binns said none of the decisions that involve denial of procedures or treatment for patients are made overseas.

Overall, Binns said, fewer than 2.5% of the 37,000 employees, or at most 925 workers, had lost jobs in the last 18 months as a result of work sent overseas. Only about 50 of those positions involved clinical management of care, she said.

WellPoint's "sourcing strategies have enabled us to make our services more effective, accessible and affordable to our customers, while allowing us to expand our programs and maintain our service levels," she said.

WellPoint's offshoring covers a wide range of departments and tasks involving claims, enrollment, billing, post-service clinical claims review, utilization management and pre-service nursing, according to filings made by company managers and state government officials.

Both were helping secure federal trade-assistance benefits for WellPoint workers who have lost jobs because of outsourcing or import competition.

Shannon Cunningham of Columbus, Ohio, who processed medical claims for WellPoint, was laid off last month after a colleague went to the Philippines to train people to do her job.

Cunningham, 43, said she received eight weeks of severance pay. She and others working in medical claims earned $30,000 to $40,000 a year with health benefits, she said.

"I know other countries need work," said Cunningham, a company employee for three years.

But "I just felt like it wasn't fair. We're having a rough time too."

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don.lee@latimes.com

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