Leading Health Insurer

Health insurance companies are continuously seeking to reduce their administrative costs as part of a much larger effort to control health care costs. In the United States, administrative costs represent 12 to 18% of total health care costs. For one of the largest US private health insurers, with over 11 million insured and 50,000 employees, a ripe area for cost reduction is the administration of its delegation program. Delegation is a formal process by which a health plan contracts with a health care provider to perform certain functions on its behalf, such as doctor and nursing credentialing and claims payment.

Although the insurer is able to delegate the authority to perform a function, it remains responsible to external regulatory agencies and other entities for the performance of the delegated activities. As such, the delegated health care providers are required by…