Humana moves to real-time claims with Oracle

Humana, headquartered in Louisville, Kentucky, is committed to helping its millions of medical and specialty members achieve their best health. Health insurers such as Humana seek to improve operational efficiency, thereby saving time and money. They also need the agility to innovate rapidly to meet customer and operational needs today and in the future. Often, their legacy systems are unable to accommodate new and emerging requirements. For example, real-time claims adjudication is a growing requirement for payers in the US market, especially as the push for pricing transparency gains momentum.

The way that Oracle Health Insurance is engineered, it's modular enough so that we can focus only on claims transformation right now. Oracle Health Insurance was the only solution that had that ability.

Mike WheatleyAssociate Vice President for the Claims Domain, Humana

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The Opportunity

Claims management and adjudication is ripe for innovation. More than 7% of claims are not paid correctly the first, second, or third time, according to the American Medical Association National Health Insurer Report Card. Extended remediation wastes time and money—more than $43 billion annually. That figure represents simply the direct financial costs and does not take into account accompanying compliance and reputational risk.

Real-time claims adjudication can enable providers to immediately calculate the total responsibility of the patient and collect payment at the time of service. Legacy systems that support only batch processing, however, stand between insurers and their vision for real-time processing.

Humana’s Journey

Humana’s claims system dates to the early 1980s. It served the company well, but was increasingly challenged to support rapidly changing member, sponsor, and provider expectations. Humana needed a system that could take it into the future to enable real-time claims adjudication and much more. It also wanted to take advantage of a corporate cloud-first initiative, in which every technology project is evaluated to determine if it can be accomplished in the cloud.

Those two priorities brought Humana to Oracle Health Insurance. The end result will be an innovative, cloud-based solution that can scale with ease to process claims for millions of members in Humana’s Medicare Advantage plans. Humana chose Oracle Health Insurance because it’s a cloud-based, modularized health administration system that enables the company to implement one component at a time.

“As you can imagine, trying to implement a software package that’s integrated across a company of our size would take years of focused effort to try to get everyone aligned around membership, providers, product, claims, clinical, and more. Oracle Health Insurance enables us to map the transformation journey that is best for us and proceed at our ideal pace,” said Mike Wheatley, associate vice president for the Claims Domain, Humana. Humana has completed initial configuration of the claims solution and is building interfaces to approximately 25 other systems, including third-party repricers as well as enrollment, product, provider, and clinical applications. The company will complete core administration capabilities in 2020, followed by user acceptance testing (UAT), with go-live planned for early 2022.

Future Forward

With Oracle Health Insurance, Humana hopes to go beyond more efficient claims processing to provide future-forward capabilities, including real-time claims processing with the capability for members to pay their share automatically via Apple Pay, Samsung Pay, a Health Savings Account, or bank account.

Humana also is exploring the potential of artificial intelligence (AI) to transform the claims process.

In today’s world, it’s a binary decision as to whether an insurer pays or denies a claim. In the future, Humana plans to leverage AI to enable more informed and accurate decision-making. For example, AI-supported technology might identify instances in which a member, who may have reached his or her office visit limits, could avoid a hospital admission if additional visits were approved. The end result is better outcomes and lower costs.

Humana is also eyeing the use of AI to alleviate claims staffing challenges in a tight labor market.

Lessons from the Road to Innovation

Always focus on the hardest work first, while energy levels are high. Most organizations target the easy work first and celebrate it. When it comes time to tackle the big challenges, they’ve lost the will to keep going.

Make sure the system you select is flexible enough to support your business processes to avoid extensive reengineering when it isn’t necessary.

Published:April 8, 2020