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Beyond the back-office: Cutting medical costs with bpaas (Part 4)

December 09, 2020 - 642 views

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Beyond the back-office: Cutting medical costs with bpaas (Part 4)

Insurers can improve care and cut costs when they take advantage of the synergies of applying BPaaS to both their administrative and clinical operations.

In this blog series, we’ve made the case for payers to adopt business process as a service (BPaaS) to reduce total cost of ownership and improve business outcomes. Analytics and artificial intelligence (AI) can supercharge BPaaS, as they provide payers with insights to compress their front, middle and back offices and deliver better member experiences. Taking these steps are essential to payer survival as new competitors emerge.

As vital as these steps are, however, they address just 10% to 15% of a payer’s cost structure when applied only to administrative operations. The greater prize is optimizing medical expenses.

Annual healthcare spending in the U.S. is more than  $11,000 per person, or $3.6 trillion. The U.S. Centers for Disease Control & Prevention estimates 90% of that spending is dedicated to patients with chronic conditions. While many payers we work with consider utilization, care and disease management to be core competencies for managing costly chronic conditions, these areas are ripe for cost optimization with BPaaS. In fact, payers that execute a holistic cost management strategy that finds synergies in their administrative and clinical operations can drive out eight times more costs. Further, payers that use BPaaS for medical cost optimization can hit healthcare’s Triple Aim targets: better patient experiences, lower costs and better outcomes.

Optimizing Medical Costs with Operations Data

Back-office operations, such as claims processing, contain vast quantities of data that can yield great value when aligned with clinical data, such as identifying high-risk individuals. BPaaS and AI can automate this process. Take a person diagnosed with Type 2 diabetes who goes to a doctor’s appointment but doesn’t fill her prescription for metformin. The claim for the physician’s visit would show the diagnostic code, and an AI agent could flag the absence of a prescription claim. Because the data indicates that the patient is likely not adhering to her treatment plan, a care manager or physician – or even the AI agent – could contact the patient for follow-up.

As the new healthcare data interoperability rules take effect in 2021, even more data will be available to payers and clinicians. Here, the hope is that machine learning and other AI tools could proactively identify members at risk for chronic conditions before they become reality. One study suggests if the U.S. could take steps to prevent chronic conditions, as much as $1.1 trillion could be saved. Educating, encouraging and empowering high-risk members is key. Holistic cost management should optimize connections among care managers, members and providers, enabling all to collaborate more easily with more data available to inform their decisions.

As value-based contracts and outcomes-based reimbursements grow, the need for payers to mine their data will only increase. Payers operating under value-based care must have good insight into a population’s health status and potential issues to manage them better.

Organizations with combined health plan and healthcare systems (“payviders”) are in a good position to identify and implement synergies across administrative and clinical data and functions, such as the feedback loop around claims data and electronic health records data. A holistic BPaaS solution here would also incorporate revenue cycle management functions spanning clinical and operations activities. These could range from verifying code accuracy closer to the point of care, to prompting discussions with members about their out-of-pocket costs and financing options.

Focus on the Member

By focusing on the member experience, payers can set priorities about implementing holistic BPaaS. Developing member personas and mapping their journeys can reveal pain points that involve both administrative and clinical functions that could be addressed through BPaaS, such as pre-authorizations. When the new interoperability rules make claims data from previous health plans easily transferrable, an AI agent could scan historic claims data and automatically set up a new member’s pre-authorizations and enroll them in a care management program. When payers can seamlessly transition consumer care to new health plans, they can avoid missed care opportunities, eliminate the cost of manually reviewing records and improve the member experience – achieving the Triple Aim.

Payers that incorporate BPaaS into a holistic strategy that meshes administrative and clinical data will need to make changes to their workflows and business models. Doing so may also require breaking through a siloed mentality about which activities are appropriate for BPaaS. By working with a service provider that has broad capabilities across healthcare’s administrative and clinical continuum, payers can seize the opportunities and synergies that lead to compelling cost savings.

Holistic BPaaS can be the foundation for new care delivery, sustainable growth and richer, more collaborative provider and member experiences. Payers with the foresight to pursue a comprehensive BPaaS strategy now will be equipped to compete effectively while leading the industry in bold new directions.

Digital Business & Technology bpaas, business process as a service, digital healthcare, digital insurance, health insurance, medical costs, payers

John Reynolds

John Reynolds, Ph.D., has over 30 years of healthcare services, benefit consulting and financial technology experience. He is...

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