David Goehrke:
Hello and welcome to this quarter's Electronic Health Record Podcast from Munich Re. I'm your host, Dave Goehrke, Second Vice President of Underwriting here at Munich Re. In our last episode, we spoke with two executives, Tim Morant, Chief Risk Assessment Officer at Munich Re, and David Doran, CEO of Electronic Health Record Provider Clareto, which is a Munich Re company.

Today, we're going to share some statistics on who's using electronic health records and dive deeper into three specific use cases: post-issue audit, accelerated underwriting light touch, and even point of sale or triage. My colleagues Katy Herzog, Assistant Vice President of accelerated Underwriting, and Jennifer Dalton, Underwriting Director of Accelerated Underwriting, are joining me today. Thanks for joining me, Katy and Jen. Welcome.

Katy Herzog:
Thanks, Dave. Happy to be here.

Jennifer Dalton:
Thanks, Dave. Thanks for having me.

David Goehrke:
Jen and Katy, we've got all underwriters in this episode, which is great. With the development of electronic health records happening at such a rapid pace, we've got a lot to talk about. First, Katy and Jen, let's spend a moment on the current state of life insurance underwriting. What are the big issues that underwriting departments are facing, and where do EHRs fit in? Let's start with you, Katy.

Katy Herzog:
Thanks, Dave. So, like most industries, we're in the midst of a huge digital transformation, and really, the key focus is on speed, gathering the data, assessing the data, and making decisions, all while doing that without sacrificing mortality. So we all know we're underwriters can take up to one month or more to gather the data, but digital health records like EHRs, they really have the potential to replace the time-consuming methods of obtaining applicant health information.

They provide quicker access to patient records with longitudinal data. So it's not just a point in time, but it's over time, we get multiple readings. And many people are seeing EHRs as a replacement for APSs, but they can be used for alternative uses like parameds and labs. You can replace those. They can also increase the accuracy of risk, and again, like I mentioned, speed is key. And then the third, maybe the most important is the customer experience. You can provide them a quicker experience and a less invasive experience.

David Goehrke:
So what are the advantages of using EHRs in underwriting, Jen?

Jennifer Dalton:
So there are many advantages to using EHR, and as Katy mentioned, speed is one of those factors, but accuracy and cost are also front of mind as our carriers are evaluating the underwriting process. As an underwriter, we've all been asked to approve an excessive APS fee. We've had to modify that request in some way to make it work. But with EHR, a single request can return multiple facilities, which makes them far more comprehensive than a single APS.

And EHRs may be cheaper than APSs, which can be upwards of a hundred dollars or more per facility, and EHRs are often much faster than APS and without the additional administrative follow-up. Based on our experience with several carriers during our pilot, most documents are returned within one day. There are also fewer special authorization challenges, as we are seeing that fewer than 5% of EHR searches require a special authorization. Another noteworthy advantage is how EHR results are delivered. Because EHR contains some structured data, that data is available for use in algorithms and rules engines. It can be machine-read, unlike an APS, which is often a static document that is difficult to integrate with our rules and models.

David Goehrke:
Thanks, Jen. Where does the US life insurance industry stand right now with the adoption of electronic health records?

Jennifer Dalton:
Yeah, the vast majority of carriers are looking at EHRs as an APS replacement or for claims adjudication. According to our latest Munich Re Life US Underwriting Survey, we saw that EHR had the steepest adoption, up 38% among all digital health data options compared to our 2020 survey results. We also found that over 90% of our carriers surveyed were using or evaluating EHRs for their accelerated underwriting programs. Interestingly enough, the survey showed that EHRs are used in both traditional and accelerated programs. Currently, underwriters review the EHRs manually, but most carriers are looking to integrate with the rules engines in the future.

Katy Herzog:
And I'd add on that point, Dave, that the path of EHR adoption is looking very similar to the evolution of digital prescription data approximately five years ago. When digital prescription data first came on board, carriers were learning how to use it and where it could provide the most value. But now we've reached a tipping point and now, everyone based on our survey uses digital prescription data.

David Goehrke:
Good. I want to spend more time on this non-traditional use of electronic health records and, specifically, what we've learned through the work we're doing right now at Munich with Clareto. Katy, how are we using EHRs for, let's say, for example, post-issue audit?

Katy Herzog:
Yeah, so we're seeing carriers use post-issue EHRs in a lot of ways, and it makes sense, right? It's really the path of least resistance to let them gain experience with a lower risk. So we're seeing them replacing post-issue APS’ and random holdouts with EHRs. And the reason that we're seeing this is based on the increase of accelerated or automated decisions, they need to make sure that the decisions that they're making are accurate. And so, in order to test those assumptions, they're looking at electronic health records on the post-issue side.

David Goehrke:
You could imagine using a traditional APS to do that would be hugely resource intensive. Electronic health records can be hugely resource-intensive, too. I've seen some of those PDFs, they're awful. But ideally, if we can extract data like you guys are talking about, maybe we can make that much simpler, right?

Katy Herzog:
Yeah, Dave, that's a good point. I think today, and the earlier you are in the process, the review time of EHRs is very similar to that of APSs. But as you gain experience and start to use the structured data that's there, you can vastly improve the review time.

David Goehrke:
In terms of just the process overall. Jen, can you explain how EHRs are being used?

Jennifer Dalton:
Absolutely. So we've already talked about using EHR as an APS replacement. We know that if we order a medical record, it may take a month or more to get those results back. And using the EHR, we can speed up the underwriter review to just a few days. Now, we know that's not an instant decision yet, but it is much faster than where we were. The second path, and we've referred to this as well, is light touch accelerated underwriting.

Light touch cases are those that are kicked out of acceleration or automation, but we still have an opportunity to extend an underwriting decision on these without fluids. So instead of automatically sending them to be kicked out for labs in a paramed, some carriers are actually ordering EHR to aid in the risk assessment. There are many times that an underwriter is on the fence, right, about ordering medical records?

What do we know about this applicant? What doctors are we going to order from? And do we even know when this happened? Or are we just going back and trying to find it? So underwriters have to weigh all of those factors along with their internal underwriting guidelines when determining when and where to order records. An EHR may allow underwriters to obtain a more complete medical history with less requirements, less touches, and faster approval times. So all in all, using EHR for light touch underwriting gives us a faster, smoother customer experience versus our fully underwritten process.

David Goehrke:
Yeah, I don't know about you, but I still think of the traditional APS as the gold standard and, in terms of what you would want in for risk selection, EHRs have been a great replacement for that much faster. But when we think about digital health data, so we think about RX, we think about DX, we think about clinical lab data, and we think about EHR now, and EHR potentially, has all those other things included if it's a good record.

But as you've both stated, we're not quite there yet in terms of the speed and efficiency of processing that type of data. And you think of instant decisioning when you think of those other tools, you don't necessarily think of that when you think of electronic health records. So Katy, where are we with actually instant decisioning with electronic health record data?

Katy Herzog:
Yeah, I wish we were further along. As Jen mentioned, they still involve human review. Most EHRs, almost everyone we surveyed still has a human review the electronic health records results, but it's not all bad news. On our survey, we did find that a lot of carriers are really thinking about integrating that data now with their rules engines and into their models. Here at Munich Re, we are really focusing on that digital data and we're developing a product that will enable easier, more efficient use of EHRs.

We see initial opportunities we've mentioned before, a couple of those post issue audits, and then Jen mentioned AUW light touch. But eventually we see the ability to use EHRs for AUW point of sale. EHRs contain underwriting-relevant information that is readily extractable. As you mentioned, Dave, vitals spilled, blood pressure. That's data we don't get today in accelerated underwriting. So in an accelerated environment, EHRs could help eliminate the bad risks that may be flowing through these today.

In addition, we could see an increase in the number of good risks that can be quickly processed with the additional information provided in EHRs.

David Goehrke:
Great. So we know usage is growing on the carrier side and they're using sometimes slightly different ways, but still kind of like the old-fashioned way, but the advancements are being made and it certainly sounds like electronic health records are on their way to becoming more commonplace in life underwriting. Katy, you made a great example of where RX was years ago, but we're still in this transition phase. What will it take to spur further adoption?

Katy Herzog:
So we asked our carriers what their top three challenges were with EHRs, and, in this order, they came back with higher hit rates and then more complete data and finally, easier use. So these capabilities are ones that Munich Re and Clareto are actively working on. Clareto is continually building out their data network, which should improve hit rates and data completeness. They're also enhancing capabilities around ordering and delivering EHRs, including smart retrieval and a physician lookup service.

Here at Munich Re, we're committed to building out solutions that will make EHRs easier to use in underwriting. So we've grown our team of data science, engineering, underwriting experts to create these solutions. We're building and testing and we have this large pilot study that we're conducting in which we're actively developing tools to extract, summarize, and present underwriting-relevant information for underwriters to use to assess a case.

It's a tool designed by underwriters for underwriters, so we're really excited about it, Dave. We're also working on applying proprietary mortality models to more accurately assess risk for decisioning purposes.

David Goehrke:
I know the results of our large pilot study have been extremely promising, so much so that it's the topic of our next podcast. At that podcast, we're going to talk about how we at Munich have structured the pilot and share key takeaways, including data on hit rates. Again, some are very, very surprising -- also turnaround times and the ability to detect misrepresentation.

If you want to learn more and can't wait until our next podcast, feel free to reach out to any of us. We'd be happy to talk about the best way to test and expand the use of EHRs in your own programs. I want to give a special thanks to both of you, Katy and Jen. Thank you very much for joining me today.

Katy Herzog:
Thanks, Dave. Really exciting. We really are on the cusp of realizing the full value of EHR.

Jennifer Dalton:
Thanks, Dave. I appreciate the opportunity.

David Goehrke:
Again, thanks to both of you and thanks everyone for listening to our podcast and we hope you join us next time.