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IT EFFICIENCY KEY TO REDUCING COSTS

Greater efficiency will minimise administration costs and increase spend on actual healthcare costs.

With 15 years' experience in the healthcare industry, Kevin Wright, Medscheme's newly appointed Chief Operating Officer (COO) has an excellent grasp of both the industry and the effect that the intelligent use of IT has on lowering costs.

Over the past three years, Medscheme's IT division has made significant investments in upgrading its IT platform, rationalising servers, integrating back-end systems and equipping its call centres with state-of-the-art technology - all aimed at increasing efficiency and reducing operating costs.

"Previously, the thinking was to have call centres that were physically close to the customer. However, technology now makes it possible to serve customers from remote locations," says Wright.

"Simultaneously, the centralisation of back-office systems leads to consolidation and integration which, in turn, reduces cost," he says.

Looking ahead, Medscheme's vision is to achieve even greater reductions in operating costs without compromising the quality of service to clients.

"The more efficient Medscheme can be, the better," says Wright.

"By minimising the administration cost component, there will be a greater share of the medical premium left to spend on actual medical costs. This is in line with the Council for Medical Schemes' goal to reduce what are termed "non-healthcare costs".

The key is to deliver the appropriate level of service at the lowest cost.

Reducing communication costs is an essential aspect of the overall strategy to drive costs down. The communications bill is one of Medscheme's largest expenses with actual hardware and software costs just a fraction of overall costs. System upgrades are therefore often geared to achieving savings in this area.

Medscheme's considerably investment in IT also allows the company to develop a far more personalised and intelligent approach to cost management. Medscheme has the business intelligence resources that are able to identify a medical scheme member who has not claimed for chronic medication. The system is then able to alert the member (by e-mail, SMS or fax) to continue with the medication. This benefits the member's health, reduces the risk of avoidable and expensive emergency treatment and ultimately saves costs.

"As we move into the future, there are many possibilities in terms of what Medscheme will be able to offer its clients. It's a matter of developing the most cost-effective ways of doing it - and that's where technology plays such a key role," he concludes.