Blue Cross Blue Shield of North Dakota outsources some medical claims processing to India

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The Blue Cross Blue Shield building in Fargo. Forum file photo

FARGO — Blue Cross Blue Shield of North Dakota has begun using a firm with centers in India to process some of its medical claims in an outsourcing move the health insurer said was prompted by a chronic labor shortage.

The North Dakota Blues have been conducting a pilot project using outsourced claims handling in India following a backlog in claims resulting from a switch to a new claims processing computer system.

The 12-month test project began in fall 2019 with a firm called Thryve Digital, a wholly owned subsidiary of HM Health Solutions, a Pittsburgh-based firm that develops claims processing systems for the health-care industry.

Jon Bogenreif, senior vice president of operations for Blue Cross Blue Shield of North Dakota, said Thryve processes an average of 540 claims per day in India. The North Dakota Blues receive 25,000 to 30,000 claims per day.

Most new claims — 92%— are initially processed automatically, with employees doing the initial processing on the rest, he said.


Quality assurance for medical claims processed in India is done in North Dakota, Bogenreif said.

“We’ve been kind of ramping up through the first part of the year,” he said, adding that he expects the maximum level of claims processed in India will be reached during the first quarter.

One supervisor and a staff of 10 to 12 at the Thryve Digital center in Hyderabad, India, process claims for Blue Cross Blue Shield of North Dakota. They already were trained in the HM Health Solutions software, and received several weeks of additional training by Blue Cross Blue Shield, Bogenreif said.

The North Dakota Blues decided to test outsourcing some of their claims processing because of chronic difficulties in hiring people for temporary claims processing jobs during peak times at its Fargo headquarters, he said.

Before outsourcing, to address the claims processing backlog, Blue Cross Blue Shield implemented mandatory overtime. That was not a sustainable solution, Bogenreif said. Staff members were starting to complain about compulsory overtime, he said.


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The decision to outsource some claims processing to India was made after consultations. “We had those conversations with our board and employees,” he said.
The outsourcing does not involve customer service calls or other areas, Bogenreif said. “This was designed to solve a specific problem,” he said.

Blue Cross Blue Shield does not plan to increase the volume of claims handled by the center in India.


"We are going to monitor the pilot this year to make sure it is something we want to continue long-term," Bogenreif said. "If our evaluation shows this has been successful we will likely maintain the 10 to 12 staff we have with them. Rather than increasing the volume of work they would be doing, we will likely train them on new kinds of work — claim adjustments, for example — so that they can provide greater flexibility and utility to our teams."

Other employers in the area, including two health care organizations and an accounting firm, he said, also have outsourced some work because of the prolonged unemployment levels that sometimes make hiring difficult.

Jon Godfread, the North Dakota insurance commissioner, said he views the decision to outsource some claims processing abroad to be an “administrative matter,” and not within his purview as a regulator.

“It hasn’t been an issue at this point,” he said.

Last summer, when the backlog meant it was taking 30 to 60 days to process claims, Godfread’s office received a complaint from one provider. His office convened a meeting between the provider and insurer to help resolve the problems.

“Since that meeting, we’ve had no complaints,” he said.

That provider was a specialty outpatient surgery center that was heavily affected by delays in processing a certain category of claims, Bogenreif said.

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