Situation
A regional health insurer and Medicare manager sought to grow market share in the federal and state government markets and reduce administrative costs.
Key Challenges
-
Determine the extent of the market opportunity
-
Asses leverage of existing business development and product offering capabilities
-
Identify opportunities to reduce costs through organization structure, business processes, and staff reduction
-
Organizational resistance to proposed changes
Rapid Deployment Solutions
-
Conducted competitive analysis of market size, dynamics, and opportunities for expansion and profitability.
-
Developed financial simulations to determine sensitivity revenues and costs to market share, process costs, and claims management experience.
Strategic Solutions
-
Determined opportunities to reduce operational costs
-
Developed Shared Service model
-
Redesigned business process and authorizations
-
Eliminated duplication in Line of Business administrative functions
-
Consolidated functional support in Finance, Technology, Marketing, and Human Resources
Functional Focus and Impact
-
Corporate strategy
-
Competitive positioning
-
Organizational structure
-
Finance
-
Human Resources
-
Information Technology
-
Marketing
-
Administrative cost management
-
Activity based costing and zero based budgeting
Results
We utilized activity based costing and zero based budgeting to clearly represent process, service, and functional costs. Client successfully realized more than $20mm in first year cost savings by implementing a shared services support capability.
