How Technology Can Take the Pain out of Implementing New Ancillary Products

Legacy technology systems are often a hindrance to carriers who are ready to onboard a new ancillary insurance partner–usually the only options are to “the same old same old,” which is time and labor intensive, or use a mix of platforms that aren’t able to work together.

With the increase in account and member demand for ancillary products, the role of technology in delivering seamless benefits programs has never been more critical. Luckily there are some approaches you can take to make both implementation and ongoing management much more efficient on the back end, while providing a much smoother account and member experience.

This post lays out the content of our most recent webinar How Technology Can Make Implementing New Ancillary Products Easy. We were joined by Peter Gaillard, CEO & Founder of Silver Eel Technology, who demonstrated his comprehensive platform.

The Importance of Technology in Implementing New Ancillary Products

The IT Lag & Key Causes in Health Plans
The “IT lag” in health insurance refers to the industry’s struggle to keep up with technological advancements, leading to inefficiencies, outdated systems, and delays in processing claims, underwriting, and customer service.

Here are some of the main causes:

1. Legacy systems: Many plans rely on outdated mainframe systems that are difficult to upgrade and integrate with modern solutions.
   
2. Regulatory complexity: Frequent changes in healthcare regulations make it challenging to implement new IT solutions quickly. Regulatory complexities can also differ between core benefits and ancillary benefits.
   
3. Data Silos: Lack of interoperability between systems results in fragmented data. People and organizational silos can exist, too.
   
4. Cybersecurity concerns: Due to sensitive patient data, companies may be reluctant to bring on a third party, and adopt cloud-based or AI-driven solutions.
   
5. Slow digital transformation: Unlike fintech and other industries, health insurance has been slower to adopt AI, automation, and blockchain technology.
   
6. Cost constraints: Implementing new IT infrastructure can be expensive, especially if organizations are already trying to keep costs down, which results in delaying or restricting modernization efforts.
   

This lag can have significant consequences, including increased costs, poor account and member experience, and regulatory compliance challenges–and, needless to say, it can be difficult for an organization to bring on new products in this environment. 

Now let’s talk specifically about the specific IT challenges that can come with rolling out new ancillary products.

IT Transformation Challenges That Impact an Ancillary Cross-Selling Strategy

1. Legacy System Integration
   Many health plans operate on decades-old systems that are deeply embedded in their workflows. Upgrading or replacing these systems is difficult because
   • They contain vast amounts of historical data.
   • They are interconnected with other critical business functions.
   • Migration poses risks of data loss or operational disruption.
     
2. Compliance with Regulatory Requirements
   When wanting to share claims data, plans must comply with strict regulations like HIPAA (Health Insurance Portability and Accountability Act) in the U.S. or GDPR in Europe. Changes in laws require constant IT system updates to ensure:
   • Data privacy and cyber security
   • Accurate processing of claims and policies
   • Interoperability with healthcare providers
     
3. Data Silos and Lack of Interoperability
   Different departments–claims, underwriting, customer service–often use separate systems, making it difficult to share data efficiently, resulting in:
   • Slow claims processing
   • Inconsistent customer experiences
   • Increased operational costs
     
4. Cybersecurity Risks
   The sensitive nature of health insurance data makes it a prime target for cyberattacks. Key risks include:
   • Ransomware and data breaches
   • Insider threats and data leaks
   • Lack of real-time security monitoring.
     
5. Adoption of AI and Automation
   While AI can enhance fraud detection, claims automation, and customer support, there’s often resistance due to:
   • Job displacement concerns
   • Uncertainty around AI-driven decision-making
   • High initial investment costs
     
6. Customer Experience Challenges
   Many plans struggle with outdated, slow, and frustrating customer service experiences due to:
   • Long claim processing times
   • Lack of self-service options
   • Poor omnichannel communication (call centers, chatbots, and apps)
     
7. Cost Constraints
   Modernizing IT infrastructure requires significant investment in:
   • Cloud computing and AI technologies
   • Employee training and change management
   • Ongoing system maintenance and cybersecurity

Despite these challenges, many of which are deeply ingrained in organizations, some plans are leveraging new technologies, outlined below, to improve the roll out of ancillary products, making systems more efficient internally and improving the experience externally.

