Healthcare Payer BPO operations have mainly focused on the operational side of the Payer business with specific focus on improving the efficiency of the process. Some of the key business processes include claims processing, contact center, enrollment, and data entry. The BPO participation has tremendously increased the efficiency and brought down the cost of the process on a high scale for the Payers who have participated in this space because of cost arbitration. But in light of the recent regulatory changes, BPO service providers have to move beyond the traditional lift and shift. The focus instead should be on enhancing the processes in areas like the opportunities that have been brought in by the Healthcare reform legislations. By focusing on the following areas, the BPO space can directly contribute to the core of the business areas like utilizations and as well contribute to the operating margin of the payers.
The Patient Protection and AffordableCare Act (PPACA) have multiple regulations that would transform the Healthcare Payers to alter the way they conduct business. One among the metrics is Medical Loss Ratio which signifies the percentage of premiums insurers use for medical costs versus the amount that goes to paying administrative overhead. For individual and small-business plans, it's set at 85 percent medical to 15 percent administrative. For larger businesses, the magic medical number is 80. Those who don't meet the threshold would be forced to pay rebates which run into millions of dollars to customers. For example, a large Health Plan has to refund $280 million in their subsidiary business alone as per the calculations of Avery Johnson, an analyst with the 'The Wall Street Journal'. To improve the ratio, the health plans will focus on Care coordination as an opportunity to enhance the processes.
The compliance with the regulation is a complex and costly process for health plans and care coordination is a prominent area where they can invest to meet the ratio needs. A good area to start with is the nursing staff coordination. BPO service providers can make a bigger contribution in this area due to the shortage of nursing professionals in USA. By developing the contact center capability the BPO players can provide 24 X 7 nursing hotline solutions to help Healthcare Payers deal with their care coordination needs. The nurse contact center will enhance Healthcare Payers to improve the regulatory compliance as well as improving their own margins and thus morphing in to a win-win business case for both the BPO service providers and the Health Plans.