What Facebook Can Teach Payers About the Business of Integration

Posted by Ken Pedersen - 12 June, 2013

By Ken Pedersen, Executive Management and
Kenton Bohn, VP & Healthcare Practice Lead

Today, the need for a health insurer to have the ability to quickly respond to regulatory and operational complexity requires it to be aligned internally – capable of sharing information and business intelligence across operating units in real time. But just as important, it must be aligned externally – equally capable of sharing real-time information and intelligence with an increasingly diverse network of customers, partners and regulators.

Health insurers must be able to quickly and cost-effectively manage this chaos by extending existing business processes and systems instead of engaging in re-writes or new developments (at least until they know exactly what needs to be built). These extensions, however, can't come at the cost of system-level development or modifications. This deep level of development cannot occur fast enough to capitalize on new market opportunities. The natural tension between the business and IT organizations can't come into play every time a new regulation requires change or a merger/acquisition demands a new level of integration.

It’s helpful to think about how health insurers can best manage this complexity in technical terms – specifically, in terms of the Application Programming Interface (API). While APIs have traditionally been the realm of software developers, they are quickly becoming critical to the business in areas well beyond traditional software development, including strategy, operations and customer service.

Today, APIs have become the hubs through which increasing volumes of transactions and data travel. These new hubs are providing the flexibility to adapt to changing market conditions and capitalize on business opportunities in a matter of hours or days, not weeks or months. APIs have become centers of business innovation, enabling near real-time problem solving.

If this sounds like APIs enable a minimum viable product (MVP) approach, that's not far from the core value of this transition.

Let's look at an example.

Facebook is one of the (if not the) fastest growing platforms in history. Today, Facebook reaches more people on the planet than any other system. Without an API-first approach, Facebook wouldn’t have realized its tremendous growth. It's that simple.

When the Facebook team wanted to dramatically expand their reach, they didn't launch a marketing program or an ad campaign. Instead, Facebook published a robust set of APIs that enabled web developers and other businesses to utilize key Facebook functions – initially within their sites, and eventually within their apps. The complexity of Facebook was simplified into APIs that provided access to the “Like” button functionality and, most critically, login credentials. Very quickly it became easier for developers to enable their customers to log in to their apps and websites with a Facebook ID than to support the creation of new account credentials. Almost overnight, Facebook logins became a default feature requirement for product design. Facebook was ubiquitous.

This is admittedly a simple example. It is also an important one.

Let's look at another, more relevant example.

When the Department of Health and Human Services (HHS) wanted to stimulate innovation around health data, it didn't publish static data and statistics via CSV files. Instead, HHS published a robust set of APIs that enabled anyone to use HHS data. This API-first approach unquestionably cost HHS more money (and time) than a data-first approach. Given the increased costs, why did it choose to use APIs instead of providing static data?

HHS chose APIs because APIs offered developers the fastest, most flexible tools to put the data to use. HHS wasn't interested in only one interpretation of its data. Rather, HHS was interested in the easiest, fastest and broadest potential use cases – the most innovation possible, if you will – to help organizations create new solutions, streamline processes, improve care and lower costs.

On the heels of the historic HHS API initiative, the discussion of APIs in healthcare has reached all-time highs – for good reason.

APIs have become business tools, tools for which the business and IT must work closely together to align strategies, objectives and requirements in order to be successful.

Healthcare, specifically the health insurance industry, is sitting on the brink of a revolution. As such, a health insurer's APIs must be in perfect alignment with the structure and strategy of the business to aggressively address the chaos and opportunity revolution presents.

Today, APIs are business decisions.

Are your APIs ready for the changes your business is about to experience? This is a question you'll need to answer in very short order.

We would welcome the opportunity to speak with you. Please complete the inquiry below and we'll be in touch.

Topics: communication, leadership, software development, Technology

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