4 Value-Based Trends for Healthcare Payers in 2016

Stepping on efficiency while reaching for value. This is the mantra for health care payers in 2016. Bold leadership action is required that stares at conventional ideals of ‘business as usual’ and takes the challenge past day-to-day and steps firmly into a ‘new normal.’ In this shifting world mixing cost, access and quality — how do we discover value? 

Four growing frontiers, the modern gold miners paradise, are challenging boards to believe and temping consumers to get engaged.  Value alignment, benchmark services, business capabilities and cloud first will echo the halls of healthcare conferences in 2016. Today, we’ll prepare you for those tabletop discussions. 

 

Value Alignment

Customer Journey mapping isn’t about the customer. That’s right, it’s actually about better understanding your business and the customers you serve. Value streams maps, process maps, spaghetti diagrams and consumption maps all build value alignment before, during and after integrating the customer experience. Spend time to brainstorm with your leadership team. We all have experienced the dreaded a ‘day-in the-life’ exercises: identifying consumer touch points, defines your experience map and articulates how and when your customer is engaged. Still think it’s a bit squishy and feels like a marketing spin? Customer contact drives profits, and ineffective customer touchpoints widen expense leakage. Take time to fix the entire leaking boat before expanding services, when existing services and products are not integrated into a unified customer experience.

 

Benchmark Services

Benchmarking isn’t about holding vendors accountable to SLAs. All SLA governance and monitoring is reactive and is akin to reading the newspaper from last month, you may find things you missed but it isn’t not going to change how you operate your business. Eventually, that information will land on a shelf and develop into a Starbucks story told to new on-boarders.

Benchmarking is about comparing your business to your competition. It’s taking a comparative approach to how your organizations delivers the following:

  1. Customer experience and Digital Strategy (end-to-end customer service)
  2. Demand and Process Management (how requests are handled and the organization project intake processes)
  3. Business and Solution Architecture (building extensions today for capabilities needed tomorrow)
  4. Information Security and Risk (not only system security controls but process based security controls)
  5. Project Management Office (how you manage project priorities)
  6. Contract Management (procurement through requirements management)
  7. Quality Assurance (third-party validating, what was promised for delivery was in fact delivered)
  8. DevOps and Application Development (automation and consistent quality delivery)

 

An assessment can provide your organization with actionable information identifying gaps with a navigation map in hand to guide business capabilities growth. When considering how to identify gaps reviewing these eight critical areas helps focus in on value: 1. Customer Experience / Digital Strategy, 2. Demand and Process Management, 3. Business and Solution architecture, 4. Information Security and Risk, 5. Project Management, 6. Contract Management, 7. Quality Assurance, and 8. DevOps and Application Development.

 

Business Capabilities

Business capabilities are often forgotten.  Healthcare payer capabilities can roughly be decomposed into eight major categories: 1. e-portals, 2. mobility, 2. sales and underwriting, 3. membership, 4. claim processing, 5. billing and payment, 6. care management, 7. business intelligence and 8. a generic catch all of ‘other support functions.’  Properly defined business capabilities drive future behavior and transform a random collection of projects into strategic portfolios.

Once business capabilities to move the business forward are defined, focus then turns to the technology capabilities which are the enablers.  While technology doesn’t drive business priorities we all can agree that without an integrated digital platform, not much social product integration will occur.  This doesn’t mean web-ify (web service) every function, but the benefit of technology to accelerate business outcomes should be considered every time.

 

Cloud First

There are two parts of a ‘cloud first’ strategy. Part 1 is external and part 2 is internal. The external piece focuses on modularity or packaging pieces of the customer user experience provided to external customers. This may include broker portals, consumer service portals, member portals, client billing, membership enrollment and renewals, claims management, eligibility verifications, B2B gateways (EDI modernizations) and consumer analytics through predictive modeling.  The value here is an externally available service that is governed but encourages your business partners to engage building integration. Simply put, tightly coupled automation and interoperability removes waste and eliminates manual processes that only add to expenses on both sides.

