The Anatomy of Voluntary Benefits Billing Software

Robust voluntary insurance billing software solutions improve billing accuracy, reduce administrative time and billing rework, and ultimately lead to better customer satisfaction. Accurate premium calculations and seamless billing operations are the cornerstones of a successful insurance offering.

The following guide will navigate you through the crucial aspects of billing for voluntary benefits insurers. From configuring billing rules to integrating with core systems, we’ll explore the key components that can enhance your billing operations. 

Here are some of the valuable aspects of voluntary insurance billing software:

Overview: Voluntary Insurance Software

Calculate Rates

When generating invoices for some voluntary products, rate rules drive the premium values. Flexibility matters. Billing systems typically receive rates in two ways. If the system that manages coverage has access to the premium rates, the billing system can acquire that information as part of a consumer’s enrollment record. Establishing a rate structure in the billing system is unnecessary in this case.

Or, the billing system can establish a rate table matched to consumers and their coverage records to determine receivable and payable rates used in the billing process. This rate table functionality should contain a significant amount of flexibility. Segmentation should be available by customer population, carrier, product, coverage tier, age band, consumer type, geography, subsidy status, and other attributes.

Integration to Streamline Enrollment/Eligibility Data Exchange

Poor data integration traditionally leads to inaccurate billing. Your billing system should integrate with your existing systems – like core administration, policy management, or eligibility systems.

Integration flexibility is the key. You may need a flat-file integration with one system and an API integration with another. Your member portal may require a single sign-on integration. You may even need to integrate billing rules from an external system into your billing platform. 

Also, consider the frequency of the eligibility data integration. Some integrations may use a daily file feed, while others are less frequent. Ensure your billing platform can handle the import frequency required.

Configurable Billing Rules

Many voluntary insurers still require development time to modify existing billing rules. This process wastes time and can impact time-to-market for new products.

Look for billing solutions that have configurable billing rules. That may include partial payment rules, grace period rules, pro-ration rules, retroactivity rules, and more. Those rules should be able to be configured at multiple levels, like for different lines of business.

Accounting Design

Inaccurate invoicing impacts operational efficiency and financial performance. Instead of repurposing list billing applications, billing solutions should couple debits and credits in each transaction set to eliminate the errors that plague insurance premium billing systems. 

That accounting design improves billing, payment, and commission accuracy, especially for retroactive adjustments. But it also leads to better downstream reporting – like feeds to the general ledger – delivering a better view of your financial performance.

Self-Bill Capabilities

Most voluntary insurers offer both list bills and self-bills to their customers. Your software should make it easy for groups to self-report enrollment numbers, calculate the premium amount, and facilitate payment.

Self-bill capabilities should include:

  • The ability to enter headcount or volume on a secure webpage, prepopulating with the prior month’s data to streamline the process
  • The ability to enter retroactive adjustments to prior periods, if allowed
  • Functionality to calculate the payment due and generate an invoice
  • Facilitate payment based on that premium calculation.

Group and Individual Billing Capabilities

Though most voluntary billing activities likely involve billing groups, some voluntary products are portable. As a result, any billing platform you use needs to support both group and individual billing.

Though there are similarities between the two billing audiences, they do have differences. If you designed your billing solution to manage group billing, you may not offer payment options – like credit cards or retail cash payment – that simplify the payment process. Or, you may not have an integrated delinquency management process. 

Conversely, group billing requires unique capabilities, like consolidating billing at different organizational levels – like by location or department – based on client reporting needs. Or, you may need more robust role management capabilities for your staff. Invest in a billing solution that can manage both group and individual billing.

Consolidated Billing

If you bundle multiple products into groups or individuals, consolidating those bills streamlines the customer experience. Your billing solution should be able to consolidate billing to meet client requirements.

That consolidation may need to happen at different locations or department levels. As a result, your solution should leverage multiple hierarchies to display consolidated billing information at various levels.

Multiple Invoice Communication Methods and Designs

Your group clients may have unique invoice requirements. As a result, your billing platform should simplify the invoice design process. Most best-in-class solutions leverage an engine that enables configurable page elements on the summary invoice page. For any detail pages, grids enable the insertion of data elements, while rules define how summary data is displayed.

Invoice communication methods are also important. Software that enables you to choose from print or email invoices and delinquency communication improves the customer experience while improving timely payments.

Integrated Payment Portal

Building or buying a separate payment portal adds cost to your billing process. Instead of allocating internal resources or integrating an off-the-shelf solution, consider solutions that have integrated payment portals.

Those portals should enable customers to at a minimum:

  1. Setup payment methods and auto-pay
  2. Make one-time payments
  3. View current and past invoices

Look for billing platforms that enable a single sign-on experience so you can seamlessly pass users from your existing member portal. 

Broker Commission Calculation and Remittance

You likely need to pay commissions on some of the premiums you collect. A solution that calculates those commissions based on premiums paid – whether a flat fee, a percentage, or a spread – and generates payment files can streamline your commission process.

Plus, because software bases commissions on premiums collected, they’re based on payments made, not expected. By leveraging software that includes commission calculations, you enable faster commission payments, improving broker satisfaction.

General Ledger Integration

Finally, consider a general ledger integration. Configuring the billing platform to provide general ledger entries on a predetermined schedule is the most common integration method. For example, send billed revenue when invoices are generated and made available, and dispatch collected cash when you remit payments to administrators, brokers, or other entities receiving payment. 

A general ledger integration can take several forms but is generally a custom electronic interface sent by the billing platform according to a schedule. Software should provide detailed or summarized information, and rules help to categorize transactions appropriately.

When entering manual adjustments, users specify all the same attributes of a transaction (month/year, plan, consumer, group, etc.), which allows the system to use the same categorization rules. In addition, each manual adjustment has an attribute that identifies the type/reason for the adjustment – like a write-off, service credit, etc. – which can be considered when sending transaction details or summary information to the general ledger system.

Certifi’s voluntary insurance billing software helps voluntary insurers improve member engagement while reducing administrative costs.


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