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Payment Delays--Looks like we could improve cycle time

I just had a meeting with my TPA's National Account Manager and was reviewing cycle time on invoices.

Cycle time is important to me as it is to you. [I feel that if I offer good cycle time--that my payment structure might be more acceptable.]

My report indicated days from your installation to the day your billing was received averages 11.26 days! [seems kinda long to me]

The days from receipt of your invoice to my payment is 13.43 days! [seems too long to me as well]

I will work to improve cycle time from 13.43 days, trying to get it under 10 days.

When I add these two numbers together, it appears the current system takes almost 25 days! [way too long IMHO]

Were you aware of this delayed billing? Perhaps we could both work towards improving cycle time?

Who is the best payer? Perhaps I could learn something from their operations?

Re: Payment Delays--Looks like we could improve cycle time

When we EDI American Family thru SGC, we are paid within 2 weeks. Lynx is usually 20-25 days.

Re: Payment Delays--Looks like we could improve cycle time

This is my last reply on this board.Moving on.Hal,the t.p.a's have extended credit to you,therefore you should be able to take 30 days to pay.The t.p.a's should pay the glass shops upon receipt of bill.

Re: Payment Delays--Looks like we could improve cycle time

Wow, I can't believe it takes glass shops 11+ days to invoice SGC. If that is accurate, there is something very easy to improve.

But, Hal, I suggest you ask SGC a couple of questions about that number. I wonder if that is an average 11 days before SGC accepts a "correct" invoice. I say this because we experience a high number of rejected EDI invoices from them, when in fact there is nothing wrong. Many of our invoices gets accepted on the second submission when we merely resend them without any changes. Of course, this means we have to continuously monitor them to see what invoices have been rejected, which adds a week on to the cycle time.

Re: Payment Delays--Looks like we could improve cycle time

Hal, Here is cycle time from a glass provider perspective

...days from your installation to the day your billing was received averages 11.26 days!

Most glass companies utilize EDI in one form or another and can invoice the TPA the same day the work is done. I know that State Auto has electronic connectivity with SGC so you should see a clean invoice in as little as 2 days.



The days from receipt of your invoice to my payment is 13.43 days!

Again, if you have connectivity with SGC, this should turnaround in 3-4 days tops.

...cycle time from 13.43 days, trying to get it under 10 days.

Cycle time could reasonably be 5 to 10 days with EDI.
Don't forget about EFT improving the process by a ton as well.

...current system takes almost 25 days! This is worse that the old days of paper only.

For grins, what was the cycle time for work done in a Safelite shop?

Thanks

Re: Payment Delays--Looks like we could improve cycle time

TO answer your question about who is cycle time. For us it is State Farm. We will usually have payment in our bank between 8 and 16 days. We EDI and receive EFT.
We receive the job assignment electronically from Lynx approve it creating an order from THEIR information and then our POS system audits our invoice against the information LYNX sent through before we finalize it for billing. rejected invoices are a thing of the past. Maybe 1 out of a 100 WORST CASE.

With this system the amount of user entry on our part is minimal(VIN, Mileage, etc).

Re: Payment Delays--Looks like we could improve cycle time

What % of the jobs that are done are even done by providers other than safelite? I mean come on, I cant imagine this is a big issue worth raising an eyebrow at when 75% or more of the work is done my the managers of the glass programs themselves Have they made this an issue?
No offense, I just would like to see the #'s since we have to agree to every single program dictated price where these jobs are going. I could go 30 off no prob if you sent me 15 jobs a week . No wonders there.

Re: Payment Delays--Looks like we could improve cycle time

TSi I believe HAL has stated the Safelite only does around 20% of his glass claims thru their shops. You might check the threads for his details.

Re: Payment Delays--Looks like we could improve cycle time

LOL

Re: Payment Delays--Looks like we could improve cycle time

Hal-

Why do you call it YOUR PAYMENT STRUCTURE ?You just love toying with this forum!

Re: Payment Delays--Looks like we could improve cycle time

Hal-

Maybe 11 days of the 11.6 time delay is the bill laying on someone's desk and being ignored to delay paying an independent in a timely manner. Do you really believe glass shops are waiting 11.6 days to send an invoice.

For a little double check, go pull invoices that were billed on your behalf to Safelite and see what day the work was done and then check the date on the fax or EDI and do your own calculations.

Why would a glass shop wait to send a bill, when margins are so tight?

If a glass shops faxes the invoice to Safelite on the same day the work is completed, the shop should receive the payment in 10 days....LOL

Do you really think we are that stupid to believe numbers you are putting out?

You need to spend a little time at your TPA's office before they move to another country and look at paper work first hand and see some real numbers.

I have ALWAYS billed by fax or EDI same day or next day. Never once have I received a check in 10,12,13,.......or even 25 days

You need a little SHOW ME(Nebraska)attitude before throwing numbers at us that can not possibly be correct!