MACH Architecture: The Future of Scalable Digital Solutions

MACH stands for Microservices, API-first, Cloud-native, and Headless, and represents a modern approach to software architecture that enhances flexibility, scalability, and speed in digital ecosystems. It’s widely used in industries like health insurance, e-commerce, finance, and enterprise applications to enable agile, modular, and scalable digital experiences.

Let’s break down what each component of the acronym means and how the feature can benefit health plans:

Microservices means that the software is built as a collection of small, independent services, instead of one comprehensive system. Each service performs a specific function, e.g., claims processing, fraud detection, policy management, and they communicate with each other via APIs (Application Programming Interfaces).

The benefits include:

• Faster updates & easier maintenance
• Scalability—individual services can be scaled independently
• Reduces the risk of system-wide failures

Example: A plan can separate claims processing, customer service, and fraud detection into different microservices.

API-First Approach means that every component communicates through well-defined APIs, ensuring seamless integration with third-party services, apps, and platforms, allowing you to bring in different components as needed.

The benefits include:

• Interoperability with external systems like hospitals, government databases, and payment providers
• Faster digital transformation by integrating new technologies easily
• A smooth omnichannel experience (web, mobile, chatbots, voice assistants)

Example: A plan can integrate a fitness app API to offer personalized premiums based on real-time health data.

Cloud-Native Architecture means that it’s designed and hosted in the cloud (AWS, Azure, Google Cloud), so you don’t need to worry about storage space. It uses containerized applications (Docker, Kubernetes) for scalability and enables automatic updates, backups, and security patches.

The benefits include:

• Elastic scalability—handles high traffic without performance issues
• Reduction in infrastructure costs by paying only for what’s used
• Security and compliance enhancements with built-in encryption and monitoring

Example: A cloud-native claims system can automatically scale during high claim submission periods, e.g., a pandemic or natural disaster.

Headless Architecture means that the front-end (UI/UX) is decoupled from the back-end–the front-end (website, mobile app, chatbot) fetches data via APIs instead of being tied to a monolithic back-end.

The benefits include:

• Enables personalized customer experiences across devices.
• Faster innovation—new front-ends can be developed without changing the back-end.
• Future-proof—adapts easily to emerging technologies (VR, AR, voice assistants).

Example: A plan can deliver a seamless experience across web, mobile, and chatbot interfaces without backend changes.

For more background on MACH, I recommend reading the whitepaper, “The Importance of Carrier Admin Technology,” a joint venture between EIS and Voluntary Advantage. 

We invited Peter Gaillard, CEO & Founder of Silver Eel Technology, to give an overview of his comprehensive platform, which acts as a full-service membership partner.

How Silver Eel Technology is Eliminated Technology Challenges

Silver Eel specializes in technology solutions in the Life and A&H space, and ancillary products, in particular. We asked Peter how his platform eliminates the existing technology challenges that health plans traditionally have faced when starting to cross-sell ancillary products:

Rich: Can you describe the options that plans have for bringing an ancillary product to market, from a technical perspective?
Peter: The first is, well, to just build it yourselves–you’ve discussed some of the hurdles that go along with that, such as dealing with internal IT folks. The second option is to go out and say, ‘You know what, I’m going to contract with a number of different vendors, one for the policy management system, one for a billing system, and one for the e-commerce system, and I’ll stitch all those together. The third option, which is the one that we advocate for, is you can engage a single vendor that has all of the capabilities to allow you to bring your product to market.

Rich: How do you sum up what Silver Eel does?
Peter: Our mission is really to help our clients bring their products to market digitally, compliantly, and efficiently.

Rich: How does it work?
Peter: We use a cloud-based platform like you described–we built our platform using MACH and APIs. When we started this five years ago, we were really starting with a clean piece of paper. We were able to do exactly what we wanted to do. We’re not limited by any legacy systems, so we really have created our platform in a very modern way.

Rich: What sets you apart?
Peter: The platform is really a comprehensive platform, and its “insurance first.” This was not a platform that was built and then retooled to support insurance–the platform includes everything from onboarding of an agent to sell your product, to how that agent submits business. It has an underwriting workflow, a policy management system, an e-commerce ability for groups, and an enrollment platform that takes care of premium management commissions.