The health insurance industry is more complex than ever before thanks to the rapid erosion of the traditional health care model, a surge in high-deductible plans and a major shift toward consumer accountability.
According to the Kaiser Family Foundation, the average deductible climbed to $1,217 in 2014 – an increase of 47 percent in just five short years. In addition, Commonwealth Fund researchers found that premiums for families with employer-funded insurance rose 73 percent while premium contributions by employees soared by 93 percent in the last decade.
The avalanche of health care choices and responsibilities has forged a new world for consumers who are not only facing ever-increasing deductibles, but also tasked with understanding a growing number of services and accounts. Consumers need to better understand all of their options, become more educated about the benefits they choose and stay fully informed about what their decisions mean for their health (and their finances).
Fighting a common misconception
As we continue to ask individuals to shoulder more financial responsibility for their health care needs, there’s a fundamental mistake we first need to address as an industry: The belief that individuals understand health care as it stands today. They don’t.
Between deductibles, out-of-pocket limits, co-insurance, health savings accounts, flexible spending accounts, and all the other terms we throw at them, the typical consumer doesn’t understand the ins and outs of their health care policy. While they might know if something is covered or not, they still aren’t 100 percent sure what all of the numbers in their bill, health statement and/or explanation of benefits documentation actually mean.
This lack of understanding leads to a state of consumer confusion, which will only intensify as changing health care economics make them increasingly accountable for health care decisions that directly impact their wallet. So what can we do to help consumers achieve clarity?
Taking a page from the retail and financial services playbooks, the health care industry needs to put the consumer first and rethink its approach. Forward-thinking organizations have driven many advances over the last several years to embrace the concept of health care consumerism – and, as an industry, we need to continue that momentum toward consumer-driven health care (CDHC).
Embracing consumer needs
The emerging era of CDHC requires an updated business model, and health plans and administrators need to keep up with the changing demands to minimize benefit costs, maintain control and create a competitive edge, health plans and benefit administrators need to focus on delivering a simple, yet comprehensive, consumer brand experience.
Looking at the typical retail scenario, consumers usually understand what they want before they buy their next laptop or dishwasher at the store or online. However, the foundation for the general consumer experience remains undefined in health care. Consumers are unsure what questions to ask or what information they need to make informed health care decisions, so the market as a whole needs to evolve its messaging and the overall consumer experience it delivers.
Answering the call for consumer-centric health care experiences starts with four core components:
1. Welcome consumer perspective. Health plans, benefits administrators and employers all need to proactively seek out consumer feedback. Going beyond delivering what a consumer “might” want or need and finding out what questions they need answered, which resources will resonate, and which formats are easiest and most logical for each consumer will be the true consumer-driven health care nirvana.
Consider hosting quarterly lunch-n-learns to invite direct employee feedback, discuss any potential misunderstandings and encourage ongoing dialogue. Consumers need to be heard, and waiting until the next open enrollment period nullifies many of the educational opportunities. We need to ask consumers what tools they need, analyze which resources are accessed most and dig into the most logical way to help guide consumers and give them the confidence to make informed health care choices.