I THINK YOUR CYCLE TIME NEEDS A LOT MORE ATTENTION,THAN YOU FIRST THOUGHT.

Re: Payment Delays--Looks like we could improve cycle time

Today I got a check.(even though eft was sent to sgc almost a year ago and I tried to see why it has not happenen twice) The check was for a referal of 07/22/2005 sent the same day and rejected maybe 5 times. That is one of 7 I have had the same problem with. Why would they make it easy for me? Anny one with a conflict of interest should not do this and an insurance co. should be able to do it better except for the price fixing, you need a third party to do the nonlegal stuff.

Re: Payment Delays--Looks like we could improve cycle time

RO-

I referrred to it as my payment program for obvious reasons. The numbers reflect my program's time line.
Not sure what else to call it.

I was sharing my observations regarding delayed payments and possible causes. Some issues are out of our control--others are within our control. I was merely suggesting that there might be room for faster cycle times.

Best wishes

Re: Payment Delays--Looks like we could improve cycle time

Hal,
Just for you info. After I submit the invoice to SGC electronically I can look at days from referral to date billed. the numbers they show are inconsistant with mine. In other words 99% of the time I have completed the work with 24 hours of when I receive the first notice of loss from SGC. And submit a bill to them and it shows accepted within the next 24 hours of job completion. Some times it will show 1 or two days, but most show more days than that. Some have even showed more days than what have even been possible.
For example they call me with the job on Monday, I complete it on tuesday, Submit the invoice on Wednesday and it shows accepted. then on Friday it will show 14 days as time from referral to invoiced.
Never have worried about it, but thought it was interesting after reading your post.

I kind of figured that another shop had the referral first then it was reassigned to me for whatever reason(happens alot around here) so that was counted as days to invoice even though I knew nothing of the job for those first days.

Re: Payment Delays--Looks like we could improve cycle time

Here's what we see. We do a job thru sgc, we EDI the invoice same day most all cases very rarely second day. Then we watch it sit in our edi logs "pending authorization" for usually 2 weeks then about 2 weeks after acceptance we see a check. HMMMMM. Also look out we have seen them rascals pull a chip repair repair out of an entirely different invoice from a repair done last year because they thought we were paid twice. NO phone call to ask about it or anything!!!! Just randomly pull it. They took a paid invoice and made it an unpaid. But because of good record keeping and a special thank you to HAL,(thank you Hal), it got straightened out pretty quickly. If I would have taken this straight to sgc I know for a fact I would have gotten NOWHERE! Hal Please believe us when we say sgc uses any and all tactics to use OUR $$$$ anyway they can for as long as they can!

Re: Payment Delays--Looks like we could improve cycle time

HAL- We just checked the last 6 months of our EDI transactions with SGC and the longest delay we had on our end was 4 days from service time to EDI time(this includes the receipt notice that SGC had received the EDI invoice. Most payment checks still took an average of 29 days (some up to 4 months) to be issued (not including mail time of course). We do not do work with your company in our area sadly, but I wanted to give you a general idea how long SGC is taking on average to process other ins. co. invoices.

The ironic thing is, we have spent thousands on CSR training, computers, internet access to process claims with ins. co., follow their processing guidelines, pre-audit our EDI invoices thru verification software, and still SGC rejects about 30% of them. Other TPA's are running about 2 to 5% rejections (based on incorrect or deficient data that is not our error as we do not count our errors in these numbers). The point is we have spent a considerable amount of time and money to work with TPA’s and hopefully decrease cycle times, and despite this we still have the same issue with them, SGC particularly, that we always did.

Hopefully this will help explain some of the frustrations many glass companies have with TPA's in general, and especially SGC. We can all verify that SGC is one of, if not the most, inefficient TPA’s on our end of the business transaction. A TPA that seems to find considerably more excuse in order to delay a payment than their competition does. This is what leads us to determine there is ONLY one reason companies like yours continue to stick up for SGC and use SGC for claims processing, that being THEY SAVE YOU a considerable amount of money.

Sorry you take so much heat on these boards HAL, but I think you know it is just that, frustration, and not directly at you personally in most cases.

Best wishes to you as well, my friend.

Re: Payment Delays--Looks like we could improve cycle time

Our experience has been that Safelite, Lynx & Alliance all wait 21-30 days before payment arrives from submission. Harmon seems to be fastest payer/fewest rejects. Faster pay would help ease pain of discounts though and make record keeping less of a pain!

Re: Payment Delays--Looks like we could improve cycle time

I still think billing the insurance co worked better in the past. Now with fax ect. I get checks frome ins. co. in less than a week when I direct bill, just cut out the middle man.

