Case Study: Software Helps Health Insurance Giant Analyze, Extract Mainframe Rules

Health insurance provider balances valuable mainframe logic against need for more manageable system

How do large companies find the right balance between continuing to use the valuable business logic in their mainframes, while extracting some rules and moving them to systems that are more modular and manageable? In short, how much to buy, how much to build, and how to best leverage existing COBOL code?

Highmark Inc., based in Pennsylvania, is one of the country’s largest BlueCross/BlueShield health insurance providers, processing a quarter of a million health care claims a day. The company is in the first year of a massive five-year program to modernize its 20-year-old mainframe-based claims processing software. The goals include aligning IT systems with future business objectives, reducing declining technologies, and aligning core systems to enhance business capabilities.

In the end, Highmark hopes to make its code more component-based and manageable, and to identify business services that can be leveraged across the enterprise. The program will also address converting from the current 3270 mainframe screen-emulation system, to Web-based technology.

As part of the project, Highmark is using tools from Relativity Technology’s Modernization Workbench. The Relativity suite offers tools to help companies find and extract the often complex, highly valuable business logic buried within legacy applications.

Highmark’s 12,000 employees include some 650 developers, of whom perhaps two-thirds are COBOL programmers (the rest work in Java and PowerBuilder). The current mainframe claims system runs about 8,300 COBOL programs and is a critical part of Highmark’s business and IT strategy.

According to VP of technology management Mike Kronenwetter, Highmark realized the opportunity that the Relativity products offered years ago, when the company first began developing a strategy to component-ize its software environment and move to a service-oriented architecture.

Highmark has been using Relativity’s tools for several years, but has started leveraging the suite more heavily in the past year as part of its five-year legacy modernization project. “We have some very good mainframe COBOL systems in-house,” according to senior systems consultant Gary Free. With the help of Relativity’s suite, he says, “we [want to] leverage the business rules built into those systems and rearchitect the code into a business-oriented, component-ized architecture” that will be part of an SOA environment.

Moving completely from the mainframe simply doesn’t make sense at Highmark, given the sophistication, complexity, and value of the claims processing software. The claims system comprises about 26,000 artifacts and 7.2 million lines of code, and converting that volume of code manually to another platform would be overwhelming.

“From a performance, processing, and accuracy perspective,” Free says, the mainframe-based system is still extremely functional. “It is by no means a problem that it’s running on the mainframe,” he says. “From a cost and common-sense perspective, why would you take something that works that well and take it off the mainframe?”

However, Kronenwetter says, the claims system does need to be made more manageable—so that Highmark can add additional capabilities more easily. “Building [a system] around industry standards and component-supported SOA … allows you, over time, to right-source different aspects.”

Highmark is running multiple programming environments. In addition to its substantial mainframe system, the company maintains an open systems environment (including J2EE) and IBM’s WebSphere as an application server. The company is also in the process of moving some systems from Unix to Linux, and it maintains a fairly large Oracle database installation.

Creating the Right Balance

Deciding the balance between maintaining the millions of lines of code on the mainframe, versus moving key business functions to other systems, is a continual process at Highmark.

“We have been looking at creating the right balance for a number of years,” Kronenwetter says. “That’s why we’ve created our sizable WebSphere environment—we’re creating functionality where we feel it’s most suited.” In some cases, that has meant taking functionality from the mainframe environment and either replacing it, as Highmark has done in some cases over the past few years, or augmenting it by using Web tools to add front-end functionality to the backend mainframe.

As the legacy modernization project moves forward, Kronenwetter says, “We will [eventually] be using the mainframe predominantly as a large server that will house business rules and data access.” They’ll continue to evaluate what business logic should remain on the mainframe, and what should be converted to Java on the WebSphere system, based on metrics such as performance and total cost of ownership.

As the project moves forward, Free says, “We’re finding that we can very rapidly go into existing COBOL code and extract the logic around certain business objects.” Once Relativity has extracted the logic, business analysts and programmers can translate it into business rules, and ultimately into business requirements. The end result: Components that are business-oriented, rather than geared to structured COBOL.

Highmark is also using a Relativity tool called the Application Profiler, which gives them the ability to take the artifacts produced by the business-rule manager in Modernization Workbench and publish them so they can be viewed and modified by business analysts through a browser. “It’s a very nice feature we haven’t used until now,” Free says.

In considering leveraging tools such as those from Relativity, Kronenwetter offers this advice: Understand up front what you’re trying to accomplish, and what a robust, feature-rich set of tools like those from Relativity can—and can’t—offer. To be successful, he suggests, involve all the stakeholders from the start. “Once you’ve decided that you need and want that kind of capability, lay the groundwork across all the areas of the company that need to be involved.”

Highmark is still determining ways it can use Relativity in other areas of the company, but the return on investment is clear already. Although the company hasn’t gathered formal metrics yet, Free says he has seen dramatic speed improvements in code conversion. “How many programmers and business analysts would this take, if we were to do this manually? You can see it; we’re cutting days—if not weeks—off the project just by using the tool. It’s that fast.”