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Healthcare has been a hot topic for quite some time now, and I only expect it to become even more prominent as elections here in the states come up. And similar to politicians, I am focusing most of this discussion on health insurance, rather than the entirety of health care.

I have had the pleasure of spending a lot of time tackling branding issues in health care, and have noticed some pretty significant trends. While much of this has been driven by the 2014 health care reform (which we have no clue how it is actually going to turn out…), I believe that the reform simply expedited some shifts that were already in the works.

The major trend I am talking about here is consumerism. A popular trend in many industries, but with some very unique implications with health insurance.

As it stands now, reform is going to make purchasing health care very similar to what sites like Expedia have done to the airline industry. In 2014, a significant portion of health insurance will be purchased through an online “exchange”, and through this you will enter your details and the site will show you a page with multiple options from multiple insurers that fit your needs, highlighting the cost of the plan. Again, think Expedia: a list of options, small company logo on the left, and people mostly focusing on the price rather than the carrier and other services. Companies don’t have to put plans on the exchange, but the Massachusetts Health Connector (mahealthconnector.org), an exchange already in place, shows that most will.

Another factor is that all Americans will now be required to have health insurance. This will bring in large numbers of individuals responsible for purchasing their own insurance, some healthy 20-somethings that have just said they don’t need insurance, and many low-income, higher-risk individuals who have not been able to afford it. Oh, and insurance companies will be required to guarantee them insurance (which, unfortunately, means that all underwriters will be looking for new jobs in the next few years).

While there are many other factors, let’s just summarize what we have so far:
- Exchanges will bring cost more to the forefront of decision-making, somewhat commoditizing the industry
- The majority of the new purchasers will be looking for low-cost plans
- Many of these folks will have high-risk profiles, which can be dangerous for insurance companies
- Insurance companies have to accept anyone regardless of risk profile

This is why many in the health insurance industry call it health “insurance” reform rather than health “care” reform. It does not address the underlying cause for the rising costs. However, it is the way it is, and all of this has implications on health insurers.

This new market represents a huge opportunity, so most carriers are not going to choose to not compete. So how are health insurers going to compete in a low-cost, high-risk market where people unfamiliar with how insurance works are going to choose based on an exchange that puts a high emphasis on price alone?

This is where consumerism comes in (finally, right?). Health insurers are going to have to message more and more directly with consumers rather than through employers. They are going to have to adopt a more friendly and straightforward look and feel in order to attract individuals who now have so much more responsibility on their shoulders, and are likely overwhelmed with the decisions they have to make.

Another interesting factor that is different in health care, in order to lower costs insurers actually have to ADD benefits. Sure, they can limit networks and coverage. But to be able to safely cover this new market they are going to have to offer a more complete solution, not just ancillary insurance such as dental and vision, but preventative programs and additional services to help individuals manage health issues and navigate the health care world. The more an insurer can prevent issues from happening, or catch them before they get worse, the lower the cost for the insurer and ultimately the individual.

It is these extra services that insurers will have to develop and communicate to consumers. They will have to reach them on a more personal level to help them understand all the additional value they get for the same price. It seems easy, it is better for the consumer and the insurance company. However, this is an extremely difficult task because 1) health insurers are not used to talking directly to consumers, and 2) consumers tend to have strong negative perceptions of insurance companies, so it is tough to make them believe this “friendly, helpful” positioning.

It can take some significant changes to really make individuals view insurers differently, often times stronger than just some new imagery, colors, messaging, etc.

One of my past clients, Blue Cross and Blue Shield of Florida, has made significant strides in becoming a more consumer-oriented company. They introduced (and we helped brand) the first ever retail store, Florida Blue, where people can come in for all of their health needs. Whether they have questions, want to take a personal health assessment, need a health plan to lose weight, or need help managing asthma, they can do it all here.

Now, this takes significant investment, but it is a very visible proof point to help shift consumer perceptions of the entire enterprise. They have developed many other value-added services and low-cost products as well, not specific to the store. Whether nurse hotlines or 24-hour care consultant lines, BCBSF is focused on offering individual consumers a more complete solution for all health needs, and communicating to consumers what this extra value means to them. Research has shown that they are on the right path and have made great strides, but there is more to do.

And here are some forward-looking statements to end on. In order for health insurers to continue to lower and manage costs, I believe you will see more and more of them venture into care delivery, starting with primary care, but in the future I wouldn’t be surprised to see more specialized care and potentially hospitals.

So while insurers are not going to abandon the profitable employer side of the businesses, overall you have likely already seen many more consumer directed campaigns and products directed towards individuals. It is something they will all need to focus on now, because there is not much time left to shift consumer perceptions before that 2014 reform hits.