Medical Coding Market

Global Medical Coding Market Size (2024 to 2029)

The global market size for medical coding is predicted to be worth USD 54.28 billion by 2029 from USD 30.77 billion in 2024, growing at a CAGR of 12.02% from 2024 to 2029.

Current Scenario of the Global Medical Coding Market

Medical coding converts medical reports into a short code for use within the healthcare industry. The main aim is to translate diagnoses and procedures and supply information from patient records into universal medical codes billers use to submit claims. This helps to summarize the reports into efficient, data-friendly codes. It evaluates the spread of diseases among individuals. It provides information on national healthcare trends, allowing federal and state governments to plan for the resources required to fight against health issues. Medical coding professionals are responsible for ensuring whether the codes are applied correctly or not. The process involves extracting the information from documentation, assigning the appropriate codes, and creating a claim to be paid by insurance companies.

Impact of COVID-19 impact on the medical coding market

The outbreak of the COVID-19 pandemic has resulted in affecting all industries in the world. However, the medical coding market demand rose during the pandemic. Centers for Medicare and Medicaid Services (CMS) helps a physician handle the medical billing and coding aspect of COVID-10 testing and treatment. Advanced new codes were created during the COVID-19 pandemic for COVID-19 and telemedicine. For the confirmed diagnosis of COVID-19 ​and clinical or epidemiological diagnosis of COVID-19, emergency codes were activated for COVID-19. In April 2020, based on the international guidelines for certification and classification, seven languages were published by the WHO. In addition, the World Health Organization (WHO) introduced new ICD 10 codes used between April and September 2020. As a result, the introduction and modification of codes positively impact market growth.

MARKET DRIVERS

Increasing utilization of CACS, rising incidence of insurance frauds, and rising adoption of AI are primarily fuelling the growth of the medical coding market.

Increasing Utilization of Computer-Aided Coding Systems (CACS) is a primary factor driving the market growth. In addition, growing technological advancements and rising adoption of technologies, such as natural language processing (NLP), artificial intelligence (AI), and the internet of medical things (IoMT), in the healthcare vertical are raising the demand for CACS.The increasing incidence of insurance fraud in the healthcare industry is anticipated to boost the medical coding market during the forecast period. A report by the National Health Care Anti-Fraud Association (NHCAA) is resulting in the intrusion of excessive financial losses, which amount to billions of dollars annually, as estimated by the National Health Care Anti-Fraud Association (NHCAA). In 2018, around USD 3.8 trillion was spent on public health activities, healthcare services, the cost of health insurance, and investments related to healthcare in the U.S., which represented a large number of health insurance claims, out of which some claims were fraudulent.Growing demand for advanced healthcare billing systems, increasing aging population, increasing prevalence of chronic diseases, rising number of hospital and diagnostic centers visits, rising need for a universal language to reduce fraud, and the growing demand for instant, accurate and effective medical billing, increasing adoption of telehealth services for outpatient care are further anticipated to offer lucrative opportunities for the medical coding market. Nowadays, the impact of social media is more on healthcare. As per Binary Foundation, 52% of Americans were looking for service suppliers on social media in 2019. It is used for gathering feedback, managing appointments, health promotion campaigns, product recall awareness, patient education, and recruitment. Revenue cycle management increasing utilization of medical coding. The aforementioned factors will favor the medical coding market growth during the forecast period.

MARKET RESTRAINTS

On the other hand, learning new codes in different languages and lacking skilled professionals are significant restraints to the growth of the medical coding market. In addition, missing or insufficient documentation is one of the considerable challenges to the medical coding market.

REPORT COVERAGE

SEGMENTAL ANALYSIS

Global Medical Coding Market Analysis By Component

Based on the component, the outsourced segment led the medical coding market in 2024. This is due to increasing outsourcing in medical coding requirements. Outsourcing helps in the reduction of time and reduction of cost.

Global Medical Coding Market Analysis By Classification System

Based on the classification system, the International Classification of Diseases (ICDs) segment accounted for a significant share of the medical coding market in 2024. ICD helps gather information into standard groupings of diseases, allowing easy storage, retrieval, and analysis of health information for decision-making and sharing health information among healthcare institutions and countries. In addition, ICD provides a method of diagnostic codes for identifying diseases, and the rising incidence of CVDs boosts the market growth. Advanced improvements of the ICD-10 version are the ICD-11 version. The ICD-11 version has 55,000 unique codes for injuries. However, this version has been ineffective in use in recent years.

Global Medical Coding Market Analysis By End-User

Based on the end-user, the hospital segment will lead the medical coding market during the forecast period. Hospitals are the first options for patients for medical procedures. Therefore, most hospitals in developing countries use medical coding when patients visit as part of their revenue management process. This is further expected to support the high growth of the market in this segment during the forecast period.

REGIONAL ANALYSIS

Geographically, the North American medical coding market dominates the global market over the forecast period. This is due to technological advancements, the increasing geriatric population and a growing number of chronic diseases, and improved healthcare infrastructure in various countries in this region. The U.S. dominates the market for medical coding globally. Advanced healthcare solutions in hospital operations and the availability of many medical coding solution providers are factors expected to aid in maintaining the dominance of the region. The U.S. medical coding market growth is attributed to the development of new technologies, such as Artificial Intelligence (AI)-assisted medical coding. For instance, in September 2019, Fathom, a U.S.-based startup, used Artificial Intelligence (AI) to automate medical coding and increase the speed and accuracy of coding. The increasing use of digital technologies such as electronic health records, revenue cycle management software, health applications, and telehealth in the U.S. drives the market forward. As per the Centers for Disease Control and Prevention., 86.5% of physicians’ offices are using electronic health records in the U.S.

The Asia-Pacific medical coding market is expected to grow substantially in the coming years. Factors such as accelerating adoption of medical management systems, technological advancements across the regional healthcare sector, increasing preventive health programs, modernization & privatization of healthcare technology, augmenting investment in healthcare IT infrastructure, and digitization of supportive government policies are also projected to drive the regional market's growth.

Advancements in the healthcare industry and increased demand for better healthcare opportunities will lead the medical coding market in Europe. In addition, there has been a rise in inpatient visits to hospitals in Europe which has given the need to incur medical coding systems in their medical billing system.

KEY PLAYERS IN THE GLOBAL MEDICAL CODING MARKET

Aviacode Inc., Oracle Corporation, Nuance Communications Inc., athenahealth, Medical Record Associates LLC, Maxim Healthcare Services Inc., 3M Company, and Parexel International Corporation are some of the key players in the global medical coding market and are profiled in this report.

RECENT HAPPENINGS IN THE MARKET

• In 2021, athenahealth announced the general availability of its new athenaOne Medical Coding solution.
• In 2021, Innoventrum, developers of QPro products and services, in collaboration with Dental Medical Billing, announced the launch of its premier credentialing program for dental-to-medical cross-coding and billing.

DETAILED SEGMENTATION OF THE GLOBAL MEDICAL CODING MARKET INCLUDED IN THIS REPORT

This market research report on the global medical coding market has been segmented and sub-segmented based on component, classification system, end-user, and region.

By Component

• In-house

• Outsourced

By Classification System

• International Classification of Diseases (ICD)

• Healthcare Common Procedure Code System (HCPCS)

By End-User

• Hospitals
• Diagnostic Centers

By Region

• North America
• Europe
• Asia-Pacific
• Latin America
• Middle East and Africa