Health Insurance Is About Risk Management: Health Plans Need to Manage Process Risk Too

It’s ironic. Health insurance is the contractual transfer of risk from the insured to the insurer. This risk is transformed and managed by the insurer through a variety of technical, administrative. and financial means. But if you take a course in insurance underwriting, one area that’s not often addressed is process risk: Probability of loss inherent in business processes. Process risk is sometimes called operational risk, “resulting from breakdowns in internal procedures, people and systems.”

I think this is highly ironic! Insurance is in the business of concentrating and managing risk. But it does not always use the kind of information technology that can dramatically reduce the risk of internal procedures, people, and systems breaking down. What kind of tech am I speaking of? Modern Business Process Management.

A colleague of mine, Mike Ingrisano, wrote a great blog post titled An Application Platform Approach for Compliance and Risk Management in which he said:

“Organizations must align strategies in order to meet regulatory guidelines to reduce operational risk. Businesses of all different types cannot afford process error and data breaches, which has led to large investments to secure data and assets.

Now, combine the fast-paced world of digital business and access to new sources of data, and organizations find themselves investing even more in compliance management.

Forward looking companies are using the best of enterprise IT software to adopt applications that use defined workflows, fixed business rules and process automation to establish solutions that enable the most accurate and safe compliance monitoring to mitigate risk.”

I couldn’t put it any better. But, in the rest of this series of reasons for health plans to “double-down” on Business Process Management, I will try!

P.S. By the way, back when I was a pre-med Accountancy major (more on that in a later post in this series) we did cover insurance accounting and actuarial approaches to insurance underwriting. Plus, during my masters in Industrial engineering, we covered optimization of stochastic systems, some of which are used today to estimate future healthcare and derive necessary premiums! A great book, if you’re interested in this sort of geeky health insurance topic, is Health Insurance: Basic Actuarial Models

10 Reasons Health Plans Should Double-Down on Modern Business Process Management

Accelerate Development of Innovative Customer-Centric Mobile Health Plan Products

In every industry, and especially in health insurance, there’s enormous pressure to more rapidly create innovative customer-centric mobile access to reengineered enterprise workflows. This, to reduce costs and increase customer engagement and health plan revenue.

Health plans have long be stuck between a rock and a hard place, when it comes to products and services based on information technology. Either you buy prepackaged software from someone who promises to solve your problems, or you hire programmers to create new applications from scratch. In the former instance, you’re stuck with whatever rate of innovation and compatibility your vendor allows you. In the later case, you can create exactly what you need, but only at great expense. And then, when requirements change, it costs an arm and a leg, to modify, if it can even be substantially modified at all.

Keep in mind this is a very different style software solution. It’s not buying someone else’s preexisting software and it’s not writing software yourself using a third generation language such as Java, C#, etc. (both of which I love, don’t get me wrong). It’s creating exactly the custom workflow-smart/work-smart workflow application you need, but doing so in what is called a “low-code” approach, so you can create and change quickly.

I have experienced this difference first hand. A couple years ago a BPM vendor and I developed a prototype hospital environmental services task management app. It combined Google Glass with their low-code app creation capability. I described what the app needed to do; they drew it on a white board.


A week later they showed the completely functional prototype. Wow! I asked to see its workflow in the process designed and they showed me this.


Now, I’ve designed apps in a variety of workflow management systems and BPM suites, but I was still impressed with how fast they were able to turn round that fully functional prototype. I hope you’ll read about it. It did some pretty cool things.

The very best and most articulate explanation of how important low-code BPM apps are to customer engagement comes from Clay Richardson.

10 Reasons Health Plans Should Double-Down on Modern Business Process Management

Systematically Improve Health Plan Member Customer Engagement With New Products

A major sweet spot for companies today — to both shave costs and increase customer engagement — is to externalize internal enterprise workflows via combination of cloud-based social and mobile workflow tech. When I speak of customers, I’m not just speaking of insured (potential) patients. I include providers, employers, and brokers, and even other stakeholders such as health plan employees and fraud, waste, and abuse investigator. In fact, the entire of notion of customer-facing, self-service portals will expand, eventually, to include everyone who is a customer, which is everyone, even internal health plan customers.

By “portal”, I don’t mean a website. Increasingly portal access is via native mobile apps. Modern Business Process Management applications, built by drawing workflows and customizing forms, without traditional programming in 3rd generation languages such as Java and C# is the key to rapidly creating and testing and improving new mobile health plan products to a wide variety of external and internal customers.