Re: Payment Delays--Looks like we could improve cycle time

as I understand it, Insurance co's get a kick back from safelite at the end of the yr. Also, Harmon will pay but they will not pay what you invoiced even after you do the 3 way call and bill what they tell you. they always pay 1/2 of what they should. then its a battle to even talk with them. NO GLASS COMPANY SHOULD BE ALLOWED TO ADMIN CLAIMS FOR GLASS and a body shop ABBRA should not beable to claims for the collision end either! I want to call my agent up and tell him, I am going to delay my payment to him and oh by the way it will be 25% less but DONT even think of cancelling my insurance.

Re: Payment Delays--Looks like we could improve cycle time

remember who is writing those reports. any one can make numbers be what they want the other person to see. Hal, go sit in their call center and listen to the calls. Or better yet, try and do a claim and see who they send you and...... then tell them you want a differnt shop. see how they work. I have several friends experience safelite pusshing them into 'their glass shop" (safelite) I have had some call request my shop and was told that we told safelite that WE were too busy and could not get to the.. What a joke. dont understand why you or anyone else would support them. oh I forgot, that helps you get your bonus check at the end of the year.
(sorry, just a little cranky today. spent too much waisted time dealling with trying to get paid.

Re: Payment Delays--Looks like we could improve cycle time

Hal-

You said you were trying make your cycle time QUICKER so ***Your*** PAYMENT STRUCTURE MIGHT BE MORE ACCEPTABLE".

My question is :Why is it ***YOUR*** payment structure and not a payment structure created by the glass shop?

Do you install windshields?
Do you own a glass shop?
Do you pay my bills?
Do you pay my Employees?
Do you answer my phone?

The answer is obvious!

Re: Payment Delays--Looks like we could improve cycle time

RO, I saved this from a string that was pulled. Hal explains.


"Re: SGC & NAGS

Still here-

Remember that Insurers have employed t.p.a.'s to help us manage our accounts. That is their main benefit to an insurer. They are the 'experts'. After reviewing our needs, they offer suggestions.

It is the Insurer's needs that forms their glass program, not the t.p.a.'s dictates. They help us see what works and what might not work for our own operations. We can choose to be more aggressive or passive with our pricing based on our individual company philosophy.

Yes, there are some common denominators in the programs, but these are only a small part of the program. While the t.p.a. makes suggestions as the markets evolve, the insurers set their own prices. For example, I don't think I could ask for the same pricing you might give State Farm since my volume is much lower!

The t.p.a. may help us see the global pricing picture--but we then make our own pricing decisions.
Email: hal.hare@stateauto.com

Re: Payment Delays--Looks like we could improve cycle time

Great post Mark 1.

I love the part that HAL stated he does not expect a larger discount than StateFarm as he is aware his claims are a much lower volume.

So why is ANYONE getting a bigger discount than State Farm? They are by far the largest auto insurer, correct? This is how we set our ins. co. pricing, just like a any fleet account. The more work they send us the bigger discount they get. So when Progressive wants 30% discount and we only do 2 Progressive jobs a year we tell them to find someone else if they do not like our retail price.

Giving one of your smallest customers your biggest discount is just not the business model we want to operate.

Re: Payment Delays--Looks like we could improve cycle time

Mark1 and CCC-

How can the word "SET" be used so openly from a company that collects premiums and pays the claims.Pretty dam bold wording if you ask me!

Re: Payment Delays--Looks like we could improve cycle time

RO,

My point exactly. THat's why I harvested the string before it was pulled.

Re: Payment Delays--Looks like we could improve cycle time

RO-

Of course you may bill whatever you wish.

However, I would hope that your billing would be within the range of what is usual and customary for your market.

Re: Payment Delays--Looks like we could improve cycle time

HAL-

You are still comparing apples to oranges.

You have absolutely no basis to compare the glass work of one shop to another, yet you (ins. industry) expect us to all do work for the same price. You even expect a glass shop to install a DW1341GBY for the same price each and every time, despite the need for any additional work (rust, last installer errors, broken clips) on a future DW1341GBY.

The point is you think a claim is a claim, a part is a part, and have no clear understanding of what is truly involved on every job. This hurts you in reverse as well. There are several NAGS parts that have insane labor times and you get hit with high labor charges on those when it is unnecessary.

From what I hear, you personally HAL, do try to manage your glass claims in as fair a manner as is allowed by your company, and I am sure many glass companies that perform services for you are happy for that fact. I hope you continue to be reasonable, fair, and develop a great relationship with your glass vendors. Most of us are not out to make millions. We do want to do an honest job, make a small living, and perform work we are both proud of and can be respected for.

Re: Payment Delays--Looks like we could improve cycle time

Hal-

You say:

You hire TPA's because they are experts and evaluate your needs and make suggestions.

Why can't you just lower prices every time Nags changes without the help of experts?

