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Medical transcription service as an allied health service is a primary mechanism to facilitate continuity in patient care.

Medical transcription service is an allied health service rendered for the documentation of certain medical patient information that the medical industry considers necessary to regulate medical services and to satisfy insurance provider requirements.

When a patient visits a doctor, modern medicine practice dictates that the doctor should spend more time examining the patient for his medical problems, including the latter's medical needs, than creating the necessary documentation therefore. After performing the physical examination of the patient, requiring various laboratory or diagnostic studies, making the diagnosis or differential diagnoses, and deciding on a plan of treatment, the doctor uses a voice-recording device, which may be a hand-held recorder or a telephone dialed into a remote server, to make a report of pertinent information about the doctor-patient encounter.

A medical transcriptionist, also known as a medical transcriber, then accesses this report by listening to the dictation, and transcribes it into the required format for medical documentation or record. This record may be printed and hand-placed in the patient's record, and/or archived as an electronic medical record immediately accessible to subsequent departments, or other healthcare or medical transcription service providers, facilitating healthcare delivery regardless of geographical distance or location.

In this sense, medical transcription is the primary mechanism to assure continuity of care to patients. The next time the patient visits the same doctor or any doctor within the same or another medical institution either doctor can call in or refer to the pertinent medical record containing reports of previous encounters. The doctor can also on occasion refill or modify a patient's medications after perusing only the medical record.

Medical transcription service includes performing document typing and required formatting functions, transcribing the spoken word of the patient's care information into an easily readable form. As the medical transcriptionist creates the final record they also take care to make sure that all the terminology used in the statement are clear and correct while also taking pains to ensure correct grammar and language. The service also includes the timely return of the finished transcription document, in print or electronic form. In all aspects of the service, medico-legal policies and procedures, and patient confidentiality are complied with.

Medical transcription may be rendered from a location within a hospital or any medical institution, or via a direct or remote transmission from such hospital or other medical institution to an actual medical transcription service provider in an off-site location employing the technology of computers, the Internet, and such other modern technologies.

Because of the increasing demand for medical transcription service, some countries are already outsourcing the service. In the United States alone, the medical transcription business is estimated to be worth at least US $10 to $25 billion annually, growing fifteen percent each year. Because of the growing demand, companies have begun outsourcing medical transcription services. However, the main reason for outsourcing is still the amount of many saved because of cheap outsourced labor.

The Association for Healthcare Documentation Integrity (AHDI) is one of the world's largest organizations for medical transcription service providers. It is AHDI's mission to lead the evolution of medical transcription, represent and advance the profession and its practitioners. The group has formulated and implements a compendium of rules for medical transcription to guide medical transcription providers in creating good and easily understandable medical transcripts.

Medical transcription is important to make sure that the medical records of a patient are kept properly and accurately. Because of it, one set of records will be available to all doctors who treat the patient, enabling proper and correct treatment.