Health Insurance Carriers: Uncertainty Driving an Innovation MandateBy: Jenna Greco Health Insurance, Revenue Growth Strategy, Sales Strategy, Sales Transformation
Co-author: Arshad Carim is a principal at the Alexander Group
Looming mergers, disruptive new entrants and growing public and private exchanges—these are the uncertainties that cloud the health insurance market today. In response, carriers look for opportunities to weather the storm and emerge stronger. Across the industry, successful carriers are improving operational efficiency to lower costs or investing in innovative products and services to drive profitable growth. Adoption of both approaches requires careful tuning and alignment of the marketing, sales and service strategy.
Improving operational efficiency
Streamlining the operating model allows carriers to more efficiently sell, implement and service employer groups. Identifying inefficiencies and opportunities to automate and redesign the process will reduce the time, energy, and ultimately, the cost required to serve customers. Carriers can take these operational savings and invest them back into the business to drive innovation or provide savings for members.
The Alexander Group (AGI) recently worked with a carrier to evaluate the sales and service process. AGI identified efficiency opportunities and improved ease of doing business with producers and customers. Early in the sales process, opportunities emerged to streamline how sellers review and select benefits and transition to underwriting for pricing. Further opportunities arose to simplify activities and automate workflow from point of sale to account setup and implementation. This improved speed and accuracy of account structure and implementation of benefits.
- Redefine roles and responsibilities of sales and service resources to clearly define who is responsible for what activities and who to engage at each step of the process.
- Size the sales and service organization to appropriately staff roles required to support the process.
- Train and enable sales and service teams to educate on new processes and reinforce new accountabilities.
- Track adoption and effectiveness of new processes through clearly defined metrics and success measures.
Developing innovative products and services
To drive profitable growth, carriers need to attract and retain customers with innovative products and services that get to the heart of employers’ most pressing issues–maintaining a healthy population and providing quality care at an affordable price.
Recent market trends challenge carriers’ traditional leading value propositions. New entrants in the marketplace and the consolidation of top carriers pressure remaining carriers. For example, IDNs entering the insurance marketplace challenge the local market value proposition many carriers rely on with their own local market and customer-focused value propositions. Consolidation at the top allows these carriers to gain scale and influence over providers, thus reducing the effectiveness of the price and coverage value proposition for the remaining carriers.
Now more than ever, there is pressure to deliver value through differentiated products that closely align with customers’ needs. Carriers are investing considerable time in product innovation to understand these needs and develop and launch products that will give them a competitive edge. Innovations include more robust self-funded products, emphasis on non-core medical products such as ancillary and wellness, and ways to drive employee engagement.
Fueling this product innovation demands a strong partnership with sales to influence innovation and go-to-customer strategy execution. This includes the following imperatives:
Understand buyer profiles including the features and capabilities buyers want. Product, marketing and sales need to work together to identify products and services that meet buyer needs and value propositions that resonate.
Align marketing, sales and service motions to target the right buyers and design a sales process attuned to the buyer’s process.
Enable talent with training that goes beyond product features and supports sellers to become consultative advisors that can articulate value propositions aligned to buyer’s unique needs.
Compensate sellers with an incentive plan that rewards for focusing on innovative products and services core to organizational strategy.
The health insurance landscape has one constant–change. Successful carriers of the future will evolve strategy, adapt and streamline their models, and innovate with new products and services ahead of the competition. Health insurance sales organizations that heed this innovation mandate will remain nimble and reinvent themselves, reaping the benefits through increased productivity and continued growth–likely at a faster pace than those who favor maintaining the status quo.
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