Payers Refocus Efforts on ROI for Member Engagement
What a difference a year has made to the payer market. In late 2012 Chilmark Research published the first version of our Payer Benchmark report — detailing how leading payers were beginning to adopt emerging consumer technologies. We found a market where significant experimentation was occurring, but little if any broad, member wide deployments and a market still trying to understand social media.
This week we are releasing the next iteration of this report – Benchmark Report 2013: Payer Adoption of Emerging Consumer Tech – Payers Continue their Pursuit of the Digital Consumer. Based on the research I conducted for this report, I find it simply amazing to see how this market has shifted over the course of a single year.
For one thing, the traditional health insurance business model continues to erode, as the Affordable Care Act (ACA) has capped medical loss ratios (MLRs) and has completely stripped payers of their ability to underwrite based on health risk.
Meanwhile, payer-provider realignment is ongoing. Hospitals are partnering directly with employers or launching health plans that might compete with payers in the employer market. Likewise, some payers are acquiring providers to more closely align financial interests with healthcare services delivered. All this bodes well for rising interest in payer-provider-aligned population health management and patient engagement technologies.
In addition, the ACA/Obamacare has come to be seen as inevitable, and Health Insurance Exchanges (HIX) are forcing payers to seek out new places in the minds of consumers and within the broader healthcare ecosystem — with an increasing focus on engaging and retaining consumers.
Outside of healthcare, the consumer tech space continues to defy our expectations. It is easy to see how in the past year that emerging, low-cost activity tracking technologies have spread far beyond early adopters.
These and other macro forces are pushing payers toward the digital consumer in ever more multi-faceted ways. For example, payers have drastically pulled back from their flurry of experimentation in 2012, and are now focusing their efforts into fewer, more precise areas where they foresee strong potential for ROI.
One change from 2012 is the pull-back in creating mobile app versions of member service portals, as have health & wellness app launches. (This makes sense: in general, very few payer-launched or payer-owned mobile apps have gained any kind of significant traction, with iTriage as a notable outlier, and they already had good traction prior to acquisition by Aetna).
While payers may have pulled back from rapid experimentation along certain lines, this does not mean that they have given up on the digital consumer. To the contrary, we continue to see growing investment in payer-owned consumer platforms, biometric tracking initiatives, the next generation of social media, and more… all detailed in the report.
This report profiles an expanded set of payers as compared to the first edition, across commercial, Blues, and provider-aligned categories. These innovative payers are exploring the wild west of digital consumer engagement and learning as they go. The report describes their experimentation in detail, what initiatives are working and why, and where promising new territory might lie. Any organization that is looking to build-out a strategy that leverages consumer tech for member/patient engagement will find this report invaluable.
We hope our subscribers enjoy the read…as much as we enjoyed the research.
Matt Guldin · 9 months ago
John Moore · 12 months ago
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John Moore · 5 years ago
“Chilmark were one of the first industry watchers to recognize the importance of population health and are still one of the most sophisticated in their apprecition of what is going to be needed to transform health and care.”-Former SVP of PHM at Cerner
Benchmarking Payers Adoption of Consumer Tech
Awhile back, a large health insurer (payer) commissioned Chilmark Research to do a market scan on how payers across the country were using emerging consumer technologies to engage their members. We found this project to be quite interesting and rather than have much of that research sit on the shelves forevermore, we decided to build upon it.
Today we are releasing the results of that effort.
Our latest report: Benchmark Report: Payer Adoption of Emerging Consumer Technologies takes a close look at over 40 payer (health insurers) initiatives that are using a wide variety of consumer technologies (apps, social media, games, etc.) for member engagement. Here’s the PR announcing the report’s release.
Now it is well-known that payers have had a very mixed record in engaging their members. Part of the problem has been trust as members are justified in taking a cautious approach when sharing their health information with payers for fear of future denials. Secondly, many payer initiatives have been half-baked wherein payers have not been fully engaged themselves in the concept of member engagement.
But as we pointed out in a post earlier this summer, this is all beginning to change. Numerous market forces are now pressing down upon payers and payers are increasingly coming to the realization that they need to deploy member engagement solutions that work. Payers are now going to where consumers already are seeking to engage their members via a variety of consumer-based technologies. This report is our initial effort to gain a greater understanding of what payers are doing today and provide some guidance as to how their efforts will evolve overtime.
