Blue Cross Blue Shield of Rhode Island has achieved a negative ROI of 45% with a new CRM system. And it is pleased with the results.

Huh? Yes, it’s true: The nonprofit insurer has all but taken a bath on the first phase of the system. “But it fit our strategy,” said CIO David Zink. “It was a cost of doing business.”

It all started when the firm, which insures 700,000 out of Rhode Island’s 1 million residents, decided to turn itself from a managed care provider to a wellness company, said Zink, speaking at the Gartner CRM Summit. Key to that strategy is tackling healthcare issues on the front end while offering greater affordability to customers.

“We’re trying to incent our customers to change their behavior to follow more healthy attitudes toward diet, exercise and so on,” said Zink. “If you want the cost to come down, do some things. Stop eating Big Macs, start exercising and take your blood pressure medication.”

That, of course, required a new system — a dual one for customers and healthcare providers–and a new approach to customer service. But the firm had to act quickly: The window of opportunity for the initial phase, which kicked in January, was five months. The second phase is now under way, and a third is to follow.

Backed with senior-level support, the Blue Cross team went to work. For one thing, it bluntly told its vendors: “If you do business with us, you’re going to modify the way you do business,” said Zink.

(The company outsources 45% of its back-office functions, including claims processing, membership, cash disbursement and IT).

More importantly from the human perspective, it didn’t fire anyone. “We could have had a 40% decrease in staff, but it’s not in tune with what we’re trying to achieve — reaching out to customers instead of responding to complaints,” Zink continued.

What did Blue Cross learn from a technical standpoint? One is to use the system as it is and not demand a lot of enhancements.

“After (the staff) used it for three or four months, the list of 300 things went down to five,” he said.

And the results? “We’ve turned our customer service department into a different organization,” said Zink. “Our customer satisfaction level is now 98%, and first-call resolution is 96%.”

Zink acknowledged that the real return on investment — better health for Rhode Islanders — may not be seen for years. But the company is willing to invest now, even to the point of offering some free tests, because it’s cheaper than the alternative.

“We’re a nonprofit regulated agency, so we can’t make a profit,” Zink concluded. “We don’t live quarter to quarter but from year to year and even decade to decade.”

Blue Cross Blue Shield of Rhode Island has achieved a negative ROI of 45% with a new CRM system. And it is pleased with the results.

Huh? Yes, it’s true: The nonprofit insurer has all but taken a bath on the first phase of the system. “But it fit our strategy,” said CIO David Zink. “It was a cost of doing business.”

It all started when the firm, which insures 700,000 out of Rhode Island’s 1 million residents, decided to turn itself from a managed care provider to a wellness company, said Zink, speaking at the Gartner CRM Summit. Key to that strategy is tackling healthcare issues on the front end while offering greater affordability to customers.

“We’re trying to incent our customers to change their behavior to follow more healthy attitudes toward diet, exercise and so on,” said Zink. “If you want the cost to come down, do some things. Stop eating Big Macs, start exercising and take your blood pressure medication.”

That, of course, required a new system — a dual one for customers and healthcare providers–and a new approach to customer service. But the firm had to act quickly: The window of opportunity for the initial phase, which kicked in January, was five months. The second phase is now under way, and a third is to follow.

Backed with senior-level support, the Blue Cross team went to work. For one thing, it bluntly told its vendors: “If you do business with us, you’re going to modify the way you do business,” said Zink.

(The company outsources 45% of its back-office functions, including claims processing, membership, cash disbursement and IT).

More importantly from the human perspective, it didn’t fire anyone. “We could have had a 40% decrease in staff, but it’s not in tune with what we’re trying to achieve — reaching out to customers instead of responding to complaints,” Zink continued.

What did Blue Cross learn from a technical standpoint? One is to use the system as it is and not demand a lot of enhancements.

“After (the staff) used it for three or four months, the list of 300 things went down to five,” he said.

And the results? “We’ve turned our customer service department into a different organization,” said Zink. “Our customer satisfaction level is now 98%, and first-call resolution is 96%.”

Zink acknowledged that the real return on investment — better health for Rhode Islanders — may not be seen for years. But the company is willing to invest now, even to the point of offering some free tests, because it’s cheaper than the alternative.

“We’re a nonprofit regulated agency, so we can’t make a profit,” Zink concluded. “We don’t live quarter to quarter but from year to year and even decade to decade.”