Lovelace Health Plan, a 200,000-member plan owned by the Albuquerque, N.M.-based Lovelace Health System, has signed a six-year business process outsourcing contract.
The TriZetto Group will provide BPO services to the provider-owned plan and its roughly 200,000 members in New Mexico.
Under the agreement, TriZetto, based in Newport Beach, Calif., will provide BPO services on the company's hosted and managed Facets enterprise administration system. Other hosted systems will include TriZetto's NetworX Suite, Facets Workflow and a TriZetto module that will streamline service of Lovelace Health Plan's Medicare population.
Lovelace officials expects to complete the transition to TriZetto's applications and services by October 2010.
"By consolidating systems and vendors and entrusting TriZetto to manage both our software and our processes, Lovelace will have better insight into key data and trends and can increase its attention on areas that differentiate us from our competitors, including our constituent engagement and delivery of high-quality care through an integrated delivery network," said Bob Skinner, assistant vice president of information technology at Lovelace Health Plan.
The significant BPO investment by Lovelace is characteristic of a trend among healthcare payers, according to industry analysts.
"U.S. healthcare insurers are more frequently considering BPO as a strategic option, turning it from largely the exception to a more accepted norm," said Maureen O'Neil of Gartner, Inc., in the February 2009 report, "Healthcare Insurance BPO Market Ready to Take Off."
In 2009, more than 60 percent of healthcare payers surveyed by IDC Health Insights reported business process outsourcing initiatives, according to the IDC Health Insights' March 2009 report, "BPO Adoption in the Healthcare Payer Market, 2009."
Lovelace officials said they intend to use the full suite of TriZetto's BPO services, including claims administration, enrollment administration, billing and financial reconciliation, business rules configuration and mailroom services.
The health plan will leverage TriZetto's application hosting services to manage TriZetto, custom and third-party applications. As part of the agreement, TriZetto will perform a wide range of application implementation and optimization services, including configuration, data conversion, custom development, testing and training.
The Lovelace Health System is a network of three acute-care hospitals, an accredited rehabilitation hospital, 11 neighborhood Lovelace Pharmacies, SED Medical Laboratories and Lovelace Health Plan, which includes Lovelace Senior Plan, Lovelace Insurance Company and Lovelace Community Health Plan.
Lovelace is a wholly owned subsidiary of Ardent Health Services. Based in Nashville, Tenn., Ardent owns a network of health systems and hospitals in New Mexico and Oklahoma.