Claims Platform Tiering Under Conflicting RTOs
Northbridge Health Insurance processes 42,000 claims per day through a core adjudication platform that also feeds the member portal, pharmacy benefit checks, and regulatory reporting. The BIA sponsor is the VP of Claims, who insists the platform is Tier 1 with an RTO of four hours. The infrastructure team reports that the last full restore test took 19 hours and that a warm-site failover could achieve eight hours at an additional $1.8 million per year. Claims operations can process only 6,000 claims per day manually, using spreadsheet templates and a read-only data extract that is refreshed nightly. The compliance officer notes that late claims payment triggers state penalties after five business days. Department heads have submitted RTOs ranging from two hours to 48 hours, and no one has documented the maximum tolerable period of disruption. The BIA was last updated three years ago, before a merger added two legacy claims systems. Executives want a recommendation before the next budget cycle.
1. How should the BIA lead reconcile the VP's four-hour RTO with the 19-hour restore capability and the manual workaround capacity? State the analysis steps and a defensible recommendation.
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The first step is to separate the desired RTO from the MTPD. The MTPD is anchored by the five-business-day penalty trigger: beyond that point, late payment penalties and member harm become unacceptable, so the MTPD is roughly five business days, not four hours. The four-hour RTO is a business preference unsupported by current capability.
Next, quantify the workaround: 6,000 claims per day against 42,000 per day creates a net backlog of 36,000 per day, so even a five-day outage produces 180,000 unprocessed claims. Manual processing cannot clear that within the MTPD. The 19-hour restore and eight-hour warm site both exceed four hours, but an eight-hour RTO may be defensible if critical claims are triaged and the nightly extract supports interim adjudication.
I would validate the impact curve with finance and compliance, document the gap between current and required capability, and recommend a tier that reflects MTPD and dependency risk, not the sponsor's preference. The recommendation should state either accept an eight-hour RTO with interim manual triage and funded warm site, or fund capabilities to reach four hours if the impact curve proves that delay beyond four hours is intolerable. Do not simply average conflicting RTOs.
2. What BIA outputs should be presented to executives to support sign-off, and how should conflicting departmental RTOs be resolved?
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Present a decision package, not a data dump: impact over time by day for revenue, regulatory penalty, member harm, and reputational exposure; the MTPD and proposed RTO for each process; a dependency map showing the claims platform, data extract, portal, and pharmacy checks; current recovery capability and gaps; workaround capacity and its sustainable duration; required resources and costs; assumptions and confidence levels; and a risk register with proposed risk acceptance.
Resolve conflicting departmental RTOs through a calibration workshop using a common impact scale and the same scenario. Ask each owner to justify the point at which impact becomes unacceptable, then test the proposed RTO against the dependency chain. Where departments disagree, document the basis and escalate to the executive sponsor for a decision.
The output should be a signed BIA summary with tiering, MTPD, RTO, recovery sequence, and approved gaps. This gives executives a defensible basis for budget and risk acceptance rather than a collection of departmental wishes.