1 bary bailey evp, chief strategic officer.…a health and consumer services company making...
TRANSCRIPT
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Bary BaileyEVP, Chief Strategic Officer
.…a health and consumer services company making people’s lives better
Systems & IT Outsourcing
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PacifiCare’s Future State
• PacifiCare’s Future State is a measured, programmatic set of business and technology projects that enable our competitive product leadership strategy
• The company requires business and technology change and investment
.…a health and consumer services company making people’s lives better
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This is what our business users want...
Objectives
Key Requirements
• Rapid product deployment
• Increased operating efficiency
• Flexible and scalable systems
• Customer and member product flexibility and choice
• On-time, one-time and, eventually, real-time claims processing
• Robust medical management
• Consistent and complete customer interaction
• Information managed and used as a strategic business asset
• Standard business practices
.…a health and consumer services company making people’s lives better
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But our historical perspective made it hard to deliver...
• Multiple systems– Duplicative support and investment requirements– Limit business process transformation
opportunities
• Old “2nd tier” technology limits:– E-business transformation opportunities– Ability to rapidly deploy new products – Deployment of vendor-supported applications
• Consumes scarce IT resources on activities that do little to advance business strategies
Core Legacy
#1
EnrollmentBilling
CapitationClaims
AuthorizationsReferrals
EnrollmentBilling
A/RCapitation
ClaimsAuthorizations
Referrals
EnrollmentBilling
A/RClaims
AuthorizationsReferrals
DATAWAREHOUSE
DATAWAREHOUSE
Internet Sites
ED
I
ED
I
VR
U
Inte
rnet
Sit
e #1
Database Database Database
ENTERPRISE WIDE SHARED IT RESOURCES
Applications Technologies
User Interface
Ancillary
Ancillary
Ancillary
Ancillary
Ancillary
Ancillary
Ancillary
Ancillary
Ancillary
Ancillary
Ancillary
Ancillary
Ancillary
Ancillary
RegulatoryReporting
RegulatoryReporting
User Interface
User Interface
Core Legacy
#2
Core Legacy
#3
Inte
rnet
Sit
e #2
Inte
rnet
Sit
e #3
.…a health and consumer services company making people’s lives better
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So we created some rules for change...
– Consistency will prevail over variation
• Process
• Systems
– Commercially available software
– No desire to be bleeding edge
• Core business - proven technologies and stable vendors
• Non-core business - lower cost and acceptable levels of performance
.…a health and consumer services company making people’s lives better
– Information management and use
• Mission-critical
• Corporate asset
– Access strategy driven by business
• Efficient solutions to meet customer demands (e.g., Internet, telephone, EDI, IVR)
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• The Future State is a set of business and IT transformation projects that will:
– Consolidate - eliminate the deployment of redundant applications and technologies
– Rationalize - migrate to common applications supported by standardized business processes
– Innovate – identify and deploy applications and technologies that promote business transformation
– Organize – provide a framework for future business and IT investments
TECHNOLOGY INFRASTRUCTURE
ENTERPRISEACCESS
ENTERPRISE APPLICATION INTEGRATION
Business Logic/FunctionsBusiness Logic/Functions Business Logic/Functions
Acc
ess
to P
HS
Consumers
Brokers
Employers
Employees
Providers
Members
Cu
stom
ers
PBHI PDVRxSol
RxConnect Health
Plan TBD
Data Mart
DataWarehouse
ENTERPRISE INFORMATION MANAGEMENT
Enterprise Information Repository
Data Mart
DataWarehouse
EDI
Paper/EDE
Internet
Intranet
VRU
PartnerConnectivity
ENTERPRISE ACCESS
.…a health and consumer services company making people’s lives better
And we set a direction towards the Future State…
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2001 2002 2003 2004 2005 2006Future StateActivity Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4
Outsourcing
Process ImprovementCore SystemsImplementation
Rating & Underwriting
AccountingConsolidation
Financial Planning
Integrated FinancialSystem
Service CenterConsolidation
Customer ServiceSolution
InformationManagement
Enterprise Access
System Selection Core Legacy Migrations
Milestones
Future State
Key Business Driver
We established a plan of attack…...
.…a health and consumer services company making people’s lives better
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And we have made good progress thus far...
• Outsourcing contract finalized and transition is well underway
• Currently implementing several Future State projects
• Final decision on Core Systems and Financial Systems to be made in near term
.…a health and consumer services company making people’s lives better
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Outsourcing will bring benefits to the business…
• Facilitate the delivery of Future State
• Reduce/control operating expenses
• Improved performance and speed of delivery
• Access to “world class” capabilities
• Increased funding through efficiency improvement
.…a health and consumer services company making people’s lives better
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Software Engineering Institute - Capability Maturity Model (SEI-CMM)
Typical
PacifiCare(Pre-Outsourcing)
Low
Exceptional
Medium
High
With Outsourcing(After 12 months)
1.8
.…a health and consumer services company making people’s lives better
And independent experts concur...
3.0
11 .…a health and consumer services company making people’s lives better
We maintain control, but have developed strategic partnerships…
• CGE&Y - Future State Strategic Planning
• Keane, Inc - Application Maintenance and Enhancements
• IBM - IT Infrastructure
12 .…a health and consumer services company making people’s lives better
And we have aligned our structure to support Future State
– Future State • Combined business and IT organization• Retained resources and control of strategy, architecture
and investment decisions
– Ongoing IT Operations• Outsourcing supplier management• Systems oversight
Questions & Comments