Claims Processing and Adjudication: How Call Centers in the Philippines Are Transforming Insurance and Healthcare Back-Office Operations

Claims processing and adjudication is a complex and mission-critical function for both the insurance and healthcare industries. It is the process of reviewing and evaluating claims to determine whether they are valid and should be paid. The accuracy and efficiency of this process has a direct impact on customer satisfaction, profitability, and regulatory compliance. However, for many companies, claims processing can be a significant cost center, and it can be a challenge to attract and retain the talent needed to run a world-class claims operation. This is where claims processing outsourcing to the Philippines comes in. By leveraging the country’s large pool of highly-skilled and experienced claims processors, companies can transform their claims operations from a cost center into a strategic asset.

According to a report by Grand View Research, the global claims processing services market is expected to reach $134.6 billion by 2028. This growth is driven by the increasing complexity of the insurance and healthcare industries, the growing demand for cost containment, and the need for greater efficiency and accuracy in claims processing. The Philippines has emerged as a global leader in claims processing outsourcing, with a long history of providing high-quality services to some of the world’s largest insurance companies and healthcare providers.

The Unique Challenges of US Healthcare Claims

The US healthcare system is notoriously complex, with a dizzying array of payers, providers, and plans. This complexity creates a number of unique challenges for claims processing, including:

• A multitude of coding systems: The US healthcare system uses a variety of coding systems, including ICD-10, CPT, and HCPCS, to describe medical diagnoses and procedures. This complexity can lead to errors and inconsistencies in claims data.

• A fragmented payer landscape: The US has a fragmented payer landscape, with thousands of different insurance companies, each with its own set of rules and regulations. This makes it difficult for providers to keep track of the different requirements and to submit clean claims.

• A constantly changing regulatory environment: The US healthcare system is subject to a constantly changing regulatory environment, with new laws and regulations being introduced on a regular basis. This makes it difficult for providers to stay up-to-date on the latest requirements and to ensure compliance.

These challenges can lead to a number of problems, including claim denials, delayed payments, and increased administrative costs. For example, a recent study by the Kaiser Family Foundation found that 1 in 5 in-network claims are denied, and that the average cost to appeal a denied claim is $118.

How Philippine Providers Are Addressing the Challenges

Philippine BPO providers have developed a number of strategies to address the unique challenges of US healthcare claims. These include:

• Specialized Training: Providers invest heavily in specialized training to ensure that their claims processors have a deep understanding of the US healthcare system, including the different coding systems, payer rules, and regulatory requirements.

• Technology-Enabled Solutions: Providers use a variety of technology-enabled solutions, such as AI-powered coding tools and rules-based claims editing software, to improve the accuracy and efficiency of claims processing.

• A Focus on Quality: Providers have a strong focus on quality and have implemented a rigorous quality assurance process to ensure that all claims are processed accurately and in a timely manner.

By leveraging these strategies, Philippine providers are able to help their clients to navigate the complexities of the US healthcare system and to achieve significant improvements in their claims operations.

Philippine call centers have evolved far beyond their traditional role as providers of voice-based customer service. They have become sophisticated BPO providers with deep expertise in a wide range of back-office functions, including claims processing and adjudication. They have invested in the latest technologies, such as robotic process automation (RPA) and artificial intelligence (AI), to automate and streamline the claims process, and they have built a large and highly-skilled workforce of claims processors, medical coders, and other subject matter experts.

The benefits of outsourcing claims processing to the Philippines are significant. In addition to cost savings of up to 50-70%, companies can also achieve significant improvements in accuracy, turnaround time, and compliance. They can also gain access to a level of expertise and technology that would be difficult and expensive to replicate in-house.

The Importance of Accuracy and Timeliness

Accuracy and timeliness are the two most important metrics in claims processing. An inaccurate claim can lead to overpayment or underpayment, both of which can have significant financial consequences. A delayed claim can lead to customer dissatisfaction and regulatory penalties. According to a study by the American Medical Association, 30% of all medical claims are denied on the first submission due to errors.

By outsourcing claims processing to a specialized provider in the Philippines, companies can significantly improve the accuracy and timeliness of their claims operations. Philippine providers have developed a rigorous quality assurance process that includes a combination of automated and manual review to ensure that all claims are processed accurately and in a timely manner.