One thing we have learned in the course of our research is that despite all the talk, the majority of these efforts are in their infancy and that the vast majority of payers have not even begun to venture down this path. Therefore, we intend to update this report on a periodic basis to benchmark payer adoption of consumer tech in support of member engagement and gain an even deeper understanding of what works and just as importantly, what does not.
Thanks to the many that we have interviewed over the course of the last several months to compile this report as your inputs have been invaluable.
Payers Take Another Stab at Engagement with Consumer-based Tools
It is now nail-biting time, as we here at Chilmark Research brace ourselves for the upcoming Supreme Court decision on the legitimacy of the Affordable Care Act. We as a nation are indeed living in very interesting times and I am again reminded why I find healthcare markets endlessly fascinating (and perplexing). (Editor’s note: This post was written by senior analyst Cora Sharma and highlights some of her latest research that looks at payer strategies for patient/member engagement.)
Of interest is just how many of the ~30 million uninsured US citizens will land on insurers’ doorsteps in 2014. Even if the Individual Mandate is upheld, it is still uncertain just how many of these uninsured individuals will opt to pay penalties rather than purchase health insurance.
For my patient engagement research, I have spent the past several months speaking with executives at large payers about their consumer-focused strategies. Just how are payers planning on using relevant consumer technologies to keep new individual customers engaged and healthy? After such a dismal track record over the years around health/wellness/DM initiatives, is it worth another go-around? (Cora’s research will culminate in a forthcoming report to be released within the next couple of weeks.)
Payer Initiatives in Consumer Technologies
Kaiser Permanente and Humana actually began experimenting in this area circa 2008, creating flash-based, online health games for children. In 2010, UHG released the first version of the OptumizeMe social game App, Anthem released its Grocery Guide App (now EOL), and Aetna partnered with OneRecovery.com to provide a social network for members in recovery.
Now all of the major payers have ongoing products, partnerships, and pilots around consumer-focused health and wellness and disease management — though with varying respective strategies (the upcoming report explores these 35 ongoing payer initiatives in detail).
The figure below shows an interesting slice of data around social games, in that the majority of these initiatives are becoming social and ‘gamified’:
Note: Data point positions do not represent degree of gamification/ social-ification. These are just meant to illustrate number of initiatives in each category
Another trend our research has found is the willingness of payers to look beyond health and wellness and towards the complex FDA-regulated space of chronic disease management solutions (partnering with Healthrageous and Welldoc), as well as seeking to improve member ‘Wellbeing’. Aetna’s partnership with Mindbloom to offer members the premium version of the Life Game™ is one of the few efforts we found among payers that looks to engage the full spectrum of health of a member with a focus on Wellbeing.
Growing market in payers that can transition to a post-FFS world.
In the future, we predict that this market will continue growing along two distinct tracks:
As many readers may know, the health insurance industry is going through a period of rapid transformation. Payers with the means and the wherewithal to innovate their business models are purchasing providers, as well as partnering with them for data-sharing agreements and ACO-like payment contracts. Some large payers are also getting into the ACO-enablement business through acquisition of software companies.
Insurers who do not innovate their business models towards a post-FFS (fee for service) world (be they pure insurance providers or mostly claims processors) will find little incentive to experiment heavily with emerging consumer technologies. The crux of the matter is that they will never have the long-term incentives (nor the culture) to shift gears away from their actuarial focus and will remain low margin businesses, if they manage to survive at all.
Affecting behavior change towards health and wellness has proven incredibly difficult over the long haul. There is scant evidence that these new payer initiatives that seek to adopt common consumer engagement technologies and strategies are meeting objectives. As the entire healthcare industry pivots towards new bundled care reimbursement models though, there may be a glimmer of hope. I remain cautiously optimistic to see payers experimenting with and adopting emerging consumer technologies, knowing that there is still a long road to travel.
Being WebMD, the leading online consumer health, it is a bit surprising that they are so late to the party as there are now quite a number of health-related social media sites such as one of Chilmark’s favorites, the focused Patients Like Me or the more broad ranging site MedHelp. Thus, with this announcement one would think that WebMD would have studied the other sites, learned what works and what does not and provide a compelling site.
So much for assuming.
