Healthcare Insurers: Three Focus Areas for Differentiation

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Healthcare customer research suggests that close to 20% of the policies sold in the upcoming open enrollment period will be shopped by consumers via private and public exchanges. Not simply selected, but shopped – like car insurance, home loans, or even personal electronics. In the next few years, we expect that number to rise to 50% or higher as more employers move to private exchanges.

Marketshare leaders like Apple, USAA, and Delta have one thing in common: a commitment to creating a differentiated customer experience (CX) across all consumer touch points. These companies have taken a proactive approach rather than a reactive one – and it’s paying off. Now is the time for healthcare payers to follow suit, and begin focusing on creating an effortless experience for customers rather than reacting to churn.

“It’s much more about offering a frictionless customer experience than purely focusing on reducing administrative costs,” said Eric Grossman, former vice president of enterprise strategy at TriZetto, a healthcare technology company. “In a post reform consumer marketplace, you can’t save your way into a competitive advantage.” The ability to create an “ideal experience” will hold more weight as insurers move from a business-to-business interaction model to more individualized, direct consumer contact.

Not only will consumers shop around until they find the healthcare service they want; they won’t hesitate to switch. According to research led by PwC, more than a third of consumers said they would switch providers for health insurers if they were offered a better experience.

Switching is a real threat . . . and an opportunity. Our 2015 Personalization Benchmark Research found that the healthcare insurance provider industry ranks third to last in customer experience, just above cable, satellite and wireless providers. This widespread dissatisfaction creates openings for new entrants to disrupt the landscape.

As you prioritize your investments to stand out from the crowd, we suggest three CX focus areas that will reap the biggest ROI.

The Shopping Experience: Customers need to understand the how the plan fits their needs.

Our Personalization Research also found that consumers who were offered a solution that fit their needs were eight times more likely to be a promoter. Of course! But how do you really know what customers want? Market research is powerful, but it’s “one and done,” and usually focused on product or service features. Remember – there is a gold mine of customer intelligence in your contact center. CX trailblazers incorporate technologies such as text and speech mining into their analytic strategies, using resources they already have, such as call recordings or chat logs, to uncover customer needs quickly.

They leverage this data strategically to drive product development, for example, or use it daily during open enrollment to optimize upstream and agent communication about products and options. Consider these opportunities:

    • Design effective enrollment packages and determine the best timing for rollout
    • Identify and fix website language that creates customer confusion, especially in the areas of plan options and coverage boundaries
    • Coach agents with real-time, in-call alerts to help them recommend the best plan for each customer
    • Track positive sales outcomes to quickly identify best practices for replication across centers

The Claims Experience: You can’t ignore claims, but not for the reason you think.

When we talk to healthcare insurance leaders, many suggest that their single greatest competitive strength is in their ability to process a medical claim quickly and correctly, and at a low cost to the consumer. Not surprisingly, when asked, consumers said effective transactions are table stakes; fast, cheap, and accurate claims are little more than baseline expectations. There is no reward for simply doing it right.

Paradoxically, the penalty for even the slightest error is high, and can be a deal breaker for winning the consumer’s continued business next year. For one client, we found that outdated claims processing guidelines drove 280,000 unnecessary calls into customer care, skyrocketing costs and putting every one of these customers at risk.

If you don’t have an end-to-end view of the internal processing steps married to the customer journey, it’s time to get that done. Once you identify the pain points, you can uncover upstream root causes and address issues at the source.

This may be more critical than you would expect. Payers are facing a broad range of new, nimble competitors whose administrative costs could be as much as 80% lower than the cost of today’s typical plan. Matching such a cost structure may seem like an unattainable target to legacy plans, particularly in their current business model – but if they are to defend their market share from these new competitors, plan leaders should carefully consider whether and how they can fundamentally rethink their business models. In a Black Book Market Research survey of healthcare BPO users, almost 70% of the payer managers said they were considering outsourcing as among the best solutions.

The Ease of Doing Business Experience: Omnichannel experience is too broad . . . optimize the actual channels used.

In their quest for an effortless experience, a growing number of healthcare customers seek a digital experience, using websites and apps almost exclusively for plan information, administration, and benefit utilization. Others prefer speaking with support or sales agents, and still others prefer reading member information they’ve downloaded or received in the mail.

If you are to capture all of these unique demographic segments, be ready to calibrate key elements of the customer experience to specific preferences – and be able to service this increasingly empowered consumer when, where and how he demands. The first step is to map your customers’ channel preferences against their actual behaviors.

For example, although one of our clients had optimized their website for self-service bill payment, they soon found that many of their customers were choosing to pay their bill through the IVR instead – without success. The IVR was failing to support this simple task, but our client couldn’t figure out why. By isolating failure points to determine root cause, and synching IVR design with customer requirements, we developed specific recommendations to improve the customer experience. The client launched multiple initiatives that addressed menu structures, missing authentication, customer-focused language, and inconsistent personae. Within three months, customer success in IVR bill payment increased 76%, creating a better customer experience for more than 22% of their customers.

A Final Word: It’s all about the experience.

To summarize: the US healthcare industry is in a state of reinvention, and the changes have created opportunities for payers to shine and differentiate, or struggle in turmoil, risking continued difficulties or even extinction. Consumers are increasingly empowered to make purchase decisions, demanding not only high performance, but also a calibrated, personalized experience at every interaction and touchpoint. Successful companies will be able to move beyond legacy comfort zones of efficient transactions, and become purveyors of healthy lifestyles with more of a value-added engagement business model than simply a risk avoidance mindset. Succinctly put, the experience economy is alive and defining the healthcare markets, and you must adapt if you expect to thrive.

The Convergys team has had the privilege of working with more than a dozen industry-defining healthcare payers. Key learnings gained from our experience point to recommendations you can use:

    Reset – or walk away: The healthcare market is becoming more like the retail market. Reset processes and culture away from a legacy wholesale mindset, or you’ll be unable to participate.

    Earn and re-earn: Loyalty to healthcare insurers is no longer implicit or based on a “follow the herd” business model. Instead, leverage every interaction and touchpoint as you compete to earn – and re-earn – consumer participation.

    Reinvent and challenge: The old mantra of efficiency and effectiveness simply doesn’t cut it anymore. Follow the lead of truly innovative companies and reinvent yourself to win, and don’t be afraid to challenge a few “sacred cows” along the way.

    Compare elsewhere: Dare to be great, not just better than the others. Comparing healthcare companies to other healthcare companies is no longer a meaningful exercise. Instead, compare your performance to brands that are the best in the world at creating effortless customer experiences.

    Measure to uncover: Measure performance with an eye toward gaining deep, actionable understanding of consumer needs, down to the individual customer. Design a successful measurement system that will illuminate key Moments of Truth to help you design new groundbreaking experiences for your customers.

    Break the mold: Don’t fall victim to legacy processes. Instead of falling into the trap of “That’s how we’ve always done it,” break the mold and excite your consumers with a personalized, truly differentiated experience. They will reward you with long-lasting loyalty and profits.

Image: Thinkstock

Mike Cholak
Convergys
Mike Cholak is a consulting practice executive in the Customer Management line of business at Convergys. He leads a team dedicated to delivering a full suite of analytic services to the Company's clients that help leverage customer intelligence and feedback to optimize long- term customer loyalty and profitability.

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