Insurance Companies Were Hungry for File Feeds

Tracking who’s in and who’s out is easy in a game of “Tag.” It’s much more difficult to track when it comes to group insurance plans, and that’s why we’ve evolved a unique approach to the problem. 

Insurance companies rely on Selman & Company to perform various outsourced administration services for basic and supplemental insurance benefits such as Long Term Care, Term Life, Disability Income and Accident Insurance, among others. Employer groups, or plan sponsors, purchase these products from insurance companies. One of the administrative services we offer to insurance companies is Notification of Continuation, also nicknamed “File Feeds.” This service aids in fulfilling the employer group’s obligation to notify individuals of their continuation rights for coverage (or a portion of their coverage), which is being lost due to a defined qualifying event. An example of a defined qualifying event, such as an employee leaving a job, is a common event that triggers the need for a Notice of Continuation. Large insurers’ processes are ideally configured to manage group plans, so when an employee leaves a group plan, it creates an exceptional event that can be cumbersome to manage correctly.

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On a regular interval, employer groups provide us records of individuals who have lost coverage and must receive a notice of continuation. Upon receipt of these records, Selman & Company pre-populates a notice letter with basic information and mails it to the eligible individual. When the individual returns to us a request to continue, application forms and premium quotes are sent to the applicant(s) based on information provided on the File Feed and the policy requirements. Selman & Company completes the employer portions of the Notice of Continuation forms based on information provided on the File Feed.

This process does three things: It assists in satisfying the employer group’s obligation to notify individuals of their continuation rights. It simplifies things for the employer group as well as the end user. This process also gives the insurance company the opportunity to retain revenue that otherwise could be lost. The Notification of Continuation service, or what we call a “File Feed,” addresses many problems plan sponsors and employer groups face when dealing with employees who lose coverage.

An Evolution Based on Client Needs

We process more than 32,000 notices of continuation per month, for approximately 200 groups. The current process runs smoothly, but it evolved to become a unique Selman & Company outsourcing service due to the demands of our clients. In a sense, our clients developed this administrative service because they were experiencing:

• Increased demand: Increased event frequency and larger list sizes
• Tighter data security requirements within our industry
• Desire for enhanced customer service and revenue retention

The File Feed service grew from the ground up. It started with three cases, and was originally designed as a simple mail merge process. The original objective was to meet the employer’s obligation to provide conversion and/or portability rights notification to employees who lose any portion of their coverage. Send data file. Mail merge. Print and send letters. Easy, right?

This provided the plan sponsor the assurance that notifications were being sent out. It also helped the plan sponsor avoid the additional costs of claim exceptions and additional claim obligations. Prior to File Feeds, the plan sponsor could have incurred these costs when it was discovered an employer was not providing notices or not providing them in a timely manner.

Over the years, this service gained popularity and morphed into a notification and processing service. 

This evolution significantly changed the intent of the service. In late 2014, the Selman & Company team determined that we could no longer provide one of our largest outsourcing clients with best-in-class service at an economical price for File Feeds, because we could no longer provide this service efficiently and accurately under the original design. Simply put, the objectives had changed too much and we outgrew the original “mail merge” design. Today, File Feed administration looks very different.

Client Outcomes

File Feed administration now delivers specific benefits to plan sponsors.

• Real time, automated acknowledgement of file receipt to provide immediate confirmation of a successful file transfer and validation of total record count;
• File scheduling to provide an automated message when a file is not received at the anticipated date;
• Improved data integrity through additional data screening;
• Confirmation of file processing with detail of records processed, records rejected and clear description of reason for rejection;
• Securely returns a file of rejected records allowing the client to quickly correct and resubmit records for processing and ensures notification occurs timely;
• Improved group level reporting by date range and trend identification;
• Comprehensive service manual to assist in education of the service and notification requirements.

Now that we’ve gone deep—very deep—into the weeds of notification of continuation, you may have a new appreciation for the work involved on the back-end when employees separate. So, the key takeaway here is either: A) Don’t quit your job if you like your fringe benefits, or, B) The “File Feed” is a niche insurance administration service that applies systematic data control, processing, and communication features to the greatest extent possible. It remedies a very specific problem to help plan sponsors recoup revenue and deliver a better customer experience.

Want to learn how this would work for your groups? We're happy to talk details.