In a recent AIS webinar, Oliver Wyman’s Health Services lead Todd Van Tol presented “Insurer Strategies for Large Groups.” In his presentation, he explores how the healthcare insurance market is evolving, noting that by 2018 one in three Americans are expected to be buying a different insurance product than they do today, through a channel that didn’t exist three years ago, receiving 30% of their care outside of a traditional health system. He summarizes the fundamental changes underway in the health insurance industry:
- The pace and scale of the adoption of private exchanges is uncertain. But we are bullish on what private exchanges can do over time. While there is uncertainty in terms of the rate of uptake in the near-term, we have seen that when private exchanges are adopted, they change consumer behavior, leading to the purchase of higher-deductible plans and more ancillary products.
- In product design, more health plans are putting out high-performance networks at lower prices. Deductible levels continue to rise. Payers are managing across dual objectives, balancing an increasing need for affordability, value, and choice and the continued need for broad, national networks. We expect interest in alternative care delivery channels will continue to grow as employers increasingly demand more innovative network and product solutions.
- There is significant opportunity for payers in the ancillary space. Payers are expanding the portfolios of products that they make available to consumers into other health and related financial protection offerings. The employee benefit product suite will continue to expand. Opportunity exists in untapped core group, voluntary, and diversified plays. Core medical serves as an anchor product in the employer/employee decision set. Benefits purchasing across all categories is converging as players attempt to integrate choice across product types. A total risk protection value proposition can expand and deepen customer relationships.
- The insurer who can be an advocate and partner with their members can build on that dynamic and have a lifetime relationship with their customers. There are many ways that the health plan can help solve the many hassles that consumers face in healthcare. Insurers are focusing on product and consumer experience innovation, including anytime access, transparent shopping, integrated rewards, and personalized recommendations.