If you can’t find what you want or need out there among prepackaged software offering… If you’re intimidated by the thought of creating your own software solution the old-fashioned way… Really get close to and understand your customers and create new health plan products and services using a new-fashioned, low-code workflow and work platform….

… Such as the Appian BPM Work Platform. Come by to talk shop about healthcare workflow and workflow technology, and see how easy it is to quickly draw and execute native mobile app access to enterprise data and workflow.

10 Reasons Health Plans Should Double-Down on Modern Business Process Management

Integrate Clinical And Financial Health Plan Systems to Provide Unified View Of Data And Workflow

I have an unusual pre-med major. Straight As in the number one ranked Accountancy program in the world (University of Illinois, Champaign-Urbana). I was also working on a masters degree in Industrial Engineering, focusing in usability and workflow.

I can still remember a giant light bulb going off over my head, during my first year of medical school. To maximize quality and minimize cost health IT needs to better integrate clinical and financial information systems.

At the time, in those early days, this was just an idea. There were no such systems. The clinical and the healthcare financial domains were complicated enough, and there wasn’t even the infrastructure across which to communicate. This lightbulb idea seemed like a pipe dream.

Today, of course, many people have had this idea, and there are many products and services aiming to bridge this traditional divide. I’ve been tracking the evolution for decades. There is no better single technology for integrating clinical and financial data and workflow than modern workflow technology.

This integration requires interoperability, for sure, but a special kind of interoperable above and beyond traditional notions of sending and decoding a message. It requires what I call workflow interoperability, also sometimes referred to as pragmatic (term from linguistics) or task interoperability.

Modern BPM has many sterling qualities, including the ability to rapidly prototype and then deploy mature products and then to continue to change and improve those products…. Including more useable user interfaces, because all and only data and options relevant to each step of a workflow are shown to each users… But modern BPM is also used, though mostly outside healthcare so far, to integrate wide varieties of legacy enterprise systems based on disparate technologies. If that doesn’t describe a crying need in health IT, I’ll eat my BPM hat.

“Spider in the web”! Connecting disparate systems and technologies? Need sound familiar? Healthcare IT!

SOAP, email, JMS (Java Messaging Service), SQL, REST, (and bunch of enterprise systems): sound familiar? It should remind you of what are called interface or integration engines in health IT. However, modern BPM application platforms are different, and in my mind, better, in an important way: they have customizable user interfaces. This is the task interop, pragmatic interop, workflow interop layer that is so, so, immature in much of today’s health IT. Of course, if you want to create your own UI apps, you can, because you can call into BPM platforms and return both data and workflow state (something else that is missing in a lot of health IT today).

10 Reasons Health Plans Should Double-Down on Modern Business Process Management

Maximize Health Plan External and Internal Workflow And Process Transparency

“Transparency” is the rage these days in healthcare. As well it should be! Transparent prices. Transparent costs. Transparent governance. But I’m going to talk about transparent processes and workflow. I’ll talk about transparency in two senses, at “design time” and at “run time.” Design-time is when you are designing software. In the old days, and still to some extent today, for specialized applications, design-time was when you typed code into the programming code editor. Run-time was when you executed that code and observed its behavior. If it didn’t run, or if it did but behaved badly, you’d go back to design time, find the problem (debug) and then enter run-time again, to see if you improved the situation.

Another phrase that means basically the same as process transparency is workflow visibility. About which I’ve given an entire 45 minute webinar. I cover the topic with respect to clinical tasks, not health plan tasks, but the underlying concepts are the same. (Plus, in terms of the underlying IT infrastructure, clinical and health plans tasks do increasingly overlap these days, especially in the area of the medical management function.)

You can think of a workflow system (an informal phrase I use that include BPM) as a collection of tasks and these tasks having states: pending, started, postponed, reassigned, escalated, cancelled, completed, etc. When a task is completed, other task may be automatically started, assigned to users, or roles (collections of user, anyone which can complete the task). Moment-by-moment all tasks and all task states can be displayed. If you’ve never used a workflow system, you have no idea how valuable such a display is to preventing even the possibility of someone dropping the ball, so to speak, with result of languishing task (and an increasingly pissed customer).

