Case Study – Health Insurance
Fortune 100 Healthcare Insurance Provider
Contract Creation System Delivers Greater Control and Helps Avoid Litigation
Formed in 1992, the company offers health plans and related financial services to consumers and manages one of the largest managed care businesses in California. In 2003, the company had combined revenues of approximately $37 billion, has 38,000 employees and 28 million U.S. members, and is licensed in 13 states.
A typical hospital contract negotiation process took six months and resulted in the exchange of hundreds of iterations and revisions of a particular document, a process accomplished via fax or regular mail. The healthcare company was faced with the challenge of tracking these changes manually, which exposed it to the inclusion of risky contract language.
Another weakness in the contracting process was the lack of uniformity in both its contracts and rates, the result of a disjointed process (e.g., the "back and forth" nature of hospital contract negotiations) that included manual entry in the rates and other data fields of the contracts.
To minimize risk and litigation, the entire contract management process had to be improved, including the automation of hospital contract amendment negotiations. The company was seeking a robust electronic "filing cabinet" and a workflow-based solution for all its document negotiation tasks. More specifically, it sought a contract management application that provided a Web interface and quick turnaround times, as well as one that accurately captured the changes occurring during negotiations.
Document Sciences delivered a document-production solution for the company's correspondence as well as its contracts and policies (both to be delivered in PDF and archive formats). The healthcare company is using xPression® for the Web-based creation, management and publishing of the contracts it negotiates with its network hospitals.
The company selected xPression for numerous reasons, including the solution's ad hoc capabilities; its use of rules/business logic to pull in the correct language for a specific document; and its customization capability, which allows the base contract to be managed as it changes through the negotiation process. Also important were xPression's open J2EE architecture, its ability to integrate/interface with IBM's Content Manager (as well as IPD for workflow), and a well-executed, interactive demonstration. A big selling point was the feeling that Document Sciences understood the company's needs and was willing to work to find a suitable solution.
Now that it has better control over the negotiation process, the company can more effectively negotiate hospital contracts. Specifically, the company can readily track changes to contract amendments between itself and several hundred of its network hospitals (personnel can review and approve revisions, ensuring correct legal language and minimizing the company's exposure to errant content). The company is also able to realize better rates, and personnel have a more precise real-time view of negotiations.