About 64% of health insurer C-suite executives say that digital transformation is a top priority, while 35% say it’s a “medium” priority, new data from West Monroe shows. Yet, there are some challenges to implementing digital initiatives.
West Monroe is a digital services firm. It recently published a report called “The Digital Disconnect: Linking Vision to Real-World Execution,” which surveyed 700 C-suite executives and 5,000 consumers across industries about digital transformation. This week, the firm shared with MedCity News additional data taken from the survey that is not included in the report. This data includes responses from 100 health insurer C-suite executives.
Despite most insurer execs saying that digital transformation is a top priority, only 8% believe the majority of their staff embrace digital transformation. Insurers’ biggest barriers to digital transformation initiatives are competing priorities (36%), quality of data (35%), uncertainty over business continuity amid economic volatility (34%) and siloed teams and data (34%).
“Digital transformation initiatives entail long-term commitments with somewhat unclear value returns,” said Beth Mosier, a director in West Monroe’s Healthcare & Life Sciences practice, in an email. “With budgets typically planned on a short-term and annual basis, it becomes challenging to allocate funds for competing priorities that promise longer-term benefits, especially for companies operating on tight margins like health insurers.”
One hot topic in digital health has been AI, an area the survey touched on as well. The top three areas insurers are looking to pilot AI are finance (with 48% saying this), customer success (41%) and HR (41%). In finance, AI can automate tasks for revenue tracking and projections, Mosier said. When it comes to customer success, “AI can greatly improve the customer experience by helping them understand their explanation of benefits, deductibles, out-of-pocket expenses, and other key and complex areas,” she added. Lastly, payer HR departments don’t generate revenue, “making them one of the least risky areas to first implement AI,” according to Mosier.
However, the lack of clarity around how jobs and work will change is the biggest challenge for implementing AI, the insurers said.
“The transition to AI-enabled processes raises concerns related to risk, especially for insurers who tend to be risk-averse by nature,” Mosier said. “Insurers are particularly concerned about the skills and capabilities required to operate effectively in an AI-driven environment. There is a huge need for change management, including upskilling and cross-skilling to adapt to the shift towards AI-enabled processes. Traditionally, financial modeling has been a largely manual process. The move towards tech enablement introduces elements of uncertainty and risk in an environment that is already predisposed to risk aversion.”
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