Legacy systems are gradually becoming the thorn in the side of revenue management for health payers.
Research shows that healthcare payers had to spend $1.37 billion in 2019 as the highest total rebate amount since the MLR rebate program began. These companies are coming under increased pressure to demonstrate stronger value, provide personalized service and convenience, improve client engagement, and increase price transparency.
However, with legacy systems in place, these can be hard to achieve.
Here’s a look at how legacy technologies can hurt healthcare payers.
Impede agility to create competitive differentiation
Healthcare payers need the agility to evaluate market demands, determine what benefits would appeal to their current and prospective members, and provide the same with greater incentives and benefits. They also need to have the capacity to configure prices quickly while optimizing their costs and margins.
Legacy technologies do not allow such flexibility as they are hardcoded. Hence, they impede an organizations’ ability to remain flexible and agile to create competitive differentiation.
Challenges in payment and billing flexibility
In today’s competitive business landscape, healthcare payers need more flexibility to improve business outcomes and increase profitability. For this, they must expand their capability to provide flexible provider payment options like in performance bonuses. They also need to provide flexible and modern billing options to their members. This might need minute customizations and could demand nuanced options like allowing for preferred payment dates.
These functions need end-to-end solutions that remove silos, provide greater transparency into core business functions, and connect them seamlessly. Legacy technologies fall flat here owing to their siloed nature, lack of flexibility, and integration challenges.
Challenges in revenue cycle optimization
Healthcare payers, like all other industries, are also interested in identifying opportunities to improve business outcomes, weed out inefficient processes, and eliminate waste.
They want to create a high-performing revenue cycle.
However, this can only be achieved by leveraging data analytics. For this, they need to connect all the data sources and ensure that they can easily monitor, cleanse, and synthesize the gargantuan volume of data that flows across the entire organization.
Expecting to do this with hardcoded legacy technologies is a wasteful effort because of the siloed nature of these technologies. Time spent on systems engineering, maintenance, etc. is much higher because of the complexities of legacy technology. These technologies also do not have the flexibility that businesses need for load streaming and batch data processing while supporting simultaneous queries.
With limited computing abilities of legacy technologies, things like predictive analytics are held back. That impedes payers’ abilities to explore new growth avenues, identify business drivers, evaluate consumer patterns, identify correlations between client data and preferences, identify high-demand instances, or respond faster to market changes.
Lacking 360-degree customer view
Having a 360-degree customer view is a business imperative for all industries and organizations. Healthcare payers are no different.
Healthcare payers need scalable integrated systems to understand customer behaviors, relationships, and all the influencers. They need the capability to provide personalization and price and billing customizations and ensure a positive customer experience. A 360-degree view of the customer helps identify cross-selling and upselling opportunities to improve revenue outcomes.
Legacy technologies, unfortunately, do not allow such integrations and connections. They don’t support data to flow freely across systems, departments, and processes and, hence, cannot provide transparent insights that are crucial for the business.
Legacy technologies also have bigger infrastructure and maintenance demands and simply are not built for business scalability and growth.
To navigate today’s complex business landscape, healthcare payers need access to modern-day technologies revenue management systems powered by technologies like AI and Machine learning. Such modern systems can help them improve customer engagement, increase competitiveness, eliminate waste, and improve outcomes and profitability.
