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Advanced Document Management Systems Cut Processing Time, Costs

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Life and health insurance companies are finding that electronic document storage and retrieval eliminates the need for huge amounts of costly real estate for filing cabinets and for thousands of work hours spent searching for, removing and returning their copious records.

A case history provided by Information Management Research, a document-management software firm in Englewood, Colo., is typical of the problems insurers face in keeping tabs on customer records and other documents.

One of IMRs customers, Benesight, is a large healthcare administrator that designs and manages self-funded healthcare benefits for more than 1,200 employee groups ranging from 50 to more than 20,000 members. The company, headquartered in Wayzata, Minn., handles claims for more than 1.1 million members of about 5,000 benefit plans.

With more than 27,000 healthcare claims annually and thousand of claims-related telephone calls to handle, retrieving and processing this volume of information is a prodigious task. More than 600,000 sheets of paper are processed monthly, including incoming claims forms that, before the company adopted optical scanning, had to be sorted and entered by keyboard.

Numerous review and approval steps further complicate the process. Any information missing from a claim form had to be marked for additional processing and shuffled from desk to desk, adding to the delay in processing. Just finding where a given document was in this convoluted processing scheme was a major challenge.

Benesights answer was to install a completely revamped claims administration center in Pueblo, Colo., with a document-scanning system as its centerpiece.

A spokesperson for IMR, which assisted Benesight in equipping the new center, says the new system has sharply streamlined document processing and significantly cut human error.

Under the new system, claims forms are scanned onto a CD that is delivered daily to Benesights data center. The CD contains scanned TIFF images from claims forms as well as data files with the pertinent fields needed for indexing. As the TIFF files are transferred from the CD, a database of claims records is built, using IMRs Alchemy software.

This allows Benesight personnel to readily access and search the electronic claim forms stored in Alchemy, using any search field entered during scanning, such as claim number, social security number or date of medical service.

The Alchemy database resides on a Windows NT server, notes Don Blake, IMRs spokesperson. Access to the database is via a Novell PC network in Pueblo, as well as a wide area network connecting corporate headquarters and seven regional claim sites. Authorized employees can gain access to the database at any time, allowing customer service reps to take care of problems or answer questions in minutes, compared to days under the old system.

Images of claim documents remain in magnetic-based storage for six months before being transferred to DVDs for permanent archiving.

Benelifes new system is part of a new wave of scanner-based systems that are helping insurance carriers and administrators eliminate time-consuming manual entry of data, slash claims-handling time, improve service to customers and make key documents available to employees throughout the company.

Records of premium payments, policyholder claims and other data once stored in filing cabinets, over hundreds of square feet of floor space, are now retrieved within seconds from a relatively small room full of file servers and related equipment.

Sean Fornash, director of the resource management group at John Hancock Life Insurance Company, Boston, says there are two reasons optical disk storage is better than conventional storage media.

“First, keeping the files for years requires a much more robust system than tape storage,” Fornash says. “Then the amount of storage space required by optical media is far less than tape.”

Hancock also still uses less high-tech means for storing and retrieving certain documents, he notes.

For instance, some company units still require microfilm. But because there is so little call for it, Hancock outsources all of its microfilm processing to Anacomp, a San Diego firm providing document management services.

After various periods of time, depending on the nature of the documents, Hancock stores the documents offsite on optical disks, using the third-party storage company Iron Mountain, in Boston.

“They do most of the storage for our open systems and mainframe platforms,” says Fornash.

As with all complex document storage systems, backup is vital. All files are backed up with optical disks, with copies stored both on- and off-site.

In the last two to three years, Fornash says, his department has gotten an average of 800 to 1,000 requests from departmental managers to restore lost fileseverything from a single document to the entire contents of servers.

“There has been a significant value to the company for us to be able to do that,” Fornash explains. “The cost associated with the necessary backup system is high. But so is the benefit.”

Everything on a file server or mainframe is backed up at Hancock, Fornash says.

“Once we had to recover some mail servers in their entirety and were able to go back to get mail sent years earlier,” he explains.

“In another case, we had a very large business application running where we had hardware problems, causing an entire database to be lost. We were able to recover completely.

“So from a business continuation point of view, robotic libraries enable us to support every department,” says Fornash. “We never had a hardware failure from which we couldnt recover.”

Hancock did a major upgrade of its optical scanning systems in the summer of 1999.

“We went from 12-inch platters to 5.5-inch ones,” recalls Fornash. “Disk readers tend to wear out, so we had literally thousands of disks becoming antiquated. We contracted to have that done for us. So periodically, we have the challenge of changing to a new technology.”

Converting the old disks to the new format was a slow process, taking several months. That was actually a deliberate precaution, to ensure that the California-based company that was converting the disks wasnt overwhelmed by the sheer volume of the task, leaving the content of disks vulnerable.

“We would have maybe 110 disks a week at their site and a similar number in transit, so we wouldnt have all of the disks in an unsecured location,” says Fornash.

Hancock has a half-dozen Unix servers dedicated to optical imaging, supported by two fully functional Filenet environments provided by the business process software firm, Filenet Corporation, headquartered in Costa Mesa, Calif.

Even with optical scanning, retrieval of images can take a substantial amount of time, notes Fornash, when documents can be 10 to 100 pages long.

Hancock was able to slash that time substantially by boosting Filenets file-caching ability via a dedicated disk-caching system.

“Generally speaking,” Fornash explains, “we found that many documents will be referred to not once but several times over many days. We didnt want to keep reloading the same optical disk each time, because that was time-consuming. So we took advantage of Filenet caching, but instead of having a relatively small cache, we purchased a disk subsystem from EMC Symetrics to store 300 gigabytes worth of documents. Any documents referenced over the prior several days are stored in the cache.

“What we found was that for a relatively small investment,” Fornash notes, “we cut response times down to milliseconds for subsequent viewings.”

During periods when tax-related documents are being prepared by Hancocks finance department and accountants, the caching ability saves the company thousands of man-hours, says Fornash.

Before the cache was installed, users could be queued for several minutes at a time, he notes, awaiting a document to load.

“Multiply that by thousands of accesses early in each quarter, and that adds up to thousands of man-hours every year.”

Reproduced from National Underwriter Life & Health/Financial Services Edition, June 4, 2001. Copyright 2001 by The National Underwriter Company in the serial publication. All rights reserved.Copyright in this article as an independent work may be held by the author.

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