Healthcare payers face a variety of pitfalls when implementing digital transformation efforts. These common mistakes can have a big impact on operational efficiency and business risk. Know these common mistakes and avoid them to ensure success in digital transformation.

Common Mistakes Observed in the Payer Market

Digital transformation tools can help you store data in the cloud securely, comply with federal and state healthcare regulations, and increase transparency in healthcare quality and costs. However, with digital tools come important considerations.

Some of the common mistakes seen among healthcare payers approaching digital transformation include:

  • Focusing on their app or solution first, and then trying to build security and compliance around them as an afterthought in the process
  • Not including key stakeholders throughout
  • Not engaging their vendor management organization early enough
  • Trying to succeed in digital transformation alone instead of tapping the expertise of partners

Including Security and Compliance Only as an Afterthought

As with almost anything in healthcare, you must remember to include compliance in every digital transformation effort. Too many organizations concentrate on building their app or solution first, and then try to fit compliance to the solution. Compliance needs to be steeped into the culture of an organization and the products and services you use, as well as front of mind when you’re architecting your digital environment. It’s a good idea to work with partners who have compliance baked into everything they do.

Not Engaging Stakeholders

Engage all stakeholders throughout the digital transformation process. If not, your digital transformation efforts are likely to have blind spots and siloed information that erode your ability to succeed. The sooner you engage key stakeholders, the more successful you will be. That’s especially true for executive staff such as the CISO (Chief Information Security Officer), who is legally obligated to be sure any security risks are taken into account in your planning and implementation.

Involve Your Vendor Management Organization 

One of the items that ends up being the biggest hurdle with payers is the contracting process. Payers, particularly large insurance companies, usually have a large vendor management organization (VMO) in play for contracts, business associate agreements, and other legal documents. You want to involve that group early on, so its team can advise ways to speed time to contracting and thus, time to value. Ask your VMO what it needs for legal, procurement, IT or other and business units early to ensure success.

Not Leveraging the Expertise of Others

Other industries have mature digital transformation technology, so work with partners who have already achieved success to help you. You don’t have to “reinvent the wheel.” Tapping others who already have digital transformation expertise will not only save you time and money but also help ensure your efforts are successful. Forbes labels these people as “digital achievers,” and they may not always be found only in an IT department. Whether they come from within or outside of your organization, these digital transformation “achievers” have the unique ability to understand the basics of working and competing in a world revolutionized by technology and can solve problems from the customer’s perspective, not just their own.[i]

Digital Transformation Challenges Facing Payers

As they grow, many payers struggle with how and what data to migrate to other systems. They grapple with what should be in their data center and what should move to the cloud. Some believe they can do the job themselves, while others realize they need to turn to look for outside assistance. Strongly consider leveraging the expertise of a partner to ensure business agility and scale.

Benefits of Successful Digital Transformation

Without digital transformation, both payers and providers face a bit of a bleak future as healthcare costs, especially for chronic care, continue to rise. The Centers for Disease Control states that 70 percent of healthcare costs spending is on chronic disease.

Personalized care through digital transformation can help prevent or better manage chronic disease.

The end result is healthier, happier members at a lower cost.

The impact of the failure to pursue digital transformation efforts, such as personalized care, can be illustrated by the statistic shared recently by CNBC that indicates two-thirds of people who file for bankruptcy cite medical issues as a key contributor to their financial downfall. Many Americans who have health insurance can’t even afford to pay the out-of-pocket expenses that accompany their insurance plans. Because care is costly, many people wait to seek care until later in an illness where more expensive hospitalizations are required vs. the more engaged preventative care possible with digital technologies.

But when done correctly, digital transformation can provide you with big benefits. It can increase transparency, improve healthcare quality, reduce costs, and provide new ways for you to connect with consumers.

Digital transformation programs can increase your profitability. Research shows the high revenue, high margin business that many in the healthcare industry traditionally have relied on is going away, but the digitally transformed organization using big data or machine learning can see increased efficiencies. Even conservative numbers suggest the healthcare industry’s digital transformation efforts stand to generate $300 billion in savings industrywide[ii], and that’s a conservative savings estimate. Either way, digital transformation can give you a competitive edge over others in your market.

The New Digital World

Digital transformation is changing the way payers do business and revolutionizing patient care in an era where the economics of healthcare are shifting. As patient outcomes and healthcare costs come under increasing scrutiny, payers must be able to manage their operations in as efficient and transparent a way as possible while still meeting the many security and compliance regulations governing them.



[i] Forbes, Aug. 24, 2018 (

[ii] Forbes, March 7, 2017 (