Digitalization: The Innovation Premium for Healthcare Insurance


The proliferation of new technologies is disrupting almost every industry. With new ways of consuming goods and services through new technology platforms, many sectors—from retail, hospitality, and entertainment to financial services and healthcare—need to review their operating processes and organizational structures and continuously innovate or risk falling behind the innovation race.

The move towards a digital, innovation-driven economy is high on Singapore’s agenda, intending to bring more comprehensive benefits to Singaporeans while transcending its resource limitations. However, despite its promise, digitalization is slow to take off in specific industries such as healthcare and insurance.

No reason to be different

The shift towards a digital healthcare system is inevitable, and countries like Denmark, Sweden and Estonia are leading the way. In Singapore, the healthtech solutions have paid off during the COVID-19 pandemic. The deployment of technology to facilitate active data sharing across systems used by individuals and healthcare providers has helped to flatten the pandemic curve.

The value of technology in healthcare stood out during the global pandemic. While Singapore has delivered good healthcare outcomes within fiscal control, it is critical to go beyond switching from pen and paper to adopt a fundamental shift in the way we rethink our processes. For instance, how can we streamline our processes using more efficient digital alternatives without compromising quality?

A case in point is healthcare insurance sector. Although regulatory compliance and data privacy are commonly cited as barriers for healthcare insurers to go digital, there is no reason the industry should be different. Beyond providing adequate coverage for policyholders, healthcare insurers must ramp up their digitalization efforts in the face of a rapidly aging population and rising healthcare costs.

To this end, the General Insurance Association Singapore (GIA Singapore), Life Insurance Association, Singapore (LIA Singapore) and Integrated Health Information Systems (IHiS) have embarked on a cross-sector alliance initiative to develop an end-to-end health insurance claims platform to improve patient experience, enhance operational efficiency between healthcare providers and insurers and eliminate cost inefficiencies.

Data challenges for the healthcare insurance sector

With healthcare going digital, healthcare providers and insurers are generating vast amounts of data, including sensitive patient information, electronic health records and billing information. Managing this data tsunami is critical in improving patient outcomes, reducing administrative costs, and providing personalized care.

However, healthcare data is a prime target for cybercriminals worldwide, given that it is mission-critical and highly confidential. As the custodians of healthcare data, healthcare industry players face significant challenges regarding data storage, security, and analysis. Any compromise on healthcare data can severely impact patients, healthcare providers and insurers. For instance, health insurers are exposed to data challenges when cybercriminals set their eyes on patients’ medical records containing a wealth of information that can be used to file fraudulent insurance claims. To stay competitive in the marketplace, health insurers must digitalize their processes to keep pace with the exponential demand for healthcare and insurance services alongside Singapore’s aging population and greater access to public and private healthcare resources.

The insurance claims process has traditionally been paper-based, mainly due to a lack of interoperability. Healthcare providers and insurers need to track and access multiple systems for information exchanges, resulting in long processing times that may take months and inconvenience patients. Moving towards an integrated health insurance platform with a secure data exchange will help address the pain points faced by both patients and insurers, such as the uncertainty over the claimable insurance amount upon hospitalization, lengthy processing time and manual errors.

Modernizing the healthcare insurance sector for better patient support

Digital technology has paved the way for health insurers to improve their operations and tackle the challenges they face today. Leveraging technologies such as artificial intelligence (AI) and machine learning (ML) can help speed up insurance claim processes and decisions, ultimately reducing costs and improving efficiency. One significant advantage of AI and ML is automating underwriting for new policies and approving claims. This results in faster turnaround time while reducing costs associated with manual processes.

Digitalization is also providing health insurers with new ways of engaging customers, where chatbots and other digital tools can help create personalized services efficiently and quickly. In parallel, the brokers can also benefit by receiving and processing all information from one system, integrating healthcare incident reporting and claims management. This leads to faster and more accurate claims processing, ultimately improving efficiency and accuracy.

As healthcare goes digital, healthcare providers and insurers are vulnerable targets for cybercriminals due to their reliance on mission-critical and sensitive data. To deliver higher quality care faster, healthcare providers and insurers are increasingly moving patients’ records to the cloud to facilitate data sharing. As such, more needs to be done in this aspect to safeguard the patient’s privacy. For instance, insurers can significantly reduce the risk of data breaches by adopting autonomous cloud-based solutions that leverage AI and ML—with automated malware scanning and near real-time anomaly detection—to automate protection from cyber threats and keep data safe and compliant with AI-based ransomware resilience.

Most insurance claims systems are monolithic applications designed and built years ago. However, that shouldn’t come in the way of closing the insurability gap and offering protection to those who most need it. With the sheer volume of data generated from customer insurance policies, risk profiles and medical claims, health insurers can only function well by adopting a holistic data management strategy to manage their data. With digital tools that provide advanced analytics and data insights, health insurers can stay ahead of their competitors by optimizing the cost of storage, making informed decisions on underwriting/claims and designing new innovative offerings for customers.

Ronald Tan, country director for Singapore at Veritas Technologies, wrote this article.

The views and opinions expressed in this article are those of the author and do not necessarily reflect those of CDOTrends. Image credit: iStockphoto/champpixs


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