Can Health Plans Provide