Credit a shrewd technology strategy with propelling eHealthInsurance to the top of the heap in the online health insurance business. And that strategy starts with Dr. Sheldon Wang, who has been senior vice president and CTO since 1999. Wang and his team build complex software, but he has a simple strategy, best summed up in two words: open source.
In 2000, open source was "more like a belief," he says, especially during the early days of this century. "You had to make a decision on which horse to bet on." Wang bet on open source big time and managed to convince his board and developers to go along. "There's an old Chinese saying," Wang offers, "that three regular shoemakers, working together, will have more brainpower than a genius."
Wang started his open source overhaul modestly, with Apache. Then it was on to Linux, starting with a major Oracle migration. Eventually, everything in the company was running on Linux, which has also helped with hardware costs. "We used to be 100 percent Sun. Now we're running everything on commodity machines running Linux," which means he can enjoy having Dell and HP compete to sell him cheap hardware. The final stage of Wang's grand plan will be completed this year, when eHealthInsurance completes its migration from BEA WebLogic to JBoss.
All this infrastructure supports the company's crown jewel, eHealthInsurance.com. Wang compares the site to Expedia or Travelocity, but for purchasing health insurance, not travel. "We don't have a product," he explains. "Every one of the products we sell is from the health insurance companies." That business model required Wang and his team to build a bulletproof system capable of handling disparate data from more than 160 providers.
To meet that challenge -- and beat out the many Web sites that were trying to serve the same market -- Wang realized he needed a unique, technology-driven approach. "Customers want instant gratification, and everything else online is pretty quick. So I asked myself, ‘Why is health insurance so slow?’”
The answer was twofold. Data exchange was a mishmash, with lots of paper and faxes. And insurance companies believed that end-to-end underwriting was "more art than science," so they routinely inserted humans into the process, even when they weren't needed.
Wang's solution was a proposed standard for electronic applications submission called EPI (Electronic Processing Interchange) that would allow consumers to get much faster responses from their health care insurance providers. Before EPI, according to Wang, the average time for a claim to be processed was 45 days. EPI I, which Wang and his team developed and introduced in 2001, knocked that time down to 17 days. Wang's latest brainchild, EPI III -- completed this year -- reduces it to a single business day.
"It took us all the way until December 2006 to get 95 percent of the insurance companies to use EPI I," he marvels. "Insurance is a slow industry; they are risk averse. It's not a technology problem, it's a problem convincing companies that it's the right thing to do." And Wang is very persuasive. Giant insurer United Health Care is using EPI III in 28 states, while Humana and others are getting ready to come on board.
"Technically, EPI III is completed because we've interfaced with all the underwriting systems." says Wang. "Now, the insurance companies need to be able to trust a machine to make simple decisions, rather than always relying on a human."
Unless, of course, that human is Sheldon Wang.