The 'Edge Report

HealthEdge Voice of the Market: Health Insurers and Operational Efficiency

To understand how health plans are thinking about operational efficiency, HealthEdge, in partnership with Survata, an independent market research firm, recently conducted interviews with 101 health plan executives. Among other questions, the survey asked:

  • What is your organization’s greatest challenge to achieving lower administrative costs and increased operational efficiency?
  • What do you see as your organization’s greatest opportunity to lower administrative costs and increase operational efficiency?
  • Which is the most important action that your organization could take to lower administrative costs and increase operational efficiency?

Health plans know that to truly optimize operations they must minimize the use of manual processes. If they can do that, they will save time, reduce errors, improve member experience, and effectively utilize analytic insights. The survey results show that payer executives overwhelmingly listed poor technology innovation as the key factor preventing them from achieving operational efficiency. Health plan executives also responded that any cost savings from operational efficiency could be applied to the organization’s bottom line. This reaffirms the constant margin pressure health insurance organizations face.

The health insurance industry is largely plagued with notoriously old infrastructure because of the perceived challenges and major investment necessary to transform. Gartner says of legacy systems: “Frankensystems, legacy packaged systems and even some digisystems have limitations that actively inhibit payers from achieving important optimization or transformation business outcomes. These core administrative processing systems (CAPS) have no place in a payer CIO’s long-term strategy for administrative modernization. CIOs who want to modernize their CAPS must demand next-generation solutions to cost-effectively support their digital initiatives.”[i]

The opportunities for health plans to lower costs, improve member satisfaction, and reduce manual processes require robust operational efficiency which requires a next generation technology partner. Read the full survey report or contact our team to discuss how our clients are transforming their operations.

[i] Source: Gartner, U.S. Healthcare Payer CIOs Must Pursue Next-Generation Core Administrative Processing Solutions, by Mandi Bishop, July 4, 2018. ID#G0035228


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