Zemo Trevathan and Associates, Inc.Zemo Trevathan and Associates, Inc.
Business Value Analytics - Case Studies
Optimizing Claims Processing Training
Managed Health Care Company Improves New Hire Retention and Saves $1.5M by Improving Training Effectiveness
The Business Challenge
A top-tier regional managed healthcare provider was preparing to make a company-wide migration to web-based claims processing software and had set a very aggressive timeline for software rollout and implementation. The existing training used to train Claims Processors took six weeks with a high concentration of mentoring. Faced with a need to completely redesign the training curriculum for new hires as well as rapidly train existing employees, the department knew that they had to figure out how to reduce both the length of the training as well as the need for mentoring during the process. They approached us evaluate their current training program, to measure its effectiveness, and to make recommendations on how to successfully redesign their claims processing training program.

The Zemo Trevathan and Associates Solution
Our first step was to help them identify what was really worth measuring, based not only on their own internal metrics, but based on the value they delivered to their internal customers. They were making one of the classic mistakes of service groups, assuming that if they could provide their service (well-trained claims processors) to their client faster (and thus at lest cost) they would be succeeding. We worked with them to identify three other measures of the value that they provided beyond potentially shortening the length of training and mentoring: number of claims processed, error rates, and attrition rate of new employees.

Looking at these value-oriented metrics, the training department realized that decreasing the length of time required for training and mentoring would only be of benefit to the company if these other metrics also improved, or at least held steady. As we collected the metrics on the current training program, attrition rate turned out to be a very significant metric, we learned: 40% of new hires had left within two months, most of those while they were still in their initial training. This represented significant recruitment and hiring costs to the company, as well as being a waste of training investment. We added improving this metric as a priority for the redesign.

In seeking to redesign the claims processing training, we did not want to rely on the new web-based technology as the only driver of improvement (which is another classic mistake many companies have made). We went back to the drawing board and completely re-conceptualized what was needed from their claims processing training, beginning with a core competency list for claims processors. We mapped out training sequences that would address the core competencies and benefit the key metrics, and rolled out a pilot of the new training.

The pilot training lasted 3 weeks, which marked a 50% improvement (in time and cost) on the existing training. The new trainees performed comparably to their predecessors in terms of speed and error rates on tests. And, although the measurement time frame was short, the pilot group demonstrated a much lower attrition rate.

As a result, the department rolled out our training as their new web-based claims processing training with demonstrated savings to the company of $1.5 million over the next year. These savings were partly generated via the reduced length of training and mentoring from 6 weeks to 3 weeks. But a much larger portion of the savings was contributed by the startling improvement of new hire retention: the attrition rate of new hires dropped to 8% from 40%. The company opted to not actually measure the other performance metrics, but the general perception was that in addition to savings, that they were delivering a better-trained, more effective workforce. The total cost of our measurement and redesign project was $120,000, yielding a project SOI (Savings On Investment) of 1300%.
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Zemo Trevathan and Associates, Inc., 111 Standing Rock Road, Chapel Hill, NC  27516
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CASE STUDY SUMMARY

The company experienced 1300% SOI (Savings on Investment) on a project to redesign their claims processing training based on performance metrics. Originally setting out merely to shorten the training, they hired ZTA to evaluate their current training based on value provided to their customers, and to redesign the training with an objective of increasing that value. The training was successfully cut from 6 weeks to 3 weeks, and as a direct result of the improved training, new hire attrition was reduced from 40% to 8%.

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