Len Rosenblum, Senior Director
CareFirst BlueCross BlueShield
The Federal Employee Program (FEP) actuarial team is continually challenged with the ability to price benefit modifications and new benefit plan designs. The team had an out-of-date mainframe-based tool for pricing analysis that was not keeping up with their business agility and functionality needs. As a result, the actuarial team spent a lot of time working around the capabilities of the system pulling information together from multiple sources to perform the analysis required. When conversations began regarding the introduction of a brand new product, it was clear that the current tool would not suffice for complex pricing analysis.
The new Benefit Pricing System (BPS) enables actuaries to analyze benefit category usage from prior years’ data and evaluate the impact of changes to the copay, coinsurance, deductibles and catastrophic maximum limits. The system, which was developed collaboratively with the actuarial team using an agile approach, has three main components: 1) data loading and summarization: integrates prior year’s claims data into Hadoop and summarizes by benefit category; 2) data entry: enables users to enter cost share scenarios that apply copay, coinsurance, deductible and maximums to each benefit category; and 3) reporting and analytics: enable users to run reports directly against Hadoop that display selected metrics by multiple benefit category combinations applying the chosen cost share scenario.
BPS enables FEP actuaries to be more efficient in their benefit planning tasks by reducing the time and manual steps required to perform critical benefit pricing analysis. This new system provides greater flexibility to keep up with business changes though a data-driven architecture and self-service approach that reduces the time to market for benefit design changes. The enhanced reporting and analytic capabilities enabled a much more efficient process for design and pricing of the new product within tight time constraints.