New regulations set to transform the U.S. healthcare landscape are providing strong growth opportunities for the firms that service health insurance companies.
In 2013, MarketsandMarkets valued the U.S. insurance services industry at $11.1 billion. The industry is expected to grow at a 30% compound annual growth rate (CAGR) through 2016.
Insurance services companies provide outsourced services to healthcare payers and administrators. Healthcare payers are the institutions that finance the delivery of healthcare and include insurance carriers, employers, and government entities. Healthcare administrators include managed care organizations and third party administrators (TPAs), organizations that are contracted to administer and manage health plans for healthcare payers.
These companies employ highly complex business processes, which historically have been manually intensive and prone to error. For this reason, they look to insurance services companies to manage their costs, mitigate risks, and improve the operational efficiency of back office processes, allowing them to focus on their core competencies.