PAINS

   Low enrollment
   Broker management issues
   Low customer retention
   Inaccurate reporting
   Quoting and underwriting delays
   Marketing campaign issues
   Competitor tracking
   Low productivity
   Increasing claims costs
   Increased expenses
   Billing issues
   Profit losses
   Merger difficulties
   Multiple offices and branches
   Internal communications
   Excessive paperwork
   Decrease in service quality
   Other

PAIN DESCRIPTION:

Remember that proverb about the early bird? In sales, timing is everything. The faster you can close a sale, the less chances your competitors have at stealing your client. Quoting and underwriting are complicated processes in the health care industry and involve many factors: customer information, underwriting guidelines and communication between companies, brokers, sales reps, and underwriters.

No wonder such multilayered interactions experience delays. It is important to control at what step the congestion happened and resolve the issues as fast as possible. What could possibly go wrong with your quoting routine?

The most common reasons for delays are:

1. Lack of a synchronized process between sales and underwriting.

• Underwriting and sales do not notify each other immediately when they get new information.
• Underwriting does not have access to the system that sales reps use. They have to contact sales every time they need some minor details about customers.
• Sales department is a mediator between customers and underwriting. If brokers are also involved, then the length of the communication chain doubles.

2. Inefficient gathering of customer information.

• Sales reps request more information from customers than needed by underwriting for the quote. Customers can provide you with basic information fast but it takes them time to prepare more complicated data or pass a medical exam.
• Customers' applications might be incomplete. It takes time to notice missing info since data entry into the system is manual.
• Customers are not contacted fast enough by sales reps about missing data since reps do not have a complete view of their prospects.
• Customers submit a lot of paperwork, which is hard to process and manage, and slow to access.
• Sales reps do not have entry wizards, templates with default values in the system to boost their productivity.

3. Cumbersome manual rating process.

• Underwriting guidelines are not stored systematically in a centralized location. Underwriters do not have access to the most recent changes immediately.
• Underwriting does not receive data from sales reps in electronic format and cannot apply automated filtering/checking for requirements to meet the guidelines.

4. Inefficient data format and data tracking.

• System cannot handle duplicates, e.g. people with the same last names, leading to the confusion of underwriters.
• Dependents eligibility verification is manual.
• System does not help to qualify prospects according to the type of organization (NFPs, sole proprietorships, partnerships, corporations, self-employed).
• System does not support tracking employees by their types (full-time, permanent, part-time, union, non-union, retirees).

5. Delays related to provider input.

• Underwriters require signed Conditioned Authorization form from customers to request an Attending Physician Statement (APS) from a provider.
• Providers do not respond promptly to underwriting requests.

Your organization may have these or less common problems with quoting and underwriting: you are not alone. However, we have discovered several must-know critical success factors we will share with you later in our Solution Audit phase.

PAIN ANALYSIS:

Most insurers request basic company and employee information to get a preliminary rate or price quote, such as:

- company name
- company address
- line of business
- SIC code
- number of employees
- employee census: name, gender, age or birth date
- dependents of an employee
- employer contribution

Additional questions may include maternity coverage, dental insurance, deductibles for hospital stays, etc.

Some health plans require more details: current carriers and benefit design, requested plans, waiting period for new hires, retiree coverage, number on COBRA and Union affiliation, employees who are waiving coverage, employee occupation, hobbies, foreign travel, and smoking. It is often requested that employees pass medical examination, the insurance company may also acquire an attending physician's statement or a report from the medical information bureau. It is important to remember that efficient data gathering can help avoid delays in the quoting process. Many HMOs/PPOs delegate the complete responsibility for data collection on the end customer, thus, wearing out their motivation to subscribe for the health plan.

Many HMOs/PPOs benefit from having a system that makes it easy for a sales rep to contact customers, collect data through the efficient process, easily manage it, and quickly create new customer accounts. Efficient processes help end customers to pass their information to the insurer faster and avoid data loss or misunderstandings.

The Humana Application team managed to improve their customer interaction process through conducting phone interviews with prospects and then transferring them to the underwriting department for a confidential one-on-one interview to discuss medical history. During the interview, the underwriter would determine additional requirements needed to complete the underwriting process. After the underwriting interview is completed, a prospect receives a mailed or faxed application form, signs it, and returns it to Humana.

The application process for Humana One coverage takes less time than is required by most other health insurance companies. Can even this result be improved? Of course, if during phone interviews sales reps and underwriting have access to an easy-to-use, centralized customer relationship management system that is constantly synchronized and gives a 360-degree view of a customer. What is the importance of system accessibility by different types of users? It is faster and easier to make decisions and communicate within one office rather then across multiple locations, and it is more convenient and productive to store information in a central location to avoid delays in communication between sales and underwriting.

Moreover, interactions within the underwriting department can be optimized by utilizing a common library for the rating guidelines and data files, and by having instant access to the most recent changes. Such updates can be managed by a single person and provide uniformity across underwriters.

Health plans are in desperate need of a system that can store contact details specific to their organization, run reports on these parameters, and use them to qualify prospects. For example, having an efficient way to handle employees separately according to their type (full-time, permanent, part-time, union, non-union, retirees, etc.) not only provides a clear and structured view of a customer organization, but also helps underwriters rate them faster. Gain an unfair competitive advantage. An easily customizable system, created specifically for health insurance needs, is a powerful factor in producing your quotes faster, while minimizing their cost.

ADVICE:

Some insurance companies go for online quoting systems, unfortunately, the Internet is not always the best solution to their problems. Not only do these companies expose their rating mechanism and become subjects to the online systems misuse or HIPAA privacy violations, but they also lose their potential customers who do not have much Internet experience. Online quoting tends to work only if it is overly simplified and standardized, and available to a highly-educated buyer or broker channel.

Buying a health plan online does not always offer customers a better deal on premiums, because of strict state regulations and mandates impacting premium levels. And it is hardly a miracle of one-stop shopping.

Having an online quoting system does not eliminate the need for the usual old-fashion quoting procedure. It is much easier to perfect just one routine than two at the same time. Since you cannot move all your prospects to the online quoting, it is definitely worth it to invest in the internal system that can make the quoting process even faster and easier, until your online system is proven.

Accuracy can only be achieved by giving your front-line people an easy-to-use, foolproof system. The cost to create, track, and follow-up on quotes is increasing: these tasks must be automated. Imagine how much eliminating even one piece of paper in the quoting process would save you in a long run.

Comparing direct vs. brokerage close and renewal rates lets you monitor and improve your channel. See the complete picture, sort quotes by Account Executive, and know the status, tier, products, reason, and activity on every quote. You've got the power.

One Demo is better than a thousand words, and one Solution Audit is better than a thousand demos. We encourage you to follow our CRM proverb and take advantage of this opportunity.

Click on one of the three links below to continue your HMOZ research.