Blogs & ArticlesTaking a Closer Look at The Importance of Faster Health Claims Processing.

September 20, 2022

Claims, in the health insurance sector and otherwise, is often hinted at as the moment of truth for policyholders. It is the moment where the calculated risk of an insurer meets the unfortunate, unplanned healthcare requirement and/or emergency in the insured person’s life. Hence, it becomes important to provide a speedy health claims process that is not characterized by any slip-ups.

Health claims is also a notable period of time where the relationship between the customers and the insurance company plays out. This touchpoint can outdo all the other parts of the insurance journey for a customer.

For instance, you may have a wide range of insurance products suitable for a customer that can impress them a great deal. However, if the claims experience turns out to be slow and negative, it can drive the customer away from your business to competitors.

So, a speedy, customer-centric claims process is essential for insurance companies. Now, it’s time to dive deep into the importance of faster claims processing.

Being Fast Means Being Better. Why Is That So?

According to a survey by Accenture, about 95% of policyholders rated speed of settlement as their top factor for satisfaction. A faster health claims process ensures the policyholder person gets what is rightfully deemed appropriate to restore normalcy at the right time. In this way, the policyholder gets compensation for the damages and losses. Plus, it can be less expensive for the customer.

How is Faster Claims Processing Beneficial for the Provider?

Firstly, faster claims processing can increase efficiency and decrease the cost of operations. In addition to reducing the operating costs, it can reduce claims leakage and severity.

As policyholders prefer faster and more effective claims processing, it is important to provide them with what they are looking for. This way, insurance companies can improve customer satisfaction, increase customer retention, and count on references for new customers.

1. A Faster Health Claims Processing Increases Efficiency

Focusing on faster claims encourages improvement of claims management system, which will in turn, improve the overall efficiency of the system. A sophisticated claims management system simplifies the entire process of claims management for all the parties involved – the policyholders, insurance companies, and the empanelled hospitals.

Manual and time-consuming claims processing are becoming the thing of the past since insurance companies and TPAs are leveraging the advanced solutions offered by Insurtechs. The technology offered by these solutions include standardization and benchmarking of medical cost, an intuitive UI-driven business rule engine, and OCR for digitization of claim bills.

Furthermore, reducing the claims cycle time allows insurance companies to dedicate more time and resources towards other projects in areas such as customer experience improvement, innovative projects, and other opportunities that help in revenue generation.

2. Lowers Cost of Claims

With minimized claims cycle time, the cost of claims also decreases. A focus on faster claims processing enables more efficiency (as discussed earlier) as well as reduces the cost of claims. A well-planned and designed claims management system reduces the cost of claims for insurance providers and policyholders.

According to McKinsey, an intelligent health claims management solution can improve TAT significantly. This can further, reduce the cost of claims by 25% to 30%. One other way, improving the speed of claims cycle time reduces the cost of claims is by minimizing the chances of errors that are prevalent in manual and other outdated methods.

3. Expedition of Settlement for the Better

It is in everybody’s best interest to pay out benefits, settle the claims amount, and close the case without any deferment. Once the claims adjudicator checks the claims request for its accuracy and completeness, and if the healthcare services are covered under the policyholder’s plan, it is best to release the agreed-upon payment as soon as possible.

The sooner the payment is disbursed, the easier it will be for the policyholder to get back into their normal day-to-day life. This will leave a positive impact on the policyholder about the insurance company.

In addition to improving customer relations, the expedition of settlement diminishes the chances of extended litigation. It will also decrease the chances of any last-minute changes that may complicate the entire process that can be cumbersome for the customers as well as the insurance company.

4. Customer Retention and Acquisition

According to a survey by Ey, nearly 87% of policyholders reported that the claims experience impacts when deciding if they want to remain with the current insurance provider or not.

Customer satisfaction is vital when it comes to retaining existing customers and acquiring new ones. Even the smallest chunk of dissatisfied customers is a business risk since losing one customer because of bad experience can hurt your overall customer base.

Every communication between an insurance company and the policyholder is crucial. However, the importance of seamless claims process is crucial to constructing a stronger bond with a customer.

Final Takeaway

To improve speed, efficiency, and customer retention, insurance companies need to start having a swift and well-organized claims management process and systems in place. They can reach a point of perfection by evaluating their existing practices, identifying bottlenecks and gaps and rectifying them.

Insurance companies and/or TPAs can partner with insurtechs like iNube and enhance the health claims processes. iNube’s CLAIMSLive Health digitizes every step in the health claim processes. It automates coverage validations, and tariff verifications and fast-track the claim adjudications.

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