Went to the site today to check it out, here are the quick pluses and minuses:
In the plus column the site has…
1) A number of exchanges to address a wide range of conditions.
2) Some of these exchanges focus on care giver issues, such as parents of children with depression.
3) Registered members can create their own exchanges.
4) For diseases with medications, a list is automatically generated of the relative popularity and use of various medications with member reviews (e.g. side effects, overall effectiveness, etc.).
In the minus column the site…
1) Is cluttered and noisy, hard to determine what to read that is pertinent and what is fluff. Seems to be an amalgamation of everything not to do in a social community site, let alone one addressing health & wellness.
2) Has far too much noise coming from ads. Now ads are not a bad thing if they pertain to the disease/condition within that exchange. Finding a postmenopausal ad in a section on cancer or a Charmin toilet paper ad in childhood depression? Please, WebMD, the technology is there to do a better job than this for your members.
3) Takes to long to navigate due to all of the click-thrus to see pretty much everything. Since online ad pricing algorithms often have a site retention/click metric, WebMD is purposely making it more difficult to get at content to maintain its ad pricing power – not nice WebMD.
4) Has very little if any policing seems to be occurring leading to the creation of many communities (exchanges in WebMD parlance) that are of little value or just plan silly. A favorite in the Anxiety-Panic category was the Exchange, OMG Zombies.
5) For some conditions there can be several exchanges. Fine, nice to have choice but which one is truly a vibrant exchange. Well, that answer is not apparent until you click-thru (more clicks, more ads) to determine if an exchange is vibrant. Royal pain in the a**.
WebMD’s attempt at using social media within the context of these exchanges is late to market and one of the poorest executions of such that we have seen. Granted, maybe we had high expectations for WebMD as it truly is the 800lb gorilla in this market. Sadly, those expectations were not even close to being met.
Hey WebMD, why not take a smidgen of that $800M in cash and investments you have hoarded up and actually do this right. It will be an extremely modest investment that could pay off handsomely rather than this half-baked attempt which is frankly embarrassing and will likely fail.
Snippets of the Week
Due to a tremendous workload at Chilmark Research, creating cogent, free content is expensive, at least to us. Therefore, to provide value to you dear reader without taxing our synapses to the breaking point this post will give you a few highlights from te week that caught our attention.
The recommendations for meaningful use paid a fair amount of attention to the issue of consumer/patient access to their medical records. The big question, however, is just how much access is appropriate? Does one let the consumer see absolutely everything within the record including all notes despite how esoteric they may be, challenging to understand and potential for mis-interpretation? For some perspective:
A very thoughtful, extremely funny and intelligent physician who goes by the twitter handle of @doc-rob wrote about his own practice’s deliberations on the subject and the comments are just as insightful as his.
The Boston Globe had an article in today’s edition on Beth Israel’s decision to let their customers/patients have full access to the complete record.
And the Wall Street Journal’s own Health Care Blog also drew attention to the Boston Globe article with again, some great comments.
Outside of mental health, where there are some extremely valid reasons for not sharing clinician notes, the consumer should indeed have full access for as we have seen in countless other industry sectors, information liberation solves far more problems that it creates.
This week, CCHIT’s Mark Leavitt hosted two townhall meetings to present changes that CCHIT is considering in its certification process. Prompting these changes is CCHIT’s clear desire to be the go-to certification entity for all “certified EHRs” which is the only technology that will receive reimburse under the HITECH Act. Going through the slidedeck our quick conclusion was that CCHIT is bending over backwards to try and address concerns in the market about their certification process.
What Chilmark likes about the proposed changes:
A three tiered process that acknowledges different technologies and architectures for EHRs (e.g. modular apps and roll-your-own) that fall outside of the common EMR vendor model upon which CCHIT was founded.
A pricing model that is fair and reasonable.
What Chilmark is not so crazy about:
Like anything, the devil is always in the details and what CCHIT presented is still pretty thin on details. At first glance, we see a growing complexity in the certification process as often times, software does not abide by strict boundaries. This is especially true from EMR-Comprehensive vs. EMR-Modular.
Not convinced that CCHIT has the resources available to keep up with technology developments and changes to insure innovative products reach the market quickly. More complexity is typically a time sink of major proportions.
The HIPAA and EMR blog’s author, John did sit in on both CCHIT townhall meetings and has a good write-up/analysis that is worth the read.
