New Zealand business Konnect Net has created a system that’s transformed health-insurance information exchange and has other far-reaching applications.
The processing of health-insurance applications can be long and arduous for everyone involved.
That all changed, though, when Konnect Net—a New Zealand company established in 2008 by Hamish McLachlan, Murray Lilley and Peter Gardner—launched its new product, SureMed.
The aim, explains McLachlan, was to revolutionise the exchange and management of information across the insurance and health sectors. Konnect Net would achieve this by developing and deploying smart, secure business-process management solutions.
“Our initial focus was on delivering the SureMed service, which was fully deployed in April 2010,” says McLachlan. “SureMed has successfully solved a longstanding problem that’s plagued the insurance industry and the private health sector.”
To provide insurance cover to individuals, insurers often need information from various health professionals. This traditionally paper-based process, dealing with non-standard documents, was slow and expensive; not to mention time-consuming for GPs who’d rather be helping their patients.
The first solution of its kind in the world, SureMed lets doctors receive and respond to insurance medical-information requests electronically. Cutting out the paper shuffling, says McLachlan, has reduced the application process from 20 days to just eight.
“It’s standardised, fast, secure and reduces admin so doctors can focus on healthcare. Insurers and advisers get a faster turnaround on applications with reduced administrative costs.”
SureMed is now used by most major insurers and general medical practices in New Zealand. Konnect Net consulted extensively with GPs and worked with the health sector to ensure the system would be effective.
“SureMed is a great platform to grow from,” says McLachlan. “In just one year, we have 75 percent of the market volume. We started looking at other markets early last year and we’ve piloted a system in Australia that will be in full production by July 2011. We’re starting to become visible now and have had calls from Canada and the US.”
It’s been an interesting and challenging time for Konnect Net, and the company has grown extremely fast. McLachlan credits its success to great staff and its partnerships with advisors such as accounting firm Hayes Knight.
He says Hayes Knight has been more than simply an accounting-compliance provider, and instead has played a key role in Konnect Net’s development and growth.
“Hayes Knight has been a key partner since early on,” says McLachlan. “They’ve played a critical role in our success by providing access to expert audit and tax advice and support. They’re very driven to help new businesses grow and are open and easy to deal with; plus, they asked the right questions about our company. They got what we were trying to do, and have been much more than a traditional accounting firm.”
Hayes Knight business improvement director Aaron Wallace says Konnect Net has used many of the firm’s specialist service lines.
“We’re impressed that Konnect has always sought our advice before launching into anything,” he says. “It’s refreshing not to have to ‘undo’ a structure or deal that wasn’t planned properly at the outset, and where the best model or pathway wasn’t chosen at the time.
“By offering technology to solve age-old problems, Konnect Net has created operational efficiencies for its customers. The company has really grasped what factors are needed to trade in tomorrow’s business landscape. We’re proud to be associated with such a forward-thinking company.”
Hayes Knight has also offered assistance with shareholder structuring for optimal return (including offshore investments), carried out quarterly audits on company processes, and helped ensure the all-important structures are in place as the company grows.
“As an independent service provider, transparency is vital for us,” says McLachlan. “Hayes Knight has been a big help in this area. And, as our business has become more complex, they’ve provided advice around growth opportunities and directly supported our Australian expansion.”
Colin Henderson, Hayes Knight audit director, has worked with Konnect to create best-practice systems for its financial recording and helped with good governance practice.
“Konnect’s appetite for good governance has ensured a credible financial position and a strong base for growth,” he says. “From this, the company will continue to raise further capital from the early equity raising.”
Hayes Knight’s Audit team also ensured appropriate procedures were in place to safeguard the funds flow from insurers through the SureMed trust account to the medical practices.
“It’s nice to be able to add value to the health sector—even in a small way,” says McLachlan. But the beauty of Konnect’s technology is that it isn’t just limited to the health sector. The model can be applied to any sector where information needs to be collected from multiple parties.
Konnect Net is a service provider offering business processing solutions, explains McLachlan. “Software is one component of what we do, but it’s also about the business processes and getting the right workflow that adds the value. Technology is always replicable, but a good business and service model is vitally important.”
2008—Konnect Net founded by McLachlan, Lilley and Gardner
2010—SureMed service launched
Late 2011—new Konnect Net product SureApp goes live
12 days—the amount of time saved in the application process by making medical information requests electronic
Most major insurers and general medical practices in New Zealand use SureMed
Expert audit and tax advice and support provided by Hayes Knight