Enterprise Business Process Management for Health Care Payers
A New Revolution
During the past 30 years, health care payers have repeatedly pointed to the lack of scalable, robust, payer-specialized applications as a significant barrier to achieving efficiency and agility in the enterprise. In an effort to improve productivity, reduce costs, and increase customer responsiveness, payers have traditionally relied on internal resources or core administrative vendors to build solutions that manage and process key transactions such as enrollment, billing, customer service, and claims payment. This approach has resulted in siloed applications within the enterprise that encourage isolated functional activities. Consequently, health care payers have become heavily dependent on costly manual processes and disparate systems and applications within and across functional areas that are unable to communicate effectively with each other. Moreover, this point solution infrastructure has made it difficult for payers to build and manage change in a constantly evolving industry.
The intense competitive pressures felt by health care payers since Y2K have compelled them to re-examine their business practices and responsiveness to changes within their market environment. With consumers moving away from managed care to products giving them greater access to providers, health care payers are being required to create a flexible business model that will allow for more innovative consumer-directed health care management. Adding to this pressure, industry consolidation is developing increasingly larger regional and national entities that are able to use economies of scale to deliver similar or better services. The resulting requirements for change and increased competition demand that health care payers embrace new technologies that will focus on business value investments that will increase customer satisfaction, reduce costs, break down organizational barriers, and help them plan for ongoing market and regulatory change. In fact, according to an April 2003 Gartner Group report, Health care payers must promote seamless customer interfaces across all channels and collaborative information to ensure their transformational success.
Health care payers are exploring and committing to business process management (BPM) solutions as a way to achieve these goals. BPM is not about solving new problems, but solving existing problems in a new way more cheaply, more quickly, and more effectively. By allowing health care payers to address these problems as a set of well-defined and integrated processes rather than independent and isolated problems, BPM enables the integration of silos and removes the boundaries created by point solutions. The result can be dramatic, incremental, and demonstrable improvements to business processes such as claims management, customer service, or underwriting. And because the business processes can be easily modified, health care payers tangentially benefit from increased agility to manage organizational change, continuous improvement, and high ROI. With these capabilities, BPM delivers operational efficiency that earlier technologies were incapable of duplicating. Borders are extended so that users within and beyond specific departments are able to accomplish related tasks. Furthermore, BPM broadens the capabilities of disparate, data-centric enterprise applications with fast and flexible synchronization of data among applications, within the enterprise, and externally to partners, customers, and other constituents.
Ingredients for Success
Health care organizations are built on a foundation of business practices and operational processes. Smart, innovative processes that increase productivity, member satisfaction, and quality allow health care payers to leverage the work they do into a significant competitive advantage. The ability to continue to innovate and improve those operational processes is the only way to develop and maintain business advantage. As Michael Hammer, president of business education and research firm Hammer and Company said, Customers are fundamentally the most important corporate asset, but process is the basis of your competitive advantage. A BPM platform that integrates both business practices and operational processes enables health care payers to effectively model, design, and execute processes. The BPM solutions ability to capture, incorporate, and automate practices and processes delivers one and done processing by requiring less human intervention, and enabling instant connections to backend and legacy systems. For example, imagine being able to automate the key processes associated with complex underwriting and rating shortening the underwriting cycle by eliminating manual steps, and enabling new products to be developed quickly and cost-effectively.
To be truly effective in the health care enterprise, BPM solutions should have the following characteristics:
Vendor Commitment to the Health Care Industry
Early BPM implementations were generally white board drawings that attempted to deliver elegant, broad-based solutions. While many software products can accomplish this level of functionality, there is a significant cost to defining the limits of the white board (sometimes limitless), as these elegant, wide-ranging solutions generally do not have clearly defined ROIs, or if they do, they are rarely achievable.
BPM implementations that deliver the largest ROIs incorporate specific health care payer requirements, such as rating methodologies, claims processing, or enrollment, but they also offer the ability to expand the process management functionality across the enterprise. After gaining familiarity with the underlying software and an understanding of the ROIs to be achieved, health care payers can implement process management efforts that can then be expanded beyond the typical health care best processes, and into other areas of the organization. This incremental approach prevents the enterprise from repeating the misjudgments made during the late 1990s when they jumped into enterprise Internet solutions that purportedly could solve all the health care payer problems.
Intent-Led Processes
In the age of consumer-driven health care, customers have higher expectations and demand for faster service response times. According to a February 2004 Forrester Research report, BPM systems are being used with increasing frequency to improve the effectiveness of core operations but the key beneficiary of BPM systems is the customer. To increase the intelligence and decision-making capabilities of their systems, health care payers must look to smart applications that not only understand their business intents, but also their customer intents.