It’s also important to note, we are talking about a platform and delivery systems not a simple one off service, stapled into a existing broken architecture. Often significant long term planning is required to fully realize this benefit.

The internal piece is second and this is about providing services that are internally available for consumption. We are talking about shared services provided to internal customers. Many successful large firms have already implemented flavors of shared service models including: Johnson & Johnson, Kaiser Permanente, MetLife, and Pfizer. Before you write this off as technical babble, just hear me out.  Most organizational processes are between internal-to-internal groups or departments. This is also where the most waste occurs, costing your department time and money.  Time you don’t have and money you don’t want to spend. 

The primary principles of shared services include: price transparency, business management, market responsiveness, best practice proliferation, process standardization and promoting a service culture. Typically, these shared services are delivered by function and separated into transaction-based services and expertise-based services.  Transaction-based services include areas such as human resources, facilities and services, accounts payable/receivable, and information systems.  In contrast expertise-based services include areas such as public affairs, planning/financial analysis, procurement, tax, legal, and risk management.

How tightly is daily work strategically aligned to your teams and organizations, sets the tone of the magnitude of expected change. Pick 3-4 areas that will move your organization from black-box operations to a transparent value-based organization. Value alignment, benchmark services, business capabilities, and cloud first each can make significant value-based contributions for your organizations. Capturing value transforms organizations — efficiency just keeps them afloat a bit longer — step on efficiency, lets find value!

 

Peter Nichol, empowers organizations to think different for different results. You can follow Peter on Twitter or on his blog. Peter can be reached at pnichol [dot] spamarrest.com.

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Peter is a technology executive with over 20 years of experience, dedicated to driving innovation, digital transformation, leadership, and data in business. He helps organizations connect strategy to execution to maximize company performance. He has been recognized for Digital Innovation by CIO 100, MIT Sloan, Computerworld, and the Project Management Institute. As Managing Director at OROCA Innovations, Peter leads the CXO advisory services practice, driving digital strategies. Peter was honored as an MIT Sloan CIO Leadership Award Finalist in 2015 and is a regular contributor to CIO.com on innovation. Peter has led businesses through complex changes, including the adoption of data-first approaches for portfolio management, lean six sigma for operational excellence, departmental transformations, process improvements, maximizing team performance, designing new IT operating models, digitizing platforms, leading large-scale mission-critical technology deployments, product management, agile methodologies, and building high-performance teams. As Chief Information Officer, Peter was responsible for Connecticut’s Health Insurance Exchange’s (HIX) industry-leading digital platform transforming consumerism and retail-oriented services for the health insurance industry. Peter championed the Connecticut marketplace digital implementation with a transformational cloud-based SaaS platform and mobile application recognized as a 2014 PMI Project of the Year Award finalist, CIO 100, and awards for best digital services, API, and platform. He also received a lifetime achievement award for leadership and digital transformation, honored as a 2016 Computerworld Premier 100 IT Leader. Peter is the author of Learning Intelligence: Expand Thinking. Absorb Alternative. Unlock Possibilities (2017), which Marshall Goldsmith, author of the New York Times No. 1 bestseller Triggers, calls "a must-read for any leader wanting to compete in the innovation-powered landscape of today." Peter also authored The Power of Blockchain for Healthcare: How Blockchain Will Ignite The Future of Healthcare (2017), the first book to explore the vast opportunities for blockchain to transform the patient experience. Peter has a B.S. in C.I.S from Bentley University and an MBA from Quinnipiac University, where he graduated Summa Cum Laude. He earned his PMP® in 2001 and is a certified Six Sigma Master Black Belt, Masters in Business Relationship Management (MBRM) and Certified Scrum Master. As a Commercial Rated Aviation Pilot and Master Scuba Diver, Peter understands first hand, how to anticipate change and lead boldly.