Shifting consumer needs, international health emergencies such as the COVID-19 pandemic, and other forces in recent years have accelerated the evolution of the global healthcare industry. Healthcare organizations the world over are under more pressure than ever to become more customer-centric. Achieving this, in large part, means finding ways to deliver highly efficient, secure, and personalized service to clients.
Health insurance providers are not exempt from this prevailing expectation to innovate. However, many insurance companies all over the world remain shackled to aging legacy technologies. These systems not only lack the speed and flexibility to keep up with the demands of the current market, but are also becoming increasingly difficult and costly to maintain. At this critical juncture, insurers who have yet to upgrade their systems must urgently consider the shift to using modern insurance software.
The following are three compelling arguments for pursuing innovation in commercial health insurance:
Customer Needs and Expectations Are Changing
Due to the rise of digital technology, today’s customers have much more access to information on healthcare regulations and products than those of generations past. They are frequently more motivated to do meticulous research on the medication and treatment options available to them, instead of settling for traditional or established choices. These behaviors suggest that customers desire an active role in managing their own health and wellness.
Current research on the subject shows that modern customers mainly want simple, streamlined digital services from their insurance providers. One survey by PricewaterhouseCoopers’ strategy consulting business Strategy&, for example, instructed more than 500 consumers to rank 15 technology-enabled functions that a health plan might provide in the order of most to least desirable. The most preferred features were surprisingly basic across the board, including online appointment booking, online and mobile access to health records, follow-up mobile notifications for post-care, and a tool for estimating out-of-pocket costs.
This preference for simplicity and convenience overall reflects the experiences these customers have had with digital technology in industries such as retail and banking. These industries routinely focus on making everyday transactions as fast and as frictionless as possible. Due to this, consumers have now begun to seek similar user experiences from all their service providers, insurers included. It thus makes sense for insurance companies to make enhancing customer convenience a major priority.
Legacy Systems Pose Significant Risk to Providers
Some of the legacy systems that health insurance companies continue to depend upon today are decades old. Not only is it difficult, if not impossible, to write new technology into these antiquated systems, but the resources to maintain them are also growing increasingly scarce. As experts with the maintenance skills and knowledge for legacy systems continue to dwindle, companies that still use these technologies risk being left without options in the event of malfunctions or system failures.
Furthermore, legacy systems are neither fast nor agile enough to keep up with modern competitors. Many may take months to bring a new benefit to market, and making adjustments to current offerings likewise takes time. More contemporary systems, on the other hand, can set up new plans or restructuring old ones in just a day. These abilities give organizations that run these modern systems significant advantages when it comes to attracting and retaining customers.
Insurance members also want speedy, seamless enrollment and claims processing, which are demands that legacy systems just can’t meet. Batch processing remains the standard operating procedure for legacy systems, whereas providers embracing innovation have found ways to complete enrollments in real time. These providers have also built the technological infrastructure necessary to deliver benefits to members on the same day, rather than a week or more later.
Modern health insurance solutions help providers reduce their error rates, bring new offerings to market quickly and efficiently, and accelerate enrollment. Overall, embracing this technology can make insurance companies more efficient, reduce operational costs, and facilitate timely, appropriate adaptation to changing business conditions.
Modern Software Solutions Are Highly Flexible
Healthcare organizations are mainly slow to innovate because they tend to assume that the risks outweigh the rewards. They often view innovation as an all-or-nothing, multi-year system overhaul costing tens of millions of dollars.
Modern solutions, however, support a more incremental approach to innovation that enables organizations to target problem areas first and introduce further structural changes from there. Cloud-based solutions afford the highest level of flexibility in this regard.
Modernizing claims processing and adjudication procedures, for instance, is one of the first steps an insurance provider can take on their modernization journey. Claims management is a crucial area that can make or break relationships with members and serves as an important test of overall business performance. Indeed, today’s customers desire accurate, transparent, and timely payments from their insurance providers. Companies can meet this expectation by choosing software solutions that allow for real-time adjudication, automated approvals, and more agile pricing.
At the end of the day, the push for greater technological innovation is all about making insurance companies more future-ready. Companies that leverage digital solutions to provide top-notch service have the best hope of outpacing their competition and remaining relevant for years to come.