Back when I was working in-house as a regional managing attorney in the company’s staff counsel program, I was tasked by the company’s general counsel to work on a special project. The project was to fix the company’s legal bill review program and to look for another legal e-billing vendor.
The reason for the second part of the assignment was that the company’s e-billing vendor had become slow or not responsive at all to many technical problems the company had been having with the vendor’s legal e-billing program.
As my company was passing $150 Million in outside law firm billing through the vendor’s e-billing system, I was truly puzzled by the lack of vendor’s response to our needs. Surely we were a big customer of the e-billing vendor and all vendors take care of their big customers, right? Well, yes and no. Yes, vendors do take care of their big customers and no, we were not a big customer – even at $150 Million in annual legal spend.
The above points were driven home to me at the vendor’s annual users’ conference by another insurance company representative at the conference. He told me that he had observed that the vendor’s technical support team was mainly focused on their larger customers – those that had over $500 Million in outside legal expense.
What I learned over 10 years ago unfortunately is still true today. It is especially true for those insurers who have less than $20 Million in outside legal spend. I recently consulted with one small insurer (less than $5 Million in outside legal spend) that decided to drop the company’s legal e-billing program.
The chief reasons the insurer had decided to drop the program were that as a smaller insurer they had no staff time to effectively deal with the myriad of vendor reports and the vendor’s lack of timely response to technical problems they and their outside law firms were having. Before I could relay to him my own experience 10 years earlier on his last point, the company’s vice president of claims said that he had figured it out – the e-billing vendor’s technical resources were being directed to their bigger customers. As he relayed it, it was like they were a very small fish trying to swim in a very big pond.
As I have written in previous blog posts, I am a supporter of e-billing programs – especially for very large insurers. However, as I stated in Why E-Billing Systems May Not Work for Everyone, e-billing programs may not really work for smaller insurers unless, of course, you just like being a very small fish in a very big pond.