Employee benefits are more important than ever, yet inefficiencies abound in their administration and management. Over $900 billion is lost to healthcare waste every year in the US, due in large part to a lack of transparency and coordination between providers and payers.
At the heart of these challenges is data — how it’s stored, how it moves between partners, how it’s cleaned for use. Electronic Data Interchange (EDI) was a great invention three decades ago, but its batch updates and store-and-forward method makes for one-way data communication.
APIs (Application Programming Interfaces) may feel like a buzzword in insurance and benefits circles, but they’re enabling a frictionless, efficient approach for the entire industry. Here’s what the industry can accomplish by building the crucial infrastructure for modern benefits.
Better Data Quality for Modern Employee Benefits Management
Data quality is a persistent and industry-wide problem in benefits. With most employee data trapped in silos and exchange taking place via paper-based files or EDI, it’s no surprise how many coverage and billing errors people encounter every day. Entire operations teams exist to tackle these challenges, but coverage errors inevitably trickle down to consumers — even impacting their access to care.
Technology can solve these problems by collecting, cleaning, and sending data in a standardized way in near real-time. This approach removes the need for manual interventions and provides transparency into every transaction at scale. Robust tech infrastructure also automates key workflows across the policy lifecycle, reducing operational expenditure.
A Catalyst for Growth and Innovation
Building API infrastructure for modern benefits unlocks growth and innovation in key ways:
- Speed. Benefits administrators can process transactions and onboard groups faster without ever having to rely on a person to re-enter data; eligibility data is transferred programmatically and can be instantly synced across any connected system.
- Automated Accuracy. Data can be kept in sync between insurance carriers and benefits software. APIs allow for upfront validation that immediately reject requests if something is missing or a business rule is not followed.
- New Levels of Insight. APIs are like building blocks enabling one to query and manipulate data for almost any use case, putting new product experiences in reach.
- Scaled Connections. Developers can set up connections between platforms in days, not weeks or months. APIs flexibly integrate with any carrier or benefits software system.
- Security and Compliance. APIs allow very granular permissions, so it’s possible to create more nuanced, secure systems.
- Ecosystems. In the future, clean, standardized benefits data will become even more accessible to developers, leading to a new ecosystem of benefits applications.
Frictionless Employee Benefits
Ultimately, the goal is to enable benefits experiences as convenient and unified as consumers already expect from retail, hospitality, and finance. Imagine having one app to check which doctors are available in your network, how much you’ve spent against your co-pay and deductibles, and what services are covered by your policy so you can make the best decision in the moment. Technology infrastructure is both the foundation and bridge to legacy systems to make it all possible.