Claims Integration – A Growing “Must Have” for the Voluntary Benefits Market
Introduction
Of the many group insurance industry challenges laid bare by the pandemic and resulting shelter-in-place orders, the need for an effortless digital customer experience remains paramount. The surrounding business world has become increasingly more customer-centric as prominent companies have continually raised the bar on what customers can expect from a digital customer experience. Unfortunately, many group insurance companies’ legacy systems lack the sophisticated, modern technology to support a next-generation customer experience, and excessive manual paperwork, complex policy language, and delayed claims payments remain the status quo. In an ideal scenario, the customer would not have to take any action to submit or validate a claim (otherwise known as “auto-adjudication”). To attain auto-adjudication, innovative voluntary benefits carriers are frequently turning to claims integration to provide a smoother claims experience for their customers.
Claims Integration Benefits 101
With claims integration, the claims submission process is simplified, therefore enhancing the customer experience and increasing customer satisfaction. If the customer’s voluntary benefits carrier maintains an integrated claims process, then the customer can receive their claims payment with minimal effort, due to system-based models that retrieve and analyze claims data. Customers can then instead focus on their rehabilitation and recovery. As the voluntary benefits industry attempts to make inroads into consumer benefits offerings, to also differentiate themselves in a what has become a highly commoditized industry, promoting the value of claims integration to customers can also increase consumer awareness and the perceived value of voluntary benefits overall.
Voluntary benefits carriers can also benefit from claims integration functionality. Variable expenses per claim should decrease dramatically, as less human intervention is involved with the claims adjudication process. Carriers’ staff are then freed from claims processing and can devote their time and efforts to other tasks. Carriers’ reputations and business retention should also subsequently improve as customer satisfaction increases.
The Obstacles
Despite the varied benefits of claims integration, the elephant in the room is the question of Health Insurance Portability and Accountability Act (HIPAA) privacy concerns. As medical records can only be released with the consent of the individual or a guardian, carriers must have the appropriate documentation and consent to use the medical claims data in the claims integration process. In addition, unless the carrier is offering medical and voluntary benefits under the same legal entity, it may be more difficult and time-consuming for a voluntary benefits carrier to obtain the necessary information to automatically process and pay claims. This ultimately puts medical carriers at a competitive advantage. However, in some instances, voluntary benefits carriers may be able to adjudicate claims with non-major medical data, such as disability or other claims processed by the carrier, to avoid this issue.
Another concern for voluntary benefits carriers is that to develop a claims integration process, the carrier must implement the proper claims adjudication methodology. The implementation typically involves complex algorithms that use medical coding information, and the quality of the customer experience is often directly tied to the quality of the claims integration algorithms. Sometimes carriers may need to modify contract language and limitations (and potentially pricing) to facilitate system and data needs as they move toward full claims integration. To solve these challenges, it ultimately may be more effective for carriers to use external consultants to develop the claims integration processes. Experts can provide a wide variety of assistance including product restructure support to facilitate claims integration or assistance with medical record code interpretation, medical code mappings, and claims processing algorithms.
Conclusion
Among voluntary benefits carriers, implementing claims integration will likely become a “must-have” feature in the very near future. Claims integration allows customers to fully access and use the inherent value in voluntary benefits products while providing a smoother claims experience. The additional value provided by claims integration can potentially boost customer awareness of these products, increase customer satisfaction and long-term customer loyalty, to ultimately attract more purchasers.
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