Healthcare reform has created new complexities for payers, which are charged with communicating new regulations in easy-to-understand language to the consumer. Under the Affordable Care Act (ACA), consumers are now entitled to SBCs, the new Summary of Benefits & Coverage documents. These SBCs must be distributed 60 days in advance of all plan design changes and within seven days of a request upon application for a health insurance product. Since ACA was upheld by the courts, payers have found creating and distributing SBCs to be anything but simple, and quite a few are struggling with the logistics of achieving compliance.
SBCs are also a factor in the consumerization of healthcare as 2014 looms and all consumers will be required to have coverage. Payers are going to face an enormous challenge since every one of these consumers -- an estimated 22 million newly insured in health benefits exchanges -- will be entitled to SBCs. These newly insured will expect clear information, fast response and undoubtedly, more customer engagement through effective communication and interaction.
Payers that are competing for new customers in the exchange marketplace will have the advantage if they can provide health plan benefit information in a timely and efficient manner. Given the number of plans, wide variation in benefits, and the required clarity of information through SBCs, now is the right time for payers to look at their overall plan management approach, and how it can be better optimized for greater efficiency and cost savings. At present, most payers have limited or no plan management technology in place. The lack of technology has created significant costs -- in the millions -- with the hiring of temps to manually input data into SBCs. Complicating this problem further, the plan benefit data for SBCs resides in different systems and in multiple formats, which makes it virtually impossible to correctly populate the summaries. As a result, payers are left with inaccurate, costly materials, are out of compliance and have no scalable long-term solution for re-using the data.
Manage Data Holistically
By deploying enterprise-wide, plan management technology, payers will become more competitive to adapt to the frequent changes expected in the consumer-focused healthcare market. Payers that focus on managing the data holistically -- as opposed to managing individual documents -- will be able to generate any benefits document based on their business rules, which allows them to survive and thrive in a consumer-centric environment.
Fortunately, technology does exist to automate the management of plan designs, including solutions for SBC compliance. Payers that implement such a solution will realize the benefits of automation immediately, receive payback quickly, and mitigate the risk of inaccurate data and out of compliance documents.
The cost-benefit of moving from a manual to an automated system has been shown to be as much as a 50% reduction in production and distribution costs.
Another key benefit of transitioning to plan management technology is its ability to support today's bring-your-own-device culture in which consumers are wedded to their smartphones, iPads and other devices. Employers are already using technology to push automated SBCs to a personalized online, searchable portal so that consumers can access their benefits information when it works for them. Technology also is available now via smartphone apps so that participants can conduct their personalized keyword searches about benefits while they're mobile.
Finally, centralizing plan information via an automated plan management system has other advantages. It enables payers to dynamically target individual consumers with specific plans tailored to their needs. Plan management technology is the only solution for payers to add plans, maintain cost control and gain a competitive advantage with consumers
SBCs. New regulations governing payer obligations in coverage communication. Direct-to-consumer sales. Exchanges coming in 2014. The payer healthcare market environment will continue to get more complex and competitive as a result of ACA. This is the perfect time to perform your own internal plan management audit:
- In what ways is your business model changing as a result of ACA?
- What is your profile of new target customers as the exchange market approaches?
- How many and what types of new plans will you be offering consumers in 2014?
- Does your current plan management system adequately support increased complexity and regulations?
- Can you further integrate automation into your plan management system to help streamline plan data workflow and communication of benefits to the consumer?
- Do you have a "plan system of record" in place that enables you to collect, centralize and repurpose plan information?
- Have you run a recent cost-benefit analysis on your approach to SBC compliance?
Payers are facing a radically changed market, driven by consumers and regulatory requirements. Taking a closer look at plan management technology is one step towards developing a plan management system that can meet the needs of consumers, achieve compliance, and also reduce operational costs.
Lori Dustin is the marketing and business development leader at HighRoads, a provider of healthcare compliance and benefits management.