In the past decade, the number of point solutions and trading partners in health plans has surged, creating complex data ecosystems that increase operational demands on payer organizations. According to Gartner® research, “by 2027, 75% of all IT investments will fail to drive meaningful business value if CIOs do not establish a clear and actionable IT technology investment model.”1 These findings underscore the need for healthcare payers to reimagine their data management strategies, particularly through digital investments that drive efficiency and cost control.
The Human Cost of Inefficient Data Management
One of the most significant cost drivers in IT data management is people. Many payers still rely on large teams to manually transform and update data in real time. This manual approach is costly and diverts resources away from higher-value business priorities, reducing profitability.
As technology advances, payers that continue to invest in outdated methods risk falling behind. Technology investments should be prioritized based on business impact, rather than simply maintaining legacy processes. This approach optimizes resources and strengthens payer resilience, enabling them to adapt to the healthcare industry's shifting needs.
Agile Methodology and Modern Coding for Efficiency
Today, payers can manage data transformation more effectively by using agile methodologies and modern coding languages. Rather than embedding data transformations directly into the claims logic, using tools like SQL on top of base systems allows data analysts to work quickly and safely with data. This agility reduces dependencies on highly specialized skills, enabling junior analysts to handle tasks that previously required experienced engineers.
Modular, reusable data “connectors” have proven effective in reducing time and costs.
Navigating the “Buy vs. Build” Dilemma in Digital Investments
The choice between building custom solutions and adopting off-the-shelf products is a pressing concern for payers. Gartner advises CIOs to, “Select and prioritize the specific digital investment targets/initiatives by establishing a structured and repeatable process for evaluating potential technology investments.”
To ensure alignment with business goals, investing in transparent, open systems with committed partners is crucial. Payers should look for solution providers who prioritize collaboration, offer regular reporting, and demonstrate clear value to the business. Gartner also states, “As CIOs take on more project requests, they need a straightforward and repeatable evaluation model to deliver technology initiatives based on their impact on business priorities.”
Key Takeaways
Digital investments are no longer optional for health payers aiming to meet their profitability goals. According to Gartner, “A formal project prioritization model can help IT to engage the business in the prioritization of IT resources to maximize the benefit of digitization efforts.” This alignment not only drives down operational costs but also positions payers to capitalize on new growth opportunities.
By adopting data management best practices - from agile methodologies to modular systems and strategic partnerships - payers can modernize their operations and reduce costs while enhancing profitability.
Unlock Your Organization’s Potential
Flume provides advanced solutions that enable healthcare payers to streamline their data operations, reduce manual work, and align digital investments with profitability goals. Ready to transform your data management processes? Contact us today to explore how Flume’s innovative approach can help your organization prioritize digital investments that drive real business value.
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1Gartner, Prioritize Digital Investments That Maximize Business Value, Robert Naegle, Chris Ganly, et al., 30 October 2023 (Report accessible to Gartner subscribers only)
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