Last week I read an article in TechCrunch called “Cake Health, The ‘Mint for Health Insurance’“. This article is about a new start up, called Cake Health of course, and it really got my attention. Cake Health aims to rid healthcare consumer of their headaches, and that’s quite a lofty business model considering the current state of things.
Cake Health is an online solution that prompts users to enter their health insurance credentials into their system. The system then analyzes their health insurance data and enables health insurance consumers to make better decisions. It tells the member how much they are paying out of pocket each year, how much of their healthcare costs the insurance has covered, how much of their deductible has been paid, etc. The system also provides reminders so that members don’t forget to set up important preventive medicine appointments.
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Most interesting, to me, is the fact that Cake Health provides recommendations to consumers about the health insurance plans they should consider based on their consumption of health insurance services. This will be increasingly relevant as the number of self-insured continue to rise. Overall, the health insurance market is expected to grow to almost $200 billion by 2019. As this occurs, the market will continue to provide solutions like Cake Health to help enable patients navigate through their health insurance data and explore options.
The problem is, health insurance companies are not popular with their members. As shown in a recent Forrester report, the health insurance industry ranks dead least in measures of consumer experience among the industries they track. This could potentially remove some barriers to entry leaving and provide traditional health insurance plans with some significant hurdles. Ultimately, health insurance companies will need to learn how to respond to this consumer driven market or pay the consequence of increased member turnover.
In my opinion, they should heed some lessons from this new start up and engage members with their data sooner rather than later. What do you think?