Consider what we’ve covered so far: rapidly creating new products, pulling together legacy data & workflow, and then being able to literally watch all tasks flow through the system. In addition to see what tasks are in what states, just think of the extraordinarily detailed time-stamped analytics, so you can retrospectively find and eliminate bottlenecks and rework (but that’s a design topic, or, should I say, a re-design time topic, I’ll address more later).

Finally, transparent processes and workflows lend themselves to “externalization” by the health plan. Feed these tasks, and ability to check on their status, to mobile apps used by customers is a great way to save money and increase engagement. Done right, of course!

10 Reasons Health Plans Should Double-Down on Modern Business Process Management

Enable Health Plan Workflow And Process Change Necessary For Accountable Care

Health plan IT systems undergo three kinds of change: information accretion, system tuning, and structure transformation.

Information accretion is simply the addition of new rows of data in databases or XML files in XML based systems. In human terms, it’s like learning new phone number one day or a new joke the next.

System tuning is the gradual increase in performance, such as speed and accuracy that occurs over time. Users tweak settings, create shortcuts, and get faster themselves at use of the system through practice. One of my favorite stories about practice is the psychologist who studied eighty year old cigar makers in Miami, who started when they younger then ten years old. He measured speed and consistency. Guess what. They were still improving! Something like that happens with the “cognitive systems” we create out of combining software and people. In often cases, even badly designed software can gradually become better over time, as folks find tweaks and workarounds and themselves compensate for system design flaws.

What about structural change? That indeed is the hardest. Over time, you learn more and more facts, you get faster and more accurate, but every once in a while, old ways of doing things are no longer sufficient. The world has changes but you have not. At this point you can still in your heels, or you begin the painful job of question fundamental assumptions, in effect, attempting to redefine yourself. IT systems are a lot like this. The “structure” of an IT system is in its database structures (models) and workflow structures. Changing database models is difficult, but it generally well understood in health IT. However, workflow is a very different animal. Many health plan workflows are essentially hardcoded in if-then and case statements in 3rd generation languages such as Java and C#. Have you heard the old joke about how many programmers does it take to change a lightbulb? Only one, but in the morning your toilet and stove are broken. Changing workflow requires changing software and changing software is difficult, expensive, and dangerous.

Unless! Unless workflow is coded using high-level models of workflow, that humans can understand, but which can still be executed by workflow engines. That is modern BPMs give to software development. It is much easier to change software systems after they’ve been designed and deployed, because, essentially, they don’t have to be recompiled, retested, etc.

Take a look at one of my most popular blog posts, A Litmus Test for Detecting Frozen Workflow.

10 Reasons Health Plans Should Double-Down on Modern Business Process Management

Harness Social, Mobile, Analytics, Cloud-Enabled Health Insurance Application Development Platforms

Healthcare is like a very large insular country that’s been closed off from the rest of the world for a long time but now it’s opening up. The same forces that are affecting many other verticals, such as social, mobile, analytics and cloud, particularly, are also affecting healthcare. This is sometimes portrayed as an almost a perfect storm. We need to be come more social. We need to become more mobile. Etc. But how, given limited resources and creaky old legacy enterprise tech, can we possibly do go in all these directions at once?

These technologies and these new industries, if you look under the hood, often the most successful platforms have workflow automation, workflow engines, the ability to draw out a workflow or to systematically improve the workflow with the data, possibly big data.

What if I told you that there was an application platform that dramatically reduces time to market, talks to your back-end systems, and has a much better user experience than traditional health IT? Oh, one more thing. Well, actually, four more things. Applications created on this platform automatically leverage social, mobile, analytics and cloud. That’s a modern Business Process Management application platform.

Those folks you hire who are already used to Facebook/Twitter style activity stream user interfaces? That’s the UI to this BPM application platform. (Plus it can appropriately consume and generate public social media content, while securing sensitive content which much be secured.) Mobile? Design your application by drawing workflows and forms. Then push a button, to generate cross-platform and native mobile apps. Analytics, especially time-stamped analytics, so important to find and eliminating bottlenecks, workarounds, and rework, are build into a wide variety of dashboards and key performance indicators. Finally, cloud. You chose. Public or private.

10 Reasons Health Plans Should Double-Down on Modern Business Process Management

Bring Modern BPM’s Unique Value to Member, Provider, Medical, Benefits, and Claims Management

Modern BPM application platforms are highly relevant to every traditional area of health insurance payer IT. In fact, as a refresher, and to highlight every instance of payer IT process-aware opportunity with a yellow marker, I just took both courses AHIP Education offers on payer IT. Every category…

  • Membership Management
  • Provider Network Management
  • Claims Processing
  • Benefit Plan Management
  • Medical Management
  • Fraud, Waste, & Abuse

… evidenced effects of diffusion of the kind to workflow tech I’ve been advocating generally in healthcare for years (technically, decades, though just barely). Here I will just focus on one area: Claims processing.

