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There are three different types of medical transcription employment: sole proprietor, working for a medical transcription services firm, or managing a transcription firm. A medical transcriptionist is a trained professional who accepts audio files from doctors, surgeons, and other medical services staff and transcribes the text into a written document. In addition to providing a verbatim transcription, the medical transcriptionist is expected to correct the document for standard grammar and use the appropriate medical terminology and abbreviations.
Sole proprietorship is the most common type of medical transcriptionist employment. A sole proprietorship is a business model where the skilled person operates his own business. The medical transcriptionist advertises his services to potential clients, complete with a price list. Clients submit their audio tapes to the transcriptionist for processing in an agreed upon time frame. The medical transcriber completes the work and returns the finished product and invoice to the client.
In a sole proprietorship, the total income for services provided is considered business income. The transcriptionist is able to complete the work according to his own schedule, and wherever he likes. In this type of business structure, there are a wide range of expenses and tax deductions that can be used to reduce the taxable income that is generated through medical transcription employment services. The business risk is also absorbed by the transcriptionist — if the clients do not pay, there is no income for the work.
Working for a medical transcription service allows the transcriptionist to receive the original files, process them, and return the finished product to the service. He or she is paid either a salary or a set rate, based on the volume of processing completed. This type of medical transcription employment income is usually considered employment income and is subject to all the standard deductions. It is the responsibility of the firm to find new clients, manage any complaints, and collect payment. The business risk is absorbed by the services firm — if the clients do not pay, the transcriptionist must still be paid.
Managing a transcription firm can occur when a sole proprietorship becomes so busy that additional staff must be hired. In this type of medical transcription employment the manager must actively find new clients, maintain a steady level of work for the transcribers, and ensure that the same level of quality is maintained.
During the transition from one type of employment to another, it is very important to work with professional services advisers. This team includes a business lawyer and an accountant. The business lawyer is important for setting up the business in the proper structure to minimize the risk, provide a templated services contract, and provide advice about business liability insurance. The accountant provides advice on tax filings and deductions.
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