“I’ve seen companies leave millions of dollars on the table because of inaccurate and inefficient claims processing. It’s a silent killer of profitability. The best way to avoid it is to treat claims processing as a strategic priority. That’s why outsourcing claims processing to a specialized provider who can deliver both accuracy and speed is one of the smartest investments a company can make.” – Ralf Ellspermann

Building a High-Performing Claims Processing Team

Creating a high-performing claims processing team requires a unique combination of talent, technology, and process excellence. Leading Philippine providers have developed a set of best practices in each of these areas.

Talent is the foundation of any successful claims processing operation. The Philippines has a large and growing pool of highly-skilled and experienced claims processors. Many of these professionals have a background in nursing, medical technology, or other healthcare-related fields, which gives them a deep understanding of the complexities of medical claims. Providers also invest heavily in training and certification to ensure that their claims processors are up-to-date on the latest industry regulations and best practices.

Technology is a key enabler of efficiency and accuracy in claims processing. Leading providers have invested in a wide range of technologies, including claims processing platforms, RPA, and AI. These technologies are used to automate manual tasks, reduce errors, and provide real-time insights into claims performance.

Process excellence is the glue that holds it all together. Leading providers have developed a set of standardized and optimized processes for each of the claims processing workflows they support. They use a variety of tools and techniques, such as Six Sigma and Lean, to continuously improve their processes and to ensure that they are as efficient and effective as possible.

Case Study: Transforming the Claims Operations of a National Health Insurer

A national health insurer was struggling with the cost and complexity of its claims operations. The company had an in-house team of 500 claims processors, but they were struggling to keep up with the volume of claims. The error rate was high, and the turnaround time was slow. The insurer decided to outsource its claims operations to a Philippine BPO provider.

The BPO provider implemented a solution that included a dedicated team of 1,000 claims processors who were responsible for all of the insurer’s claims processing, from receipt to payment. The provider also implemented a new, AI-powered claims processing platform that was able to automate many of the manual tasks associated with claims processing.

The results were transformative. The insurer was able to reduce its claims processing costs by 50% and to improve the accuracy of its claims processing by 98%. The turnaround time for claims was reduced from 30 days to 7 days. The insurer was also able to improve customer satisfaction, as claims were processed more quickly and accurately.

The success of the engagement led the insurer to expand its partnership with the BPO provider. The outsourced team grew to 2,000 claims processors, and they took on additional responsibilities, such as provider credentialing and utilization management. The BPO provider became a strategic partner, helping the insurer to transform its claims operations and to achieve its business objectives.

“The national health insurer case study is a powerful example of the transformative power of claims processing outsourcing. By partnering with a specialized provider, the company was able to create a world-class claims operation that was more efficient, more effective, and more strategic. It’s a testament to the power of strategic partnership.” – Ralf Ellspermann

The Future of Claims Processing

The claims processing landscape will continue to evolve, driven by new technologies and changing customer expectations. Several key trends will shape the future of claims processing in the Philippines.

The adoption of AI and machine learning will accelerate. AI-powered tools will be used to automate more and more of the manual tasks associated with claims processing, freeing up claims processors to focus on more complex and nuanced cases. Machine learning algorithms will be used to analyze claims data and to identify fraudulent or abusive claims.

The focus on the customer experience will intensify. Insurers and healthcare providers will increasingly compete on the basis of the customer experience, and claims processing will be a key part of that experience. Providers will need to invest in a seamless, omnichannel experience that allows customers to submit and track their claims online, and to receive real-time updates on the status of their claims.

The demand for data analytics will grow. Claims data is a rich source of insights into customer behavior, provider performance, and the effectiveness of different treatments. Providers will be expected to have strong data analytics capabilities and to be able to provide their clients with actionable insights that can be used to improve business performance.

A Strategic Partner for Claims Excellence

Claims processing outsourcing to the Philippines is a powerful and cost-effective way to transform the claims function. By leveraging the country’s large pool of highly-skilled and experienced claims processors, companies can create a more efficient, more effective, and more strategic claims operation. Leading Philippine providers have developed a set of best practices for building and managing world-class claims processing operations, and they are continuously innovating to stay ahead of the latest trends in the industry.

For companies looking to reduce costs, improve efficiency, and gain access to specialized expertise, the Philippines offers a compelling solution. It is a country that understands the importance of accuracy and timeliness and is using that understanding to create a new and more effective approach to claims processing.

References

• Grand View Research. (2024). “Claims Processing Services Market Size, Share & Trends Analysis Report.” 
• American Medical Association. (2023). “The Cost of Claims Errors.” 
• McKinsey & Company. (2024). “The Future of Claims.” 
• Deloitte. (2024). “Global Outsourcing Survey 2024: Multidimensional sourcing.”