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While Affordable Care Act has created huge opportunities for payers, most of those opportunities cannot be leveraged to their full advantage using 20th century strategies.
When future historians look back on the health insurance industry, it is likely that a line of demarcation between the “old ways” and their present will be the passage of the Affordable Care Act (ACA).
It not only expanded healthcare coverage access to millions of Americans, it created a marketplace where payers had (and have) to work directly with millions of individual insurance neophytes rather than a smaller number of benefits professionals.
The downside of all this change is that many health payers are poorly prepared for it. Strategies and processes that worked well pre-ACA do not always translate well post-ACA. In order to succeed, payers need to adopt new strategies and new ways of thinking.
Here are some of the biggest changes that are proving problematic for payers.
1. Processing adults and children differently.
Among the Essential Health Benefits provisions in the ACA are the requirements that payers must offer pediatric vision and dental benefits to participate in federal and state exchanges.
While it makes sense on a human level, it can wreak havoc with payer systems because for the first time in history, adults and their dependent children on the same policy have different benefits. Yet deductibles and other out-of-pocket expenses from all family members must roll up into an overall total.
Legacy systems were built with the assumption that all benefits would be the same. Payers must now add the ability to track these differing benefits accurately, either by revising their systems, purchasing new technologies, or partnering with benefit management organizations that already have these capabilities. However they go about it, the new solution must still be able to integrate easily with those legacy systems in order to be effective.
2. Replacing manual claim handling with automated systems.
Just attempting to review every claim manually, especially those that include government subsidies, will quickly overwhelm even the best-staffed payer organizations. Add in all the other paperwork generated by members and providers and it becomes impossible to keep up with the workload.
Automating these processes allows payers to reduce manual work so they are only reviewing the exceptions, helping them manage the increased volume while ensuring faster resolutions for all. It also helps keep costs from rising along with membership; a good automated system can handle 1 million claims as easily as 100,000.
3. Delivering exceptional customer service and support.
Much has been made about competing in the exchanges to win new members. Yet it is just as critical to keep those members satisfied throughout the year, so when the time comes to renew they don’t start looking elsewhere.
While processing claims quickly and accurately is essential, consumers want more. Payers must be able to explain all the nuances of health insurance in simple terms, and help their members understand how to track items such as their progress toward out-of-pocket limits.
Since many ACA members may find it difficult to call with questions during the day due to job constraints, payers need to make this information available outside normal business hours.
Establishing self-service portals that provide detailed account information, answer the most common questions, and allow users to submit inquiries when it is convenient for them greatly elevates the level of customer service, leading to greater satisfaction among both members and providers, an important factor when renewal time comes. These portals are also extremely valuable in maintaining provider satisfaction.
4. Easing the transition to pay-for-performance.
Among the changes brought on by the ACA is the movement toward value-based payment. Numerous accountable care organizations are experimenting with new forms of provider reimbursement, such as bundled payments, to align incentives and better manage care.
Each year the federal government, particularly the Centers for Medicare and Medicaid Services, is doing more to push the healthcare industry in this direction. Payers that can help providers ease the transition by aiding them with developing specific contract language, managing administration end-to-end, automating manual processes, and so on, can win more of that business and set themselves up for future success.
While the passage of the ACA has created huge opportunities for payers, most of those opportunities cannot be leveraged to their full advantage using 20th century strategies, or technologies. Payers need to understand the new realities and begin adjusting their strategies accordingly.
Craig Kasten is chairman of SKYGEN USA, a collection of benefit solution companies that brings together a mix of next-generation benefit management and technology tools that help healthcare organizations be market-leading and reform-ready. Craig can be reached at firstname.lastname@example.org.