Generally, health care payers have been able to present large amounts of customer data, but lack systems that can automate complex decisionmaking and work resolution. For example, too frequently customer service representatives (CSRs) must access various systems that sometimes require transferring customers to different departments to complete their interaction. The CSR and others within the organization become entangled in multistep processes simply to accommodate customer requests such as changing providers or resolving claims questions that should not require these handoffs.
Intent-led processing begins with the premise that the organization has an understanding of:
- The reasons their customers call; and
- The goals to be accomplished with each customer interaction.
The output of the first premise is a frequency distribution that describes the reasons customers call. It is also associated with the businesss ideal intentions or most desirable outcome for each reason. Using process management software, this series of intents can then be mapped and used to guide CSRs through prompting and scripting, enabling them to deliver a more consistent and higher quality interaction. The output of the second premise is a matrix of preselected potential intentions that should be pursued when the customer, regardless of the channel, contacts the organization. Based on information such as claim or diagnostic data, this matrix of intentions can range from a requirement to update the customer or dependent about a particular disease management program to a cross-sell or upsell opportunity for products not currently being purchased by the customer (see Figure 1). As a result, the business can intelligently guide its CSRs through customer interactions, presenting only the relevant data required and automatically queuing follow-on processes that are appropriate and personalized for the interaction.
Figure 1. Examples of Intent-Led Processing in a Health Care Payer Organization
By giving systems the ability to intelligently automate steps, reduce work, and automatically address enterprise needs, a BPM solution can increase customer and employee satisfaction while maximizing revenue and optimizing the cost of service. In fact, according to Michael Maoz, vice president of Gartner, Inc., The need for intelligent processes is paramount. Process improvement can fill the yawning gap that exists between the promise of quality customer service and the actual delivery of it, eliminating that gray area where time and money are lost.
A Tightly Coupled Business Rules Engine and BPM Platform
Whether organizations are dealing with health care-specific applications or intent-led processes, solving this class of process management problem requires more than traditional BPM software. To provide the decisioning dimension, a business rules engine (BRE) is required to complement the BPM software. The BRE software enables the organization to digitize its rules and policies and then act on them, as it would if a person were performing the business process.
In the past, this functionality was provided by loosely coupling the BPM and BRE applications from different vendors. Unfortunately, this requires additional programming to glue the applications together, constant database management to maintain the integrity of the data model required by each application, and attention to product versioning and release continuity.
There is an emerging view that the only way to achieve true agility is to have the decisioning rules built into the process with a common enterprise business model. Complex health care payers with multiple locations cannot afford to manage hundreds of process flows and business rules in separate repositories. This model only scales when solving simple, self-contained, departmental problems. Business rules must be first-class citizens within the BPM solution. In fact, a September 2003 Delphi study of IT professionals noted that the most critical element of todays BPM systems is an integrated business rules capability (see Figure 2).
Figure 2. Business rules should be a core component of any BPM solution.
When business rules are captured and executed in the context of process flows, they create smart processes. Now, rules that drive the processes of member services, enrollment, or claims management are inseparable and actually depend on one another. This integration provides a flexible and scalable framework for automating, streamlining, and analyzing business processes and rules; and for facilitating collaboration and simplifying decision making across the payer enterprise. Further, this integrated architecture enables smarter processes that not only increase productivity and quality, but also provide the flexibility to evolve and grow and result in long-term operational efficiency, business agility, and increased customer satisfaction.
Integrated Business Activity Monitoring
Coined by Gartner Inc., the term business activity monitoring (BAM) relates to activity that provides real-time access to critical business performance indicators to improve the speed and effectiveness of business operations. This emerging set of capabilities graphically represents fragmented and historical context data so that health care payers can better measure and manage business process performance for real-time decision making leading to better ROI. BAM functionality extends managements ability to examine and monitor business processes, assignments, work in progress, progress against service-level agreements, and data generated and executed by BPM and related software. With these tools, which often include real-time reports and graphs, for example, a claims manager can obtain greater visibility into the claims process and measure operator performance against expectations.
Proven Results
In the end, health care payers need to achieve measurable and real business differentiating results with BPM solutions. Significant ROI can be recognized in less than 12 months, depending upon the area of application and the size of the enterprise. These impressive results have been demonstrated across many functional areas of the enterprise. The integrated capability of BPM and BRE can generate:
- Significant increases in proposal generation activity and sales;
- Significant decreases in CSR handle-time with higher customer satisfaction; and
- Significant reduction in claims inventory and processing time.
Conclusion
Tightly integrated business process management software and business rules engines are demonstrating, with proven results, that the traditional boundaries and limitations associated with functional specialties within organizations can be removed. Moreover, the removal of these silos can result in increased productivity and improved quality of customer interactions. Further BPM solutions help health care payers meet consumer needs for more efficient services, flexible products, and timely information. With smart BPM solutions, health care payers not only gain greater insight into their processes but can leverage the work they do to sharpen their competitive edge in the marketplace and accelerate the speed in which they do business.
