Driving today’s distribution trading flow is arguably still the well-calibrated business-to-business (B2B) broker/consultant model. But the landscape is expanding. Digital distribution, professional employer organizations, consumer-direct platforms, and, yes, even brick-and-mortar retail, are just a few areas growing at lightning speed.
But digital distribution industry leaders are perhaps inadequately prepared for the next great tipping point. Industry influencers need to answer three specific questions to stay ahead of healthcare’s ongoing disruption: When will employee experience become an industry focus? How should B2B2C value proposition be established, and what technical requirements are necessary to do so? Who will control tomorrow’s customer experience?
To help industry leaders find solutions to these posed questions, we led an executive session – Distribution Disruption: Who Will Control the Future Trading Flow? – at last November’s Oliver Wyman Health Innovation Summit, alongside Jason Hover, VP of Health Plan Business Strategy and Private Exchange Business, BCBS Michigan and Steven Wilkinson, Senior Director of Total Rewards, Serta Simmons Bedding.
Here were our three key takeaways:
1. There is a blurred line between distribution and product manufacturing.
Marketplaces must leave their comfort zones behind in 2017 and start distributing a broader range of services that goes beyond health insurance. The owners of well-rounded central platforms that aggregate data and interface with the consumer will drive new trade flow. For instance, insurance companies serving as both product manufacturers and distributors will more successfully streamline diverse consumer needs by effectively leveraging data and product interface capabilities.
An insurance company will increase ROI by effectively managing consumer data-driven technology. Advises a recent whitepaper from Maxwell Health, an insurance company must not only cover an employee’s financial risk, but offer exceptional value, low overhead costs, and great digital experience. After all, an employer/consumer will naturally want to switch over to a comparable insurance company where they pay less and experience less red tape. So, unless a winning strategy is implemented to create ongoing consumer stickiness and unparalleled value, previously established consumer loyalty will only disappear.
At the end of the day, more employees are taking on sizable risk with high deductible plans tied to exorbitant medical bills. Employees just want more guidance on how to navigate the ins and outs of their care journey. Providing ongoing support based on what consumers and employees value is crucial for a tipping point to occur.
2. Listen carefully to the Millennial voice.
The Millennial consumer voice – reportedly the largest living generation in the US, says Fortune – is pushing insurance companies to keep up with the digital age. This influential generation – of which 74 million people comprise nearly a quarter of total health consumers – perceive consumerism and choice quite uniquely compared to their parents and grandparents, according to Oliver Wyman’s Consumer Health Survey.
Says Oliver Wyman analysis, 55 percent of Millennials prefer scheduling a guaranteed appointment with a specialist within a week. But Generation Xers, on the other hand, reportedly prefer scheduling same-day appointments with a family doctor. And those of the Baby Boomer generation, or older, reportedly prefer home visits from a healthcare professional.
Nonetheless, as consumers burdened with even greater expenses demand more choices, more traditional brokers are consolidating to stay relevant. Therefore, let’s focus on better understanding each consumer’s holistic spending habits to help them succeed along their insurance journey.
3. Disruption will occur when consumers demand digital transformation.
The customer of the future will spend their hard-earned money for on-demand, instantaneous shopping experiences, predicts global creative consultancy Lippincott. These experiences will help consumers establish their identity, express their evolving viewpoints, and feel connected to their online environment. Tomorrow’s consumer demands seamlessly integrated services from corporate game changers like Amazon, Apple, and Netflix as the new normal.
This consumer attitude will shape the new wave of disruption and provide an often overlooked opportunity to turn voice into value. Consumers demand personalized engagement with their healthcare insurance company. Tomorrow’s consumer wants to meet his or her health goals while concurrently maintaining financial security – using technology to do so. For example, sending consumers personalized content, like a video sent to their inboxes about their health status, or a clever physician anecdote, as opposed to a generically composed snail mailed letter, promotes brand loyalty.
Monetizing tomorrow's digital consumer experience means blurring the line between distributing and manufacturing products. Advises Maxwell Health, for example, insurance carriers should adopt a technology-based marketplace approach. Mobile experiences, for instance, will let insurance companies manage how consumers – especially Millennials – purchase and use services, which grants valuable actionable insights into how a consumer extracts value from this exchange.
But the future is not about getting Baby Boomers to become digital experts. It is about implementing fast, simple, and effective communicative technology that an elderly population (and all consumer populations, for that matter) prefers to use over traditional communication methods.
Implementing These Steps Comes Down to Communication
To ensure the above three ideas become reality, communication must become a habit across all organizational levels – from the top C-suite executive to the part-time, unpaid intern. Flattened hierarchical management – like the one Steve Jobs favored for Apple – will help leaders reach their collective goals with more passion, power, and purpose. Communication that extends well beyond a basic vendor relationship, involves all stakeholders early on, and establishes clear expectations at the onset fosters intelligent strategy design.
When metric-focused baselines are tweaked, pilots are carefully planned upfront, and a clear end goal is established early on, change will follow. And, when mistakes are made along the way, as long as leaders recognize failure is a healthy part of an organization’s journey, setbacks will become comebacks.