Health services leader targets large reductions

Background

A health services leader targeted 25%–35% reductions in claims, commissions and provider/member services as it geared for reform.

The client (a national health plan) recognised a need to position itself in a rapidly evolving business environment. In response, they wished to reduce administrative cost and develop a low-cost model. Their scope included all functions across the front, middle and back office. The business segments that were considered in scope were individual and small-group, up to 100 lives. The client decided to adopt a lower cost structure in these segments by 2013–2014 to address a permanent industry shift.

• Client already used shared services for most functions, complicating the development of a financial baseline and identifying saving opportunities specific to the impacted business segments.
• Market and regulatory forces pressured the client to become nimble and efficient in small-group, individual segments.
• Client wanted assistance to
  • Identify, analyse and quantify potential savings opportunities;
  • Create plans, required investments and timelines to capture the savings opportunities;
  • Develop communication plans for the regional leads; and
  • Install a change and programme management function to oversee implementation.

• Identified and developed a comprehensive set of hypotheses for potential
  savings opportunities.
• Analysed financials across the company and performed a benchmark analysis to understand areas of potential opportunity.
• Interviewed senior leadership team, function leads and other relevant team members across the organisation to test the hypotheses.
• Analysed potential opportunities, quantified benefits and implementation costs.
• Prioritised opportunities, and developed a cogent set of recommendations and an accompanying high-level implementation plan.
• Launched and guided a detail design for the identified savings opportunities focused on the specific functions (product optimisation, sales and distribution, quoting and rating, case installation, member enrolment, billing).