There aren’t many businesses that allow customers to determine how much they pay for goods or services. Yet that’s often the case with self-billing for life, AD&D, and disability coverages.

Why? Because employee eligibility data for these types of coverages often lives in disconnected systems, such as payroll solutions, HCM platforms, or even spreadsheets. So insurance carriers must rely on their customer or a broker to sift through the data and generate monthly bills.

As a result, self-billing frequently leads to friction for customers and carriers:

• Late payments and inaccurate bills

• Overly expensive administrative burden

• A highly manual process for customers

• Estimated $1.4B in loss for carriers annually

That’s not a great experience for anyone, which is why Noyo’s Automated Billing solution exists. Using clean, structured data and automated workflows, we simplify the billing process to help carriers reduce errors and generate accurate bills with less work. The result is a first-class customer experience and recaptured revenue. Here’s how it works.

What is self-billing and why is it used?

Originally created as a way to make things simpler for the customer, self-billing is an invoicing method where the customer calculates and pays their own bill. It’s only used for coverages where full employee eligibility is not required, like disability and life. Since group administrators typically have the most up-to-date information, they’re usually best positioned to create the bill.

To create a self-bill, a customer must access at least two systems of record. While there is no standard process, a workflow might include: 

• HR administrator processes elections to the ben-admin

• Ben-admin submits files to the carrier and census to the broker

• Billing worksheet is returned to the broker

• Bill is returned to the administrator

• Payment is processed

publishedSelf-billing: Old way

With so much room for error, late payments and underpaid invoices are a  common occurrence. And since billing teams don’t know who is enrolled in what, many carriers find it easier to just audit bills when they suspect a premium leakage of 10% or more — the rest is written off as a cost of doing business.

Fixing self-billing with better data

At the heart of these self-billing challenges is data — how it’s stored, how it moves between partners, how it’s cleaned for use. Yet current self-billing solutions do nothing to address data quality issues, instead perpetuating the cycle of inaccurate bills and poor customer experiences.

So how is self-billing managed today? Typically, we see three approaches:

• Manual data entry or file submissions. The most popular and error-prone approach. HR teams usually use files because it is so difficult to get funding to integrate existing solutions. Plus, if a team is already in place and bills are being generated on time, very few decision makers have the appetite for investing in new solutions.

• Purpose-built billing solutions. These third-party services allow employers to outsource the bill production process. Vendors typically use a file extract from the system of record, compare it to a census file from the carrier, and then get back to the employer regarding what that self-bill should look like. But it’s still slow and unreliable.

• Direct connections with ben-admin or HCM. While it’s no secret that HR systems can be disconnected, even when data is pulled directly from a ben-admin system, it’s still expensive to digest it into bills — thanks to factors such as a lack of standard formatting, custom fields that are difficult to navigate, a high rate of input errors, etc.

Enter the Noyo platform for self-billing

Only Noyo ingests structured enrollment data directly from the ben-admin and tracks enrollments over time as member changes occur. Our API-powered platform cleans and validates the data, automatically calculating premiums so your customers don’t have to.

publishedNew way for self-billing with Noyo

How Noyo’s Automated Billing solution works

Available for all lines of coverage and self-billed plans, our solution leverages Noyo’s seamless integrations with ben-admin, HCM, and HCIS software platforms to generate accurate bills. Because we have direct access to enrollment data — the source of truth — we’re able to bypass customer involvement and help carriers offer a list-bill experience for self-billed plans.

publishedHow Noyo's Automated Billing Solution Works

Here’s how Automated Billing works across the billing process with Noyo:

• Step 1. The Noyo platform automatically retrieves and validates billing data from the ben-admin platform using business rules provided by the carrier.

• Step 2. The Noyo platform uses this structured data to calculate the invoice, processing any errors and making any retroactive adjustments, before generating the bill in the preferred format.

• Step 3. The carrier sends the accurate bill to the customer, who remits it with payment when it’s due. Removing friction from the invoicing process encourages timely payments.

Removing manual work for customers and billing teams lets carriers provide a better experience. And it drastically increases accuracy, helping recapture premium lost to incomplete record-keeping or unaccounted-for retroactive changes.

Real-world example: Preventing overpayments with automation

When members of a group hit an event that should have changed their premium to a lower amount, the broker did not update this new information until months after — which meant that those members were overpaying by several thousand dollars. The Noyo platform caught this and our team flagged it with the carrier, making it possible to adjust the group’s bill retroactively.

Seamless billing starts with Noyo

Ready to delight customers with a streamlined experience and recapture premium dollars with more accurate billing? Learn how Noyo can help from Solutions Architect, Daryl Hemeon, and Solutions Engineer, Chris Kaiser, in our on-demand webinar below.