Mark Leavitt also wrote a piece for California Health Care Foundation’s iHealthBeat providing his perspective on the monumental changes coming to healthcare and of course the great role his organization plans to serve in those changes. My advice to Mark, don’t count your chickens before they hatch.
Last Friday, the Pew Charitable Trust released their latest study on consumer use of the Internet for health. Chilmark has a lot of respect for their work which is always thoughtful, well-reasoned, applies good methodology and results always have a few surprises. Unfortunately, have yet to read the full report, only the post that the lead reseacher, Suzannah Fox, wrote on the report. Do know this though, if you are even remotely interested in understanding how the public is using the Internet to address their health issues and also want to understand underlying demographic differences, just go read the report. I’ll be doing that myself on Sunday as I recover from the infamous Harpoon Brewery to Brewery ride tomorrow.
Earlier this month we wrote about what is arguably some of the most innovative concepts (well, they have really only piloted one, which is now preparing for broader market roll-out) from any health insurer – that from Humana and its skunk works, CrumpleItUp team.
Following SlideShare presentation provides an inside look as to how this team leveraged new marketing media techniques/technologies to get the word out about Freewheel!n. Some good lessons here for others to emulate, and not just payers. Our only regret, the slide show does not have a “lessons learned” slide on what they would do differently in the future.
WebMD Targets Physician Community Prize
Just received a PR this morning from WebMD where they are crowing that they are now Numero Uno in the physician social networking sphere. The PR claims that their relatively new social networking site, Medscape Connect now has over 100K registered users. Pretty impressive number considering they were initially caught flat-footed when Sermo came on the scene and did not even launch Medscape Connect until this past April. Just goes to show what an existing market presence can do for a company that wants to quickly gain on upstarts.
Not so sure that Medscape Connect is indeed Numero Uno though and the press release says nothing about which third party numbers they are referencing to make such a bold claim. (Note: just Googled Medscape Connect for link to site and Google ad for Medscape at top of page has not been updated – states 60K members, hmmm makes one wonder). In October at the Health 2.0 conference, Sermo claimed to have 90K registered users . According to Compete.com, Sermo is still seeing healthy growth in visitors and if one were to extrapolate, the significant uptick this fall, would put them well over the 100K number today.
With some 700,000+ physicians in the US and many times that number worldwide, there is plenty of room in the market for more than one provider of social networking tools for physicians. Another physician networking site to track is medicspeak, which is the only one that has an interenational audience. You can find more complete, abeit abstract, profiles of all three at eMedicineLive. The challenge though is converting these social networking sites into rich in content and profitable to investors opertaing entities.
A challenge that all of these sites will face going forward. It is here, with the economic model that WebMD has the edge. The vast Medscape property allows WebMD to forgo profits in one area if it contributes to click-throughs and impressions (ad-rev metrics) in another.
Beginning of the End for Health 2.0?
Late last week, one fo the Health 2.0 darlings, DailyStrength, bit the dust and was acquired by HSW Inc. Was never a big fan of DailyStrength, thought their model was just another “me-too” social network with little idea as to how to actually generate revenue. Their partnership with Revolution Health may have been a harbinger of the eventual collapse of DailyStrength.
So who the h*ll is HSW. Looking at their website, they seem to be focused on the Chinese and Brazilian markets with broad, horizontal information plays – actually just re-purposing their enlish language website HowStuffWorks. How DailyStrength plays into these existing properties or their overarching strategy is not readily apparent, unless of course they got DailyStrength for nothing, which is probably the case as there was a rumor at Health 2.0 in October that they were on their last legs.
This will be but one of many acquisitions or tent-foldings of the far too many Health 2.0 start-ups in the market today. Those that make it through the next 12 months will clearly demonstrate that they are delivering value. In essence, something that someone, somewhere is willing to pay hard cash for.
Enough of the sending of virtual hugs. Time to get down to business and start figuring out how you, Mr. or Mrs. Health 2.0 can start delivering that value proposition as this morning’s WSJ reported that several VC firms are seeing their investors are defaulting on capital calls so you will increasingly be left to your own devices to get that operating capital.
And getting back to the title of this post…
No, this is not the end of Health 2.0 as a broad movement in consumer health trends, but it will be the end of the line for many Health 2.0 companies.