With the health insurance sector facing shifting market dynamics, business as usual is no longer an acceptable strategy for insurance carriers in 2019.
Among multiple complicating factors, government policy has the power to impact insurance providers’ revenue strategies and employers’ group benefits plans. On the federal front, the NDP has promised to institute a universal and comprehensive national pharmacare program in 2020 if they win the election.
Insurance carriers and employers face additional challenges as the baby boomer generation ages and chronic disease incidence increases, often with comorbidities or polymorbidities such as depression in conjunction with chronic pain, or diabetes coupled with high blood pressure and cholesterol.
Not surprisingly, the cost of drug plans is escalating, especially for specialty medications.
Mental health claims are also on the rise, as 60 per cent of U.S. and Canadian organizations are noticing an uptick in mental illness and substance abuse issues compared to two years ago, according to a 2019 survey released by the International Foundation of Employee Benefit Plans.
How are health insurance carriers responding to the evolving landscape to meet customer expectations, all while minimizing health-care costs? They are “leveraging digital tools, artificial intelligence (AI) and analytics to gradually move toward an efficient, digitally integrated ecosystem,” according to a 2018 report from global digital consultancy Capgemini.
Although the insurance industry is often perceived as trending towards the highly conservative end of the business and technology innovation scale, change is in the air. The sector outspends 12 other major industries when it comes to investing in AI, according to the Global Trends Survey 2017 of 835 executives by Tata Consultancy Services.
Consumers have more complex needs than ever before and are more knowledgeable about their choices, demanding personalized insurance offerings and tailored communications.
They are at home on mobile devices and accustomed to moving effortlessly between devices and platforms in their daily activities. Moving forward, insurance companies must focus on providing a frictionless customer experience across multiple touchpoints.
Insurance carriers are shifting from a multichannel strategy to an omnichannel strategy to help customers move swiftly and seamlessly between devices without disrupting their experience, according to a 2018 report from market intelligence agency Mintel Comperemedia.
Forward-thinking insurance carriers are using technologies that can personalize the customer experience through tailored messaging, target audiences and pricing. Plus, more accurate risk pricing will become a reality, according to Mintel Comperemedia, as carriers collect and analyze vast amounts of consumer data to create hyper-personalized policies.
Insurers are also providing employers with reporting tools, helping them to analyze data to deliver more personalized employee experiences while better managing workplace health costs.
In addition, predictive and behaviour analytics are enabling predictive diagnosis and personalized care across the customercare continuum, according to analysis from Capgemini.
Group benefits go digital
With the workplace in flux — from the influx of millennials and retiring baby boomers to the heightened talent war — companies are implementing digital technologies to build their employer brand and develop an engaging culture.
Similarly, HR organizations are embracing technology to create personalized employee experiences as they guide the employee journey.
One of the challenges insurance carriers face is how to simplify the administration of group health insurance for employers. With HR facing a dynamic work landscape of potentially rapid company growth, transforming workforces, and a constant flow of regulatory changes, group benefits management becomes a complex process — especially as benefits plans expand and innovate to meet evolving consumer needs.
The recent introduction of digital group benefits administration systems in the Canadian market is helping to simplify the process. With an automated workflow — from onboarding through to benefits enrolment — these digital solutions are designed to sync across systems, reducing data entry to a single point and ensuring employee data is shared seamlessly across human resources, group benefits and payroll.
This type of approach mitigates the risk of error and enables a personalized employee benefits experience.
Insurance companies also recognize it’s a time-consuming task for HR to chase down employees to collect their personal information for the purpose of group benefits administration. To help lessen the burden, forward-thinking insurance carriers are moving towards employee self-enrolment. With access to personal data at any time, employees can manage their benefits plans from the convenience of their smartphones and personal devices, eliminating both the paper trail and reliance on HR.
No more auditing nightmares
Auditing and manual reconciliations can be a continuous, never-ending loop between the insurance carrier bill and payroll reconciliation.
With an automated solution, the time-consuming cycle of adjustments and reconciliations between employees’ benefits premiums and pay is eliminated.
By ensuring there are no costly discrepancies between health insurance bills and payroll, a digital solution decreases overall risk, ensuring benefits compliance and accurate reporting for life insurance claims, disability claims and workers’ compensation.
This editorial was originally published in the June 1st edition of Canadian HR Reporter.