Six Sigma to reduce claims processing errors in a healthcare payer firm

Abstract

As a continuous improvement practice, Six Sigma has been accepted globally across the service industry. In the past decade, the application and success of Six Sigma in healthcare services has been remarkable. Despite the fact that several papers on Six Sigma have appeared in the erstwhile literature related to healthcare operations, there is a dearth of field studies highlighting the application of Six Sigma in healthcare outsourced firms, in specific to healthcare payers that engage in a non-clinical setup. The aim of this paper is to explore the role of Six Sigma within the healthcare payer outsourced firms, where error-free delivery becomes critical. The article contributes to the literature of Six Sigma in healthcare outsourcing highlighting how ‘Six Sigma as a methodology’ could help reduce claims adjudication errors in a healthcare payer firm. The Six Sigma DMAIC project case study presented as part of the paper delivered a saving of USD 0.53 million and is a classic example of how Six Sigma can bring bottom-line impact to healthcare outsourced organizations. Managerial implications and lessons learned are discussed alongside the concluding notes.

Keywords:

• Six Sigma
• healthcare
• DMAIC
• case study
• business process outsourcing

Note

Disclosure statement

No potential conflict of interest was reported by the authors.

Notes

1 Service level agreement is a commonly used term for a contract in the context of services outsourcing.

Additional information

Notes on contributors

Vijaya Sunder M

Vijaya Sunder M is a Head of Business Process Excellence at the World Bank Group, Chennai. He is a Lean Six Sigma Master Black Belt, PMP, ISO 9001:2015 Quality Lead Auditor, and Lean Facilitator. Vijaya holds his PhD in Operational Excellence from Indian Institute of Technology (IIT) Madras, a distinction holder in Master of Business Administration from the Sri Sathya Sai Institute of Higher Learning and gold medalist in Bachelor of Engineering from Anna University, India. He has led and mentored various reengineering and process improvement programs that helped improve the customer experience, employee satisfaction, eliminate process defects, increase productivity and reduce costs across service organizations. He is a Lean Six Sigma Trainer – trained more than 1500 people in Lean Six Sigma Yellow, Green and Black Belts till date. Alongside corporate job, Vijaya Sunder practices teaching for MBA students as a Visiting Faculty at the Business Schools.

Nidhin R. Kunnath

Nidhin Ram Kunnath is a Business Process Excellence Lead at the World Bank Group, Chennai. He is a Six Sigma Black Belt from ASQ, ITIL Intermediate, ISO 9001:2015 Lead Auditor and Lean Facilitator. Nidhin holds his master’s degree in Industrial Engineering from National Institute of Technology (NIT) Tiruchirappalli and Bachelor of Engineering from Kannur University. He has 12+ years of experience in driving the Service Excellence initiatives in Life Insurance, Healthcare, Banking and Retail domains. He is a Lean Six Sigma Trainer – trained more than 300 people in Lean Six Sigma Yellow, Green and Black Belt till date.