Disruptors and changing federal requirements and guidelines are making it a “transform or die” environment for insurance providers and healthcare payers. Companies like Decent, who offer small businesses and solopreneurs healthcare insurance at a significant discount, are seeing investment dollars roll in while also making their members happy. For example, Decent’s Net Promoter Score is five times higher than healthcare insurance company averages.
The good news is that incumbent healthcare payers planning for digital transformation initiatives have a few things that new entrants to the industry do not — a solid base of members, stable revenue, and extensive experience. However, they also have legacy systems and technical debt that must be accounted for. The reality is that traditional healthcare payers have an advantage when it comes to digital transformation, but only if they approach it with people at the center of the change.
This isn’t transformation for transformation’s sake. It sets a purpose for the change — helping the people who interact with your systems, from your own team to the members. However, a successful transformation project may actually require you to take a step back before rushing toward the end goal of innovation.
Discussing human-centered design might seem strange when talking about digital transformation. Certainly, some interfaces will change as a result of transformation projects, but it’s not a driver for these initiatives, right?
Human-centered design isn’t about user interfaces and graphics, although those are both parts of it. Instead, it’s about creating solutions that meet the needs of the humans using the technology. The tech supports the solution’s purpose, and the solution’s purpose is to meet the needs of the people using it.
The benefits of taking a human-centered approach to a healthcare payer’s digital transformation are significant.
The traditional method of solution design for payers was to identify a problem or challenge, spend time creating and documenting requirements, and then spend more time developing the solution. By the time the solution was in the hands of the people who needed it, it could very well be irrelevant. Taking a human-centered approach means starting with what members and healthcare teams want and expect and rapidly creating solutions to their challenges.
Consumers are demanding new ways to access healthcare. They also expect providers and payers to quickly adjust to address health concerns happening today. The healthcare payer that can quickly pivot — say, to offer assistance with COVID-19 care or support telehealth visits — is one that illustrates to consumers that its members are the most important part of their business.
Human-centric solutions for payers aren’t just about the patient. Healthcare providers and their teams are humans who need to work with payer solutions as well. Simplifying the lives of healthcare teams allows them to spend more time and focus on the patient and not on navigating difficult-to-use applications and workarounds.
This approach probably sounds great, but shifting to a human-centric digital transformation plan isn’t like flipping a switch. It requires a change in how you approach transformation and even strategy itself.
At its core, digital transformation is about being nimble and responsive. That goes far beyond technology to business culture and process. Take the COVID-19 pandemic as an example. Moving quickly to account for COVID-19 care and treatment and later vaccinations required systems changes to accommodate these new codes and requirements.
It went beyond that, though. As consumers avoided going to see providers, telehealth became a prevalent means of care. Telehealth claims skyrocketed in April of 2020. But, more importantly, the widespread use of telehealth over the last year has leapfrogged its use by consumers. As of February of 2021, consumers were still using telehealth services 38 times more than they were before the pandemic.
Payers must plan their digital transformation strategy to support a constant re-evaluation of strategy and solutions. We call this “continuous strategy,” and it requires both organizational changes that support review and re-evaluation of strategic goals and solutions, as well as the underlying technology that makes that level of agility possible.
That doesn’t, however, mean jumping to the end of your transformation, which is the mistake we commonly see, and one that frequently leads to failed digital transformation projects. Instead, there is a three-step path of improvement that a transformation should follow that will make rapid, scalable, flexible, and agile changes possible. We refer to it as the S-curve of Digital Transformation.
The first step is to optimize the architecture you already have. This may seem counterintuitive when you are trying to transform, but in reality, you can’t leap forward if you’re weighed down by your legacy systems.
As Mike Deittrick, DMI’s Chief Marketing Officer and President of the AI & Analytics Group, puts it, “(Companies are) not able to match the shift that’s going on because they’re being held back by their legacy business. Fortunately, digital optimization can help you beat industry disruptors at their own game.”
Once existing systems are optimized you can begin to bring in new technologies to help meet your business goals. For instance, a payer might optimize their member data stores and then build a cloud-based API so that the optimized data can be readily accessed by healthcare providers.
On the backside of the S-curve is innovation. This is where you become the disruptor, the driver of change within the healthcare insurance industry.
It can be difficult to tell where you are on the S-curve of Digital Transformation on your own. Bringing in an experienced partner who is familiar with both the stages of transformation and modernization in the insurance and healthcare industries can accelerate the change you’re looking for.
Digital transformation is already an intricate dance between technology optimization and cultural and process change within an organization. The first important step is to understand that it’s not a one-and-done type project, but an iterative change that occurs across the entire business. Achieving a human-centered approach to your transformation requires first re-centering your business strategy and product development on people, and allowing the technology to follow in a structured but incremental fashion.
If you’re looking for help in achieving a lasting and successful digital transformation project that meets the needs of your members and keeps you competitive in the marketplace, contact DMI. We’ve helped some of the largest insurers in the world reinvent their businesses to take advantage of continuous strategy and digital transformation.