Insurers in dark ages with outdated IT

Most health insurance companies plan to support new payment and business models, including value-based plans, pay-for-performance and accountable care organizations (ACOs), but they don't have the necessary information technology (IT) systems in place, according to a new payer survey from HealthEdge.

Of the 106 health insurers surveyed, 54 percent said they are prepared to support ACOs, and 50 percent support pay-for-performance initiatives. Another 64 percent support "other healthcare reform initiatives," while 51 percent support "other models involving new payment approaches," reports Healthcare Finance News.

Despite this broad support, most insurers' outdated IT systems can't handle the new initiatives. Only 37 percent of survey respondents said they can support technological requirements for ACOs, and only 35 percent said they can support value-based benefit designs' technological needs, according to InformationWeek Healthcare.

"We're going from one-size-fits-all healthcare to this brave new world of personalization," HealthEdge Executive Vice President Ray Desrochers told InformationWeek Healthcare. "It's very clear that payers have a lot of work to do [to participate in these new business models] from an IT perspective."

The most significant obstacles facing payers and their IT systems include challenges adopting new standards and regulations, high rates of manual processing, out-of-control administrative costs and difficulty providing real-time access to critical business data.

The survey also showed that payers aren't ready for ICD-10. Only 22 percent said they were fully prepared to support ICD-10, while 37 percent said they were "somewhat prepared" but unsure of their ability to meet the deadline. Another 36 percent are just starting to prepare for ICD-10, and 5 percent haven't even finished evaluating their IT capabilities or created a remediation plan.

The problem with ICD-10 preparations, according to Desrochers, is that many payers still use very old IT infrastructures. "The payer community lives in a world that is dominated by 30-to-35-year-old systems," he said. "There's no easy path from A to B when you're dealing with mainframe, green-screen, 35-year-old systems."

To learn more:
- see the HealthEdge press release and survey (reg. req.)
- read the Healthcare Finance News article
- check out the InformationWeek Healthcare article

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