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Life and health insurance companies are finding that electronic document storage and retrieval eliminates the need for huge amounts of costly real estate for filing cabinets and for thousands of work hours spent searching for, removing and returning their copious records.
A case history provided by Information Management Research, a document-management software firm in Englewood, Colo., is typical of the problems insurers face in keeping tabs on customer records and other documents.
One of IMRs customers, Benesight, is a large healthcare administrator that designs and manages self-funded healthcare benefits for more than 1,200 employee groups ranging from 50 to more than 20,000 members. The company, headquartered in Wayzata, Minn., handles claims for more than 1.1 million members of about 5,000 benefit plans.
With more than 27,000 healthcare claims annually and thousand of claims-related telephone calls to handle, retrieving and processing this volume of information is a prodigious task. More than 600,000 sheets of paper are processed monthly, including incoming claims forms that, before the company adopted optical scanning, had to be sorted and entered by keyboard.
Numerous review and approval steps further complicate the process. Any information missing from a claim form had to be marked for additional processing and shuffled from desk to desk, adding to the delay in processing. Just finding where a given document was in this convoluted processing scheme was a major challenge.
Benesights answer was to install a completely revamped claims administration center in Pueblo, Colo., with a document-scanning system as its centerpiece.
A spokesperson for IMR, which assisted Benesight in equipping the new center, says the new system has sharply streamlined document processing and significantly cut human error.
Under the new system, claims forms are scanned onto a CD that is delivered daily to Benesights data center. The CD contains scanned TIFF images from claims forms as well as data files with the pertinent fields needed for indexing. As the TIFF files are transferred from the CD, a database of claims records is built, using IMRs Alchemy software.
This allows Benesight personnel to readily access and search the electronic claim forms stored in Alchemy, using any search field entered during scanning, such as claim number, social security number or date of medical service.
The Alchemy database resides on a Windows NT server, notes Don Blake, IMRs spokesperson. Access to the database is via a Novell PC network in Pueblo, as well as a wide area network connecting corporate headquarters and seven regional claim sites. Authorized employees can gain access to the database at any time, allowing customer service reps to take care of problems or answer questions in minutes, compared to days under the old system.
Images of claim documents remain in magnetic-based storage for six months before being transferred to DVDs for permanent archiving.
Benelifes new system is part of a new wave of scanner-based systems that are helping insurance carriers and administrators eliminate time-consuming manual entry of data, slash claims-handling time, improve service to customers and make key documents available to employees throughout the company.
Records of premium payments, policyholder claims and other data once stored in filing cabinets, over hundreds of square feet of floor space, are now retrieved within seconds from a relatively small room full of file servers and related equipment.
Sean Fornash, director of the resource management group at John Hancock Life Insurance Company, Boston, says there are two reasons optical disk storage is better than conventional storage media.
"First, keeping the files for years requires a much more robust system than tape storage," Fornash says. "Then the amount of storage space required by optical media is far less than tape."
Hancock also still uses less high-tech means for storing and retrieving certain documents, he notes.
For instance, some company units still require microfilm. But because there is so little call for it, Hancock outsources all of its microfilm processing to Anacomp, a San Diego firm providing document management services.
After various periods of time, depending on the nature of the documents, Hancock stores the documents offsite on optical disks, using the third-party storage company Iron Mountain, in Boston.
"They do most of the storage for our open systems and mainframe platforms," says Fornash.
