Trend #1: Health Plans go Business to Consumer
Are you at all surprised that the top trend is brought to you by the health insurance industry? Are you even more surprised that this is only the second time in this countdown that healthcare reform has been a catalyst for a trend?
Before we move into the world of member engagement, let’s understand what moved the market in more simple terms. We all know that the Affordable Care Act has fundamentally changed the market for individual health insurance. Here are the nuts and bolts of how the exchange works:
- The health insurance exchange provides the self-insured with a new way to shop for health plans
- Health insurance brokers and insurers will also continue to sell plans directly to consumers
- Insurers won’t be allowed to deny coverage to sick people, and premiums will only be permitted to vary based on a select list of factors,which include age, tobacco use, family size and geographic location
- Every individual plan will have to cover a set of 10 essential health benefits, which include maternity, newborn care, hospitalization and prescription drugs
- As opposed to having to pick from a patchwork of cost-sharing options, consumers will pick from four plan types on the exchanges: Bronze plans (pay for 60% of medical expenses), Silver plans (pay for 70% of medical expenses), Gold plans (pay for 80% of medical expenses), and Platinum plans (pay for 90% of medical expenses)
- The maximum amount people will be on the hook for out of pocket will be capped at $6,350 for individuals and $12,700 for families. (Sidenote: the game theorist in me would love to spend a few hours playing around on this one)
- Whether someone shops on the state marketplaces or outside them, these elements are consistent among all plans.
- There are subsidies available for people with incomes up to 400% of the federal poverty level ($45,960 for an individual and $94,200 for a family of four in 2013).
- Some brokers and insurers will sell both exchange-approved plans that qualify for subsidies and standard, non-subsidized individual market plans
- Thirty-six states are using the federal government’s site, HealthCare.gov. The other states have their own health insurance exchange.
The Census Bureau has estimated that about 48 million Americans lacked coverage in 2012 (about 15% of the population). Now the law requires virtually all Americans to have insurance or face a tax penalty after a coverage gap of three months. The three big groups of potential consumers for the markets include: The Congressional Budget Office has estimated that about 7 million uninsured people will gain coverage through the online insurance marketplaces next year, but the role of the markets is actually much bigger than that. There are three big groups of potential customers for the markets:
- Uninsured middle-class people now eligible for government-subsidized private coverage
- Historically self-insured that are looking for better deals
- Low-income people who will be steered to an expanded version of Medicaid in states that agree to expand that safety net program
The Insurers Battle for B2C
Good UX Means Good Business
In a world where technology is rapidly advancing and user expectations are rising, it’s no longer enough to have an average user experience; to delight your users and surpass your competition you must strive for the exceptional.
Market movements the way they are, it is essential that health plans pursue high levels of consumer engagement. This is a bit challenging given a few widely known facts:
- Health insurers have long invested in business to business engagement since roughly 80% of their revenues still come from employer sponsored plans
- Consumers really do not like health insurance companies. Year after year, Forrester reports health insurance companies as receiving consumer’s lowest grade for consumer experience among all industries.
- When asked, patients aren’t really interested in having their health insurance companies engage with them. This largely boils down to trust, which is an important component in consumer engagement. When ranking their trust of various healthcare entities, consumers trust for hospitals is between 60-80%, and their trust of health plans is only 10-20%
To get a glimpse of how major health plans are preparing for this market shift, we can assessed their web traffic, number of inbound links, and Google PageRank, which have been combined into the Payer Web Presence Index. In a nutshell, the index attempts to calculate how health insurance companies are marketing themselves to consumers. The index only includes major managed care organizations operating in multiple state markets. The seven top major insurers based on this index are:
- Aetna (529)
- Cigna (451)
- UnitedHealthcare (373)
- Humana (333)
- Kaiser Permanente (323)
- Blue Cross Blue Shield Association (311)
- Anthem (WellPoint) (230)
So, how are health insurance executives responding? Last summer there was a survey of 120 health insurance executives to help us figure this question out. One of the most significant findings was health plan recognition of the need to become more “retail oriented” in an effort to improve consumer experience. More recently, another survey of 100 health plan executives shed even more light. Health plans tapped improving the customer experience as their top priority for the coming year.
So what does improving customer experience look like in action? The survey shows that member portals and e-commerce are among the top plays health plans are making to improve consumer experience. Embracing multi-channel commerce, mobility, and social media also rank high on the list of tactics. Of interesting note, in a world where hospitals are dragging their feet in connecting patients with their electronic health information, health plans are highly motivated to connect members with their data.
The early winners in health plan consumer engagement
EveryMove 100 ranked health plans across the US based on how they engage with and empower consumers to manage their own health. Health plans are ranked by these five categories of consumer engagement and interaction:
- Social media: As we mentioned in our #6 trend, having social media accounts is important. However, having accounts that engage in active dialogue with consumers is crucial.
- Mobile strategy: Including a mobile website, user friendly apps, and apps available on multiple platforms.
- Website statistics: Traffic and content as compared with competitors.
- Customer support: How easy is it to find contact information and how are plans using technology to make connecting easier?
- Customer satisfaction: Based on a survey of the EveryMove user base (100,000 nationwide)
The top 10 health plans in terms of member engagement are:
- Kaiser Permanente of California
- Premera Blue Cross
- Anthem Blue Cross Blue Shield
- Independence Blue Cross
- Blue Cross and Blue Shield of North Carolina
- Blue Cross and Blue Shield of Illinois
- BlueCross BlueShield of Tennessee
So, there you have it. Stay tuned throughout the year as we keep a close eye on the movements within the Connected Health market.