Five Emerging Strategies for Healthcare Claims Processing in 2024

Seems like every time I meet with a health plan or administrator in recent years there is a common theme when it comes to claims processing: the ever-constant need for amending and maintaining systems to comply with business needs or regulations is expensive, resource intensive, and comes with substantial risk. It usually starts out sound something like this, "We need to improve our capacity for changes in order to keep up with business demands.” Does this sound familiar? 

In the ever-expanding and evolving landscape of healthcare, insurance executives face a constant battle when it comes to claims processing. From managing rising healthcare costs to meeting regulatory requirements, these executives are constantly adapting to changes coming from many directions.  

Nearly every change that occurs in plan designs or rules from regulators requires a new adaptation to processing claims. It is no surprise that backlogs in IT pile up and innovation projects take a back seat to this insatiable demand.  

From a consumer standpoint, this is felt in the form of denied claims and extensive, often frustrating, pre-approval processes. Speaking for myself, whenever I had an interaction with an integrated delivery network over the last 20 years, it has (for the most part) improved each time. However, we still have a long way to go. 

In this blog post, we will level set with the top challenges currently in front of health plan executives in claims processing and the innovative trends that are helping them adapt, improvise, and overcome. 

Challenges Affecting Claims Processing 

Regulatory Compliance

The healthcare industry is heavily regulated, and insurance companies must adhere to a myriad of federal and state regulations. Staying compliant with ever-changing rules and requirements is a daunting task.  

Take for example the 2022 Notice of Benefit and Payment Parameters (NBPP) issued by the US Department of Health and Human Services (HHS), and the Department of the Treasury rules and regulations related to the implementation of the Affordable Care Act (ACA) and the health insurance marketplaces/exchanges¹. Some of the changes included: 

Escalating Healthcare Costs

One of the most significant challenges insurance plan executives face is the relentless rise in healthcare costs. This not only strains the finances of insurance companies but also puts pressure on premiums paid by policyholders. Changes in regulations play a significant role in this, as do rising drug costs, an aging population, and many other factors. To address this challenge, administrators are always looking for opportunities to contain costs without compromising the quality of care. 

Data Security and Privacy

Insurance companies handle vast amounts of sensitive patient data. With the increasing frequency of cyberattacks and data breaches, protecting this information is paramount. Ransom attacks are on the rise and some organizations have paid a steep price for often small missteps. Healthcare executives must prioritize cybersecurity measures to safeguard their customers' data and maintain their reputation. 

Administrative Complexity

Claims processing can be administratively complex, involving multiple stakeholders, paperwork, and communication channels. It is not unusual for changes to take effect contractually or by mandate and to see a several-month delay in compliance with them. In many cases things that slip through the cracks go unnoticed until enough of an anomaly shows up that a settlement is negotiated or fine is paid. Reducing administrative inefficiencies is a constant challenge for executives aiming to streamline the claims process, minimize errors, and improve customer satisfaction. 

When we zoom-in on the impact from each cost increase, data breach headline, denied claim, or erroneous transaction slipping by, it reveals a source of both erosion in the public trust and cataclysmic impacts to consumer confidence at an individual level.  

Top Trends for Solving These Challenges 

A customer-centric approach is emerging as a competitive advantage in the insurance industry. Health plan executives are focusing on improving the customer experience by offering personalized services, simplified claims processing and easy-to-use mobile apps, enhancing customer satisfaction and loyalty. 

These trends all have an underlying technology theme, which reminds me of a study published by Deloitte in 2022 (Digital Disruption for Health Plans: It isn’t coming, it’s here.). The report described digital disrupters entering the market to capitalize on the value missed by legacy insurance providers. It is estimated these entrants will take upwards of 26% from health plans' net profits by the year 2030. Their success relies on streamlined reimbursement and producing results for their investors and customers. Any way you look at it, this puts even more stress on costs to administer claims and a high value on nimble solutions.