Case Study

New best practices for integrating with ACA exchanges drive competitive advantage for leading health insurer

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A leading U.S. health insurer


Business need addressed:
Efficient business practices for marketplace-driven businesses to comply with new regulations

Genpact solution:
Lean Six Sigma processes seal operating gaps with marketplace, and new finance and accounting controls maximize revenue, minimize risk, and ensure conformance to federal rules

Business impact:
Enterprise readiness for the marketplace, more transparency with C-suite leaders, and a competitive advantage to early adopters

  • Growth and scalability
  • Adaptation and flexibility
  • Risk and compliance

Insurers must adapt to the major changes ushered in by the Affordable Care Act. Unless they immediately adopt new ways to operate—and close vital information gaps with marketplace—health reform could cost them dearly. Genpact processes help healthcare leaders optimize a course for this new era.

Challenges surge under the Affordable Care Act

Landmark health reform in the U.S. uses a public marketplace for people to access insurance plans and to qualify for premium subsidies from the government.

This extra layer between customers and insurers adds complexity and risk for insurers, especially when enrolling customers, verifying and reconciling their information, billing and making payments, and conducting overall financial management.

Some might say it’s a perfect storm for insurers. Here are some of the major contributing problems:

  • Enrollment information that needs to reach insurers completely and correctly from CMS may not do so because marketplace portals use centralized forms that do not suit specific insurers. Also, insurer legacy systems are often incompatible with CMS enrollment formats. These gaps could impede insurers from securing their fair share of the nation’s surge of newly insured individuals
  • Any glitch in sign-ups could drive applicants to shop elsewhere
  • Insurers have to manage both on-and off-marketplace sales with different call-center scripts and sustain their knowledge of business rules that are unique to each

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  • Customer service agents need to understand the new business rules for customers receiving federal subsidy in order to address their calls. Call volumes are already high and service agents are strained, and they must now engage with a vast new base of price-sensitive and subsidy-eligible customers
  • Insurers must collect, reconcile, analyze, and report payments from both covered individuals and government subsidies
  • Companies also need to establish an accounting framework to manage and report federal subsidy payments and additional taxes as well as their revenue-risk experience over time to apply for balancing payments from the government
  • Due to shifting CMS requirements, insurers are challenged by the stretch timeline to resolve multiple issues
  • Insurers will be subject to a greater number of audits as the government has a stake in how companies treat marketplace customers
  • Insurers could lose existing customers if they don’t innovate and stay competitive as many current customers will visit the marketplace to scout for subsidies and alternative choices

Federal and state governments, consumers, and insurers are all quite new to mandatory health coverage. There is little domestic history to rely on, and insurers in particular take on the brunt of many new rules, requirements, and restraints.

The industry appears to be in dire need of new best practices in a marketplace still evolving and posing many new risks.

Genpact prepares major insurer to excel with marketplace

Genpact mapped the end-to-end processes of a company, addressing every stage of the customer experience starting with initial enrollment in a federal or state-based marketplace. All the possibilities in an insurer-insured relationship were covered, including maintenance changes on policies, customer delinquency, and policy cancellation, termination, and reinstatement, with the intent to maximize revenue by delivering a positive member experience.

Moreover, Genpact enabled the company to design a new accounting framework for the marketplace in an effort to conform to complex accounting requirements without upsetting its established F&A framework. To achieve this, Genpact set new policies and procedures for the insurer to record new financial transactions resulting from the marketplace, reconcile new accounts, produce relevant internal management reporting, and fulfill external reporting requirements. Improved F&A controls also allow the CFO to readily view F&A in tandem with any other area, such as membership, claims, or customer service.

With these proven processes, the insurer also became able to make informed staffing decisions, improve communications and training, and foster a positive culture. Genpact has become the insurer’s business partner to manage the accounting operations of the individual business segment.

The application of Lean Six Sigma tools prepared the company operationally for the surge of new marketplace policy buyers. As a result, the insurer grew more efficient and all areas of the enterprise became unified.

The company also implemented governance and review structures given by Genpact to track its readiness to serve a vast pool of new customers. As a result, it became better at managing risk planning for contingencies in a rapidly-changing marketplace. The insurer’s C-suite leaders say that numerous metrics views give them the levels of transparency required in business today, an essential quality in an uncharted era of transformed healthcare.

Significant business impact ahead

This insurer is an early adopter of Genpact processes. As one of the first to evolve its best practices, it already reaps a competitive advantage. Others that follow can soon expect to maximize revenue, reduce operational gaps and risks, conform to federal rules and reporting requirements, and raise customer satisfaction, all while ensuring efficient growth and scalability and transparency for senior management.

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