CUSTOMER SERVICE CENTER OPERATIONS UPDATE

Prepared for Operations Committee

March 2015

2

Topics

• Current Forecast

o Background

o Forecast

o Primary cost drivers

o Cost reduction activities

o Next steps

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Background

Current approved budget for service center is $14.9M

$0.3M Approved in December 2014 for additional HCPF resources

$0.9M Approved in November 2014 for CGI/C3 due to changes in SCLSP

$13.7M Approved in initial budget

$14.9M Total approved budget

Throughout the fall, staff presented forecasts for FY2015 of between $15.2M and $17.9M, but recommended the Board approve incremental increases to allow us to continue to look for ways to reduce costs over time.

At the February operations committee meeting, staff recommended an additional $2.8M to fund the service center through FY2015. The committee:

- Denied the request

- Asked staff to provide a recommendation in March for additional funding needed to support the service center through April 2015

- Asked staff to provide an update in April on activities being taken to reduce service center costs for the remainder of FY2015 and FY2016.

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Actual

Costs

Fixed costs plus forecasted variable

costsCosts incurred

but not

invoiced / paid

Current Customer Service Center Trend – FY2015

Key Assumption:• We could reduce budget from FY14 through efficiencies and maintain

current ASA, AHT and abandon rates throughout FY 2015.

$5 M

$10 M

$15 M

$20 M

$25 M

JUL AUG SEP OCT NOV DEC JAN FEB MAR APR MAY JUN

FY14 Actual

FY15 Budget

FY15 Trend

$21.14M

$17.71M

$14.88M

$4.13M Gap between budget and actual

Total invoiced through Feb 2015 ~$14.9M

$6.2M gap between forecast and budget for FY2015

Forecast through April 2015 ~$18.37M

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Increase in forecast

• February forecasts of $18.11M have increased to $21.14M

o Revised forecast – the $18.11M forecast assumed that we could reduce total head count to approved budget levels beginning in February.

o Given volumes of calls, emails, new tax questions and escalations, this would result in an unsatisfactory level of service for customers.

0

50

100

150

200

250

300

350

February Average March Average April Average May Average June Average

Total Service Center FTE Count

February Forecast

Current Forecast

Ramp down of service center staff started on 3/2/2015

Activities driving need for >100 total call center staff at end of open enrollment:• Projected 2-4K/month LCE requiring support• Ongoing SES and RMC challenges• Verifications activities • RRV outbound calls • 1095 questions • Potential SEP in April for tax filers• SHOP enrollments, changes and invoicing • Support for operational activities such as simultaneous

enrollment and carrier reconciliation

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Customer Service Center Cost Drivers

Open Enrollment Cost Drivers • Eligibility determination

issues• Medicaid/CHP+

questions • 1095 questions • Completing enrollments • Renewals• Life and account

changes

Pre-OEP Cost Drivers• Life change events (4K/month)• Notices about changes in APTC

due to market dynamics (Oct-Nov)

Post OEP Cost Drivers (current and projected) • Eligibility determination issues and

backlog cleanup• Medicaid/CHP+ questions • Completing enrollments • 1095 questions • RRV questions • Simultaneous Enrollment outbound calls • Verifications processing • Life and account changes• Potential Special Enrollment Period in

April for tax filers

$5 M

$10 M

$15 M

$20 M

$25 M

JUL AUG SEP OCT NOV DEC JAN FEB MAR APR MAY JUN

FY14 Actual

FY15 Budget

FY15 Trend

$21.14M

$17.71M

$14.88M

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Call analysis and cost drivers

Additional Cost Driver: Resolution of issues encountered by customers while enrolling in a QHP with financial assistance • During the 2015 Open Enrollment Period, the service

center received and resolved between 8-10K incidents (reports of issues – not the same as customers) for customers who had problems/questions either with their eligibility application or with using their eligibility result to shop on the Marketplace. Resolution of these incidents often required coordination between service center representatives, IT resources, back-office staff and HCPF contractors and took between 3-4hrs on average.

40,500 , 45%

42,075, 47%

7,425, 8%

Breakdown of calls to the Individual Sales (based on survey of call center representatives working the individual queues)

Non-Marketplace (i.e.,Medicaid)

Marketplace - FinancialAssistance

Marketplace - Non FinancialAssistance

Non-Marketplace calls and chats• Service center representatives reported that between 65%

and 70% of all chats serviced by the service center were for customers who are eligible for or receiving Medicaid, CHP+ and other HCPF program benefits

• Service center representatives reported that between 40% and 45% of all calls serviced in the Individual New and Individual Sales queues were for customers who are eligible for or receiving Medicaid, CHP+, and other HCPF program benefits

Call Details - Financial Assistance Customers (based on sample of ~100 calls) • Average call time - 1hr 19minutes 54seconds • Average SES component of calls – 35minutes 3 seconds

Call Details – Non Financial Assistance Customers (based on sample of ~100 calls) • Average call time – 30minutes 19seconds

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• Work with HCPF to determine appropriate allocation of costs due to eligibility issues and number of Medicaid calls

• Closely monitor call volumes and costs and scale down FTEs earlier if opportunities arise, while working to maintain an SLA closer to 80/90 (in progress)

• Look at using lower cost resources (e.g., Tier 1 resources) for simple calls and tasks (impacts being evaluated)

• Reduce number of QA staff by 1 (part of planned ramp-down beginning in March)

• Close our customer service center on weekends beginning 3/7 to eliminate utility and staff costs for potential of up to ~$80K savings for FY 2015 (not started)

• Shorten service center hours during work week (impacts being evaluated)

• Streamline back-office processes for problem resolution (impacts being evaluated)

• Review technology costs for options to reduce (not started)

• Continued review of call drivers and call scripts to reduce AHT (in progress)

• Tighter resource forecasting to reduce use of overtime hours (in progress)

Planned activities to reduce costs for FY2015

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General actions to reduce costs for FY2016

• Renegotiate contract

o Tighten SLAs

o Improved forecasting for predictable ‘transactional’ activities

o Renegotiate rates and other cost factors

• Determine appropriate mechanism for recovering costs spent serving Medicaid customers

• Look at other options for handling SHOP back office and customer service functions

• Improve technology integration for customer service center functions

o Incident information available to customers ?

o hCentive and OCX integration for key data?

o IVR self-service and authentication?

• Review and rationalize end-to-end contact management process for complex customer-facing activities

• Look at call trends over last two years and determine if hours of operation need to be modified

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Specific actions to reduce costs by area

Transactions • Password reset

• Questions and general support

• Some easy account changes

• Verifications processing

• Mailroom

‘Case Activity’• Eligibility issue resolution

• Some enrollment issues

• Life changes that cannot be completed online

SHOP Activity:• Invoicing

• Manual changes to support employee changes

~10% of costs

~55% of costs

~35% of costs

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Other thoughts?

• Re-evaluate expectations around the role of a Service Center in a Marketplace – not a typical call center