[Originally published January 2016]
As the health insurance industry completes another successful open enrollment period and the Affordable Care Act enters its third year of implementation, the healthcare business has been fundamentally reshaped. Since World War II the bedrock of the health insurance industry was actuarial calculations that predicted risk. The primary business was focused on employer groups and the business model was based on back-office processing. Today, the industry underwrites retail policies and competes not just on price, but on individual customer service. The strategic and operational implications of this shift are enormous, beneficial, and largely untold.
The need to focus on every single member is critical and difficult but that transformation has started. Significant investments have been made in the industry’s people, customers, and technology. The first dividends are starting to show. Of course, bad press and shrill voices sometimes dominate the tremendous work of thousands of dedicated people across the industry who are targeting — and hitting — the triple aim of better access, improved outcomes, and lower cost. Regulatory and policy changes only started the process. After the compromises are reached and the direction is set, the architects and builders have the massive, groundbreaking job of putting in the systems that do the work.
One might think that there are plenty of examples we could borrow from, companies that manage millions of accounts, but the reality is that we have a higher standard of excellence. Of course it is annoying if an airline messes up your reservation or loses your bag. Or if your credit card mistakenly rejects a charge at the grocery store. Or if a call gets dropped when you have four bars of signal. As consumers we expect convenient, flawless service at low price, or we take our business to a competitor that claims to do a better job.
But in healthcare, those accounts are not just numbers. They are real people looking for real healthcare. They are a parent making sure that their child is properly immunized. A spouse or loved one whose partner was just taken away in an ambulance, or just received a serious diagnosis that will change their lives forever. An adult child of elderly parents who cannot fully manage their affairs anymore. These are real stories, real people, and we have to do a great job making sure they get the services they need and are entitled to by their policies. We stand at the fulcrum of the relationship between our members, our providers, and our service delivery partners. There’s no room for error.
The strategic vision is rooted in data transparency, promotion of healthy behaviors in the day-to-day lives of members, and a “frame off” overhaul of the technology infrastructure. The goal of the transformation is simple: to change the basis of customer interaction away from crisis management to an integrated part of their everyday lives. This is a once-in-a-lifetime challenge, from gathering resources to maintaining intensity, but success and survival in the new age of healthcare requires us to deliver truly leading-edge services to create an integrated ecosystem for members and providers.
There are three elements to a successful transformation: the creation of a real-time data-driven ecosystem; digital automation that helps manage every member across the health continuum, and delivering to the market a suite of robust, reliable, secure, and easy-to-use solutions that engage members in their care, and enable shared decision making between them and their providers.
Of course, there are terrific advances in the technology frameworks, user interfaces, and analysis tools; the goal is to mount the new wheels, not re-invent them. Moreover, there’s been a recent explosion of health-related data from wearable devices — from blood glucometers to step counting — and a plethora of new apps focused on wellbeing. The investment in “big data” technology that aggregates all of these streams together, sometimes using open source components, and sometimes with custom solutions, have to be part of the equation. This wealth of information enables unprecedented insights, and feeds powerful predictive models that allow engagement of our members early so they can lead longer, healthier lives.
Second, the people we insure — from the young invincible to those managing chronic conditions — need to be empowered and engaged in their health. From the delivery of home monitoring tools, to tele-health alternatives for a doctor visit, the industry has to offer a menu of services that empowers members to take better care of their health, where they want to be, when they need the help, and how they want to receive their care.
Finally, the new era of managed care will focus on authentically-shared decision making between the member and their clinical care providers. This requires private and convenient access to accurate data so the provider can authorize services and referrals for members based on their benefit plan. In addition, by providing transparency into the care decision made by the provider to the member, they are empowered to partake in their own care. This brings the ecosystem together, puts the member alongside the provider in the decision making, and lets the insurance companies behind the scenes become a pro-active, constructive partner in care.
This is an exciting time in our industry. These transformations — from regulatory requirements to customer expectations, from advances in medicine to better access to care — are critical to surviving and even thriving in this new consumer-centric environment, and are mostly untold success stories of an industry that has joined the 21st century.