Why Payers Must Prioritize Member Experience over Member Services

In the 2021 Customer Experience Index from Forrester, every payer company improved – but only enough to receive a rating of “OK.” Despite significant investments on the part of many payers to improve the member experience, they still rank above only cable companies and the Federal government.

Why such a lackluster ranking? Members struggle to get the information they need when they need it, whether it’s through a contact center an app  or portal. They can’t determine if a procedure is covered, if a doctor is in network, or their medication costs. All too often, members go to the doctor without this knowledge and wait days, if not weeks, to find out whether they owe anything.

There are many ways to improve member experience and outcomes. Capto’s research has found that achieving a 10 percent improvement to the understanding of member benefits and costs results in an 8 percent improvement in a payer’s Net Promoter Score (NPS). These improvements include defining key insurance terms for members as well as helping them see how much any type of medical care will cost under their coverage, whether it’s a wellness visit or a surgical procedure. That compares with just a 4.3 percent improvement to NPS resulting from a similar 10 percent improvement to member services.

Unfortunately, most payers have it backward. According to Change Healthcare, 80 percent of payers have invested one-third of total IT spending on contact centers and omnichannel member service deployments – hiring staff, creating training programs, implementing customer relationship management software, and so on. That’s total IT spending, not just member experience spending.

This has an adverse impact in two key ways. One is that contact center innovations really work only in the contact center where by the time the member calls they are already frustrated. These new technologies and best practices are less impactful trying to recover from a negative starting place.

The other is that focusing on the low-hanging fruit that the contact center represents leads to relative underinvestment in member experiences that transcend member service and are demonstrably more impactful.

Capto’s research has also found that a one-point improvement in MX score translates to member growth that averages 0.7 percent per year. For example, a plan with 1.5 million members and annual revenue of $3 billion could expect to add 7,000 new members and $21 million in revenue per one-point gain in NPS. If that payer invests in improvements to understanding member benefits and costs, and achieves that 8 percent boost to NPS, it will add about 25,000 more members and $75 million more in annual revenue than with member service improvements. Those numbers are hard to ignore.

To rise above the rating of “OK,” payers need to better understand where they can achieve the greatest improvements in member experience in the shortest time. Identifying, prioritizing, and executing the right large-scale customer experience improvements not only optimizes the customer journey but also minimizes operational costs – and gives payers a chance to level up to higher-performing industries on those customer experience rankings.

Read our whitepaper about how a more strategic approach to member experience drives growth in revenue and market share.