I hope you’ll watch this 20-minute video of how Serco stood up a claims operation in a remarkable short of time, and then processed daily claims volume that literally caused exclamations in the audience around me.

The Agility Imperative An Affordable Care Act Case Study

  • 695,000 running processes (workflows)
  • 2000 concurrent users
  • 125,000 tasks in single day
  • over two million documents stored
  • 27 releases in 18 months (27 times system improved)

Impressive, but the following, in the context of the former, is what made the collective audience jaw drop…

The Federal Government awarded the contact July 1, 2013, with a go-live date of October 1st, 2013 (no, not 2014).

Keep in mind, Serco is NOT an IT services organization. It’s a business services organization. Serco used BPM consultants, but ultimately only needed one FTE to run the BPM system making this remarkable claims-processing throughput figures possible.

The following isn’t claims processing, it was said in the context of provider network management, but it’s certainly worth including here. This is what a Vice President of IS Strategy and Shared Services had to say:

(compressed a bit, because I had to get it to fit into a tweet)

A modern BPM application platform will

  • aid provider transformation and
  • change care management to
  • achieve network excellence

Look for more examples, on this blog, of the dramatically positive implications of modern BPM application platforms for every aspect of health plan and payer IT.

10 Reasons Health Plans Should Double-Down on Modern Business Process Management

Leverage Modern BPM for Health Plans in the Regulatory and Compliance Space

Every year I search every website of every HIMSS conference exhibitor. I did the same for every AHIP exhibitor website (150+).

Specifically, I search for healthcare workflow and workflow technology related terms (process maps, customizable workflow, workflow engine, process orchestration, business process management, etc.). This search of workflow tech is occurring across almost every category of healthcare information management and IT. And compliance is one of the most prominent categories represented.

The following two-minute video lays out concisely the main advantages for BPM: adapting to, even exploiting, the absolute necessity of complying with a changing regulatory environment.

First of all, regulations change day-to-day, week-to-week. Many new regulatory concepts, especially in healthcare start out under specified. Any assumptions you make, and you have to make a lot, will likely have to change. Traditional, not process-aware application platforms have relatively frozen workflow and logic. But not modern BPM. Workflows and rules can be changed, without have to go back to programmers to make those changes in computer code.

Second of all, the regulatory compliance logic can be inserted directly into day-to-day workflows. So, instead of doing a bunch of work, say processing a pile of claims, and then running some of them through a compliance check, the regulatory logic is actually part of the workflow. This dramatically reduces duplication of effort and resources.

10 Reasons Health Plans Should Double-Down on Modern Business Process Management

Turbocharge Health Plan Operational Processes With Same BPM So Successfully Used In Other Industries

While no longer amazed, I am still amused, when I see job ads for C-level positions requiring NO healthcare experience. Hospitality and aviation come to mind, as industries healthcare organizations and consultants travel to return with great ideas and technologies. One idea and technology that has been widely adopted in most other industries, but not much yet in healthcare, is Business Process Management. I’ve been tracking diffusion of workflow tech, now called BPM, into healthcare for two decades. It’s very much an example of the famous Gibson quite, “The future is here, it’s just not evenly distributed.” Take a look at some of the remarkable statistics achieved by non-healthcare organizations at the recent Appian World conference I attended.

(I don’t think I need to read/type you the slides. If you need to, just click on each to enlarge.)

To sum up this series of 10 reasons why health plans should double-down on modern BPM, take a look at this survey of attendees at a webinar on BPM. I call it a have-your-cake-and-eat-it-distribution. These folks, from a cross-section of industries, were interested in BPM because it promises to allow them to create apps for quickly AND change those apps easily AND integrate those apps with back end enterprise systems AND improve user experience.

Exactly where health plan payer IT needs to go too!

Process-aware modern Business Process Management is really a paradigm-shift. Health plans, health insurers, health payers, are already early adopters of BPM (compared to healthcare and health IT generally). It’s time to double down. To exploit these early successes by pivoting to even more mission critical AND customer engaging new health plan products and services.

10 Reasons Health Plans Should Double-Down on Modern Business Process Management