Neighborhood Health Plan is touting what it describes as a unique strategy to continue growing its commercial line of business in Massachusetts’ highly competitive marketplace. The plan is proactively offering money-back guarantees on prompt, efficient customer service to new large- and mid-sized employer-customers signing up groups for coverage. But one consultant questions whether the metrics chosen will resonate with employers.

Large employers of 500-plus workers could get up to $50,000 annually, while mid-sized employers of 100 to 500 workers could get up to $20,000 annually, under NHP’s new performance-guarantee program announced April 13.

Boston-based NHP, which is trying to make a strong play into the commercial market and away from significant losses incurred as Massachusetts’ largest Medicaid insurer, says it is the first health insurer in the U.S. to take this particular approach.

“We’ve grown over 55% [in membership] in the large group market in the last three years,” says Katie Catlender, not-for-profit NHP’s chief commercial officer. “We want to grow more aggressively and leverage this [customer-service performance-guarantee program] to show our commitment to superior customer service.”

“We have a tremendous number of accounts in the pipeline…and we do believe this [new strategy] will enhance our large group growth,” she says.

Under its money-back guarantee program, NHP says it will deliver on seven specific customer service measures for new employers (see table, below). These include continuing to answer 80% of customer calls within 30 seconds, resolve nearly 90% of member issues during the first call, and accurately process 90% of claims within 10 business days and 99% of claims within 22 days.

“I certainly think it will help distinguish us as well as help us grow,” Catlender says of the program. “It’s unique in the market and unique nationwide.”

Joe Paduda, principal with Skaneateles, N.Y.-based consulting firm Health Strategy Associates, says that as a health plan “with its roots in Medicaid managed care, NHP may be doing this to address a somewhat negative image in the employer population. Unfortunately, health plans that primarily serve lower income populations may be perceived as somehow ill-suited for employers.”

“That said, I’m not sure that these metrics are the right ones,” Paduda adds. “Customer satisfaction scores based on overall service would be more reflective of employee perceptions and in the long run help NHP identify and address any employer concerns.”

NHP’s managed Medicaid enrollment grew by more than 80% from 2012 to 2016, according to AIS Health’s Medicare and Medicaid Market Data, published annually. Overall, the 30-year-old plan covers 430,000-plus commercial and MassHealth (Medicaid) members.

However, NHP has been pulling back from its Medicaid line of business for months, freezing enrollment in October 2016, then announcing in early April its intent to slash its MassHealth business in half, according to the Boston Business Journal. NHP, nearly seven in 10 of whose members are covered by Medicaid, posted a $17 million operating loss in its fiscal quarter ended Dec. 31, up from a $1 million loss a year earlier, the Journal reported.

NHP was acquired in 2012 by Partners HealthCare, which had a $108 million operating loss for the fiscal year ended Sept. 30, 2016 — its largest ever and nearly all of it driven by Neighborhood, the Boston Globe reported.

According to the company, its dedication to the MassHealth program remains strong. NHP says it intends to apply for partnerships with some providers in accountable care organizations (ACOs), reflecting the state’s new direction for Medicaid that NHP supports. NHP also applied for the state’s Managed Care Organization (MCO) Reprocurement to serve MassHealth members whose providers aren’t part of ACOs.

NHP says it hopes to expand its MassHealth presence again when the MassHealth market stabilizes.

But for now, Catlender says, “We’re investing heavily in our commercial line of business and really growing [it].” Currently, employer groups comprise 66% and individual members account for 34% of NHP’s commercial segment, the company says.

Catlender, contacted several days after NHP announced the program’s launch, told AIS Health the plan has “heard great enthusiasm” from employers and brokers alike about the performance guarantees.

As NHP considered how to promote itself to potential employer groups as a value proposition, it settled on its customer service experience, Catlender says. “We want to differentiate, and we believe the service excellence we provide is not matched by others,” she says.

The program aims to reinforce NHP’s commitment to customer service that — along with a robust provider network and low administrative costs translating into premium savings — is helping to create strong brand loyalty among members, Catlender says. NHP has a 95% account retention rate, she notes.

NHP will report on its performance against the seven guaranteed measures annually, paying any refunds upon the employer’s annual group renewal, she says. Each measure has a corresponding dollar amount payable to the employer if that particular mark is missed, she adds.

“We’ll pay out on an annual basis, but we’re tracking it daily and monthly…and will report to employers as regularly as they like,” she says.

NHP already provides diverse customer-service staffing that reflects the community, “which has positioned us well in the market,” Catlender says. The plan reaches out to new members proactively by email or phone call, with information in English and/or Spanish, within 24 hours of enrollment; promotes efficient staffing levels; and prioritizes customer service within the organization by providing tools and financial bonuses to improve performance, she adds.

See Neighborhood’s press release at

Neighborhood Health Plan’s Performance Guarantee Program

Service Measure

Performance Guarantee

Customer Service

Call response/telephone service factor

80% of calls answered within 30 seconds

Customer service/call abandonment rate

Less than 3% of calls abandoned

First Call Resolution

88% resolved in the first call

Claims Processing

Turnaround time

90% within 10 business days and 99% within 22 business days

Claims processing financial accuracy

99% of all dollars are paid accurately

Claims processing payment accuracy

97% of all claims are paid correctly

Claims processing procedural accuracy

95% of all claims processed (payment and non-payment) are processed correctly

SOURCE: Neighborhood Health Plan. Visit