When MedUnite opened its doors in March 2000, resources were pretty thin for the San Diego, California-based technology firm. America’s leading health insurance firms – Aetna, Anthem, CIGNA, Health Net Inc., Oxford, Pacificare and Wellpoint Health Networks – created this consortium to provide a Web-based connectivity tool for handling healthcare transactions, such as claims processing, pre-certifications, eligibility verification and electronic payments. Physicians, insurers, laboratories and other healthcare constituents use the tool which replaces an inefficient paper system.
According to Randall Morrison, MedUnite’s VP of sales for the Western Region, the company has about 30,000 doctors and 300 insurance companies in its network, together with hospitals, practice managers, payers, diagnostic and other ancillary services.
“Basically, we are a clearing house for our members to file insurance claims electronically. We typically handle about eight million transactions a month,” he explains.
With this much activity and a growing subscriber base, Morrison says the firm needed a CRM solution that would do a great job of managing its customers. It needed to be affordable, easy to use and quick to implement.
There was not much of a selection process involved when Morrison chose Salesforce.com, an ASP-based CRM provider headquartered in San Francisco, California, since he had used the product at a previous company.
“I signed myself up in 2001, did the trial and liked it. I started rolling it out to the rest of the sales team in April 2002. They all seem to really like it, so we are thinking of rolling it out to the rest of the company, he says.
Why Customers Prefer an ASP CRM Solution
Salesforce.com allows companies to automate their sales, support and marketing operations in a short timeframe, lowering costs. Customers get a CRM system that is continually updated and enhance — without infrastructure hassles.
A Web-based service model provides many benefits over traditional systems, since customers do not need hardware or software installation or an IT team to provide configuration and support. Customers can be up and running in days, even in multi-national rollouts with an ASP-based product, says Dave Moellenhoff, CTO, Salesforce.com. Conversely, deployment can take many months with traditional CRM systems.
“Client-server CRM applications have had a decidedly mixed track record. They are expensive to buy, require extensive consulting resources and are difficult to maintain and support,” he says.
Web-based solutions are the new trend in CRM, “transforming the traditional marketplace by offering solutions available over the Internet for a subscription,” says Sheryl Kingston, an analyst at The Yankee Group, a research and consulting firm for communications and IT products based in Boston, Massachusetts. “The emergence of these alternative application vendors has fundamentally changed the way software is built, delivered and supported,” she explains.
How MedUnite Manages Its Outsourcing Relationship
MedUnite has signed a multi-year contract with Saleforce.com for a certain number of users. It has the option to increase that number, which Morrison says the firm is considering.
There are no service level agreements in this arrangement. The outsourcing relationship is jointly managed by Salesforce.com’s account management team and MedUnite’s IT department.
As for the benefits, Morrison estimates the firm has saved, at minimum, 25 to 35 percent in administrative time. For example, in the provider division, the consortium had a part-time employee working about 40 hours a month compiling information. Its sales reps spent at least one day a month gathering data for different reports, he explains.
With Salesforce.com, the company has completely eliminated the need for this. MedUnite now generates reports automatically and customizes them as it needs. Morrison says this saves a lot of time and money and the information is always timely and relevant.
Kingstone says that with longer sales cycles and intense pressure to win new customers, managing the sales process strategically is more important than ever. However, simply tracking contact and opportunities is no longer sufficient.
“Today’s sales solutions must leverage new Web architectures for real time visibility and provide operational functionality focused on improving sales effectiveness to drive sales cycles and increase revenue,” she says.
Morrison says that having all contacts and sales leads in one central repository, means sales employees can get more information faster than before. Additionally, MedUnite makes use of Salesforce.com’s offline version.
“We love the offline edition because we can take it with us. The information is available anywhere and everywhere. When we’re without high-speed connections, offline allows us to update information, sync it up and walk away,” he explains.
MedUnite is also using Salesforce.com for its Web-capture functionality, which automatically captures and appropriately assigns details of those signing up on MedUnite’s Web site to the database. The system then tracks the entire process, from lead generation to implementation. “You could say we’re using Salesforce.com to manage the lifecycle of a client from embryo to birth to baby – without having to re-key information when there are transitions,” says Morrison.
He says that outsourcing CRM has proved a viable way to keep costs down as well as have access to a powerful system and product. “Maintaining an in-house CRM system is not feasible for a new company like MedUnite and the ASP is a sound model. We’re also very attuned to helping companies control their costs, as MedUnite has been built on the principle of outsourcing its own services,” he concludes.
Lessons from the Outsourcing Journal:
- ASP model reduces installation costs associated with in-house/ client-server CRM systems.
- Customers get a CRM system that is continually updated and enhanced with no infrastructure needed beyond browsers and Internet access.
- Customers have immediate access to trained personnel, reducing hiring and training costs.