Why do you need them to do it for you?

Do you really understand the needs of the Auto glass industry, if you did. We would not be having this conversation......

We tell you the real cycle times of payments and you ignore us as usual, why don't you just give us a gun and tell us to pull the trigger?

How long have you been in the Auto glass business, I mean Insurance business?

Re: Payment Delays--Looks like we could improve cycle time

CCC-
I see the universal billing trends for my operating area. That influences me. If 98% of the shops accept my pricing-I am satisfied I am on the right track. Shops are free to decline. You should be able to make a fair profit--I guess sometimes we are not in agreement about what is 'fair'.

RO-
I only have 31 years experience with insurance claims.
I have never installed a w/s, but once removed one for a VW dune buggy project years ago. This is one of the reasons I rely on my t.p.a. for advise. I rely on them to help with technical questions as well as audits of invoices. They do help me pay what is owed.

Certainly I recognize some advise could be self serving. I listen--and then make my own decisions about my program needs.

We made a business decision to go with a t.p.a. program 12 years ago--and it has worked well for us.

Best wishes

Re: Payment Delays--Looks like we could improve cycle time

Hal, I always tell the tpa's no I dont accecpt the pricing but what choice do I have if I want to get paid. Can not tell you how many times the tpa has laughed and said you are right, what choice do I have if I want to get paid and not have to spend 1/2 a day or more just to get a "normal" person to talk to.

Re: Payment Delays--Looks like we could improve cycle time

I would agree with your thinking HAL. If 98% of your service providers agree to your pricing I would also assume I was on the right track, what other conclusion could you come to? I do not blame you for that line of thinking, I blame glass companies for giving into that fear, and accepting the dictates and deceptive practices of your TPA.

Re: Payment Delays--Looks like we could improve cycle time

Bingo ccc.

If you take a company like State Auto that has 25,000 or so glass claims annually, the chances are pretty slim that a glass shop will notice any changes to the program pricing. Even in a strong State Auto Market, any given shop will only see 5 maybe 10 claims a month and will agree to the program pricing "just this time". SGC will come back to Hal and tout the 98% acceptance because all of the negotiations were piecemeal and over a period of time. SGC is able to gain acceptance a job at a time without significant pushback.

On the other hand, when State Farm or Allstate puts their 2+ million claims out for bid via an offer and acceptance, the feedback should be immediate and a better indicator of the market's acceptance of the program and pricing.

Obviously, the big boys are either doing their homework and are in sync with the market or the market isn't strong enough to push back with alternative pricing.

If the other insurance gorillas (Farmers, Nationwide, AMFAM) ever push SGC to an offer and acceptance model, Hal's 98% happiness factor goes out the window.

Re: Payment Delays--Looks like we could improve cycle time

Hal,

Are you really down to 2% program non-compliance? Seems like just yesterday that your folks were handling 20-30% of the glass claims as paper invoices at non-program pricing.

Re: Payment Delays--Looks like we could improve cycle time

well yeah it is easy to say that a shop has the option to decline the ridiculous pricing offers. but if these shops that are tired of doing good work for low pay want to pay the bills they have to take what they can get. when you have people working out of their trucks with no overhead and doing cash prices of 150.00 installed it is like a double ***-whipping. you get it from tpa's offering you dirt for oil and from low-lifes who do it as side jobs and are getting the glass through the back door from suppliers and making pure profit for their beer money.
it all gets better, right? haha!

Re: Payment Delays--Looks like we could improve cycle time

I wonder whether Hal's 98% is accurate. When I bill through Safelite at our shop rates which are higher than their offered rates, does Safelite forward my higher prices to the insurance company?

I think not. I don't know, but I assume Safelite cuts our invoice down to their rates and then forwards that to the insurer for payment. So, the insurance company thinks we are "happy."

Wait 'til they get a load of our lawsuit coming their way! (not State Auto, Hal; we don't deal with you).

Re: Payment Delays--Looks like we could improve cycle time

I fail to understand all the concern for cycle time by an insurer, they pay a TPA to "handle" this if its not being handled well they should take control of the situation .

I think were flying under the radar of the real issues of steering ,price fixing,and the lies the customers are fed by these TPA uses to nab the job from the little guys . Cycle time is about 5th on my list of worries, as we do very little insurance work nowaday's

Re: Payment Delays--Looks like we could improve cycle time

Good observation TSI. It's called a diversion; designed to sidetrack.

Cycle time is their problem; getting us to play the game is the goal.

Re: Payment Delays--Looks like we could improve cycle time

Yeah my thoughts exaclty.. it really seems like a non issue for us. Im more than used to waiting 30+ days for the crumbs to pay the bill , its not like I can call anybody that gives a flying rats a** about it anyhow.

Its kind of like running to the gas station to get a gallon of gas and the car has 4 flats .

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