Cost Squeeze #1 Among Health Insurance Pressures
Health insurers face many of the key issues prevalent throughout the Insurance industry. Cost reduction, however, is by far the most pressing issue.
Medical Costs Continue To Skyrocket
With a string of yearly double-digit premium increases, health insurers face tremendous pricing pressures. The rise in costs comes from an aging population, an increase in expensive drugs and treatments, and increased demand. This trend strongly amplifies the need to find efficiencies and reduce expenses.
Customers Demand Faster, Better Service
Health insurers have a long history of poor customer service. They need to dramatically improve in this area to compete and to cross-sell products to their own insured's. They have not yet taken full advantage of technology to speed customer service, improve accuracy, and reduce operating costs.
Regulators and Politicians Exert Great Influence
A highly regulated industry, health insurance receives great pressure from politicians. Healthcare coverage and healthcare reform are favorite topics in political circles. While many health insurers wrestle with a score of regulations like HIPAA (Health Insurance Portability and Accountability Act), experts fear the great number of people who will need health insurance services in the future will overwhelm the current healthcare system. Technology that can handle regulation changes and the increasing need for services is critical.
Consumers Question Medical Practices and Fight For Disclosure
Major health insurers battle consumer lawsuits and demands to overhaul managed care practices. There’s pressure to prove they're not putting profits ahead of medical needs. Critics want full disclosure to insured's on how doctors are paid and how the health plans decide what they will and will not cover. All of this requires high levels of technology to improve operating efficiencies, share information across systems, provide full documentation, and give employees accurate data quickly.
Products and Markets Are Rapidly Changing
Health insurers face a fast evolving marketing and product environment. To cut medical costs, group health and disability insurers are moving to preventative medicine. They're finding creative ways to encourage claimants to get back to work faster. Long-term care is a growing market, but it requires great financial investment. Large, publicly traded managed care companies have announced CDHP or Consumer-Directed Health Plans. All of this change demands smooth processes and a fast flow of information.
The Future of Health Insurers
To overcome these issues, health insurers must make major changes in the way they do business. Specifically, they need to:
Create Operational Efficiencies
Managing content and processes in the most cost- and time-efficient manner possible will enable health insurance companies to maximize profits and address new industry regulations.
Achieve Enterprise-Wide Communication
For higher efficiency and lower costs, end-to-end collaboration is key. Health insurers need to implement seamless connectivity for content and processes across all channels.
In such a fiercely competitive marketplace, companies require streamlined operations to better manage the bottom line and better use employee capabilities.
Health insurers must explore new technologies that empower customers with immediate, real-time access to their policies and claim status via the Web. They need to create customer-centric business models to build their understanding of customer needs. This is essential for acquiring new customers and retaining existing customers.
To maintain compliance with government regulations and protect the insured's privacy, health insurers must take steps to protect their information and update it easily while enabling easy access to that information by authorized parties.
How To Get To That Future
Change is so rampant in the health insurance industry that many companies feel overwhelmed. Rising costs and increasing regulations also constrain them, making it difficult to move forward.
Saddled with IT infrastructures built years ago, health insurers also lack centralized control capabilities and automated processes. Most processes are inefficient, manual, and paper-based, which drains profits at an alarming rate. With this lack of technology, many departments and divisions operate as silos of information, creating an environment where information cannot be easily accessed and shared. For maximum efficiency, health insurers must move to systems that capture many types of data in a single electronic folder so they can be easily shared between departments or sites.
DIT solutions deliver capabilities that integrate with existing health insurance information systems to provide cost-effective solutions that solve real-world business problems. With DIT Solutions, health insurers can access and manage structured and unstructured content, streamline and automate complex, exception-rich processes, connect enterprise information systems, and foster collaboration. With these capabilities, DIT helps health insurers increase efficiency, enhance customer service, maintain regulatory requirements and privacy, increase competitiveness, and improve overall financial performance.
The health insurer survivors will strengthen their market position and align their business to provide superior customer service. This will require implementing faster and more efficient business processes, maintaining compliance with new regulations, and enabling employees to make better decisions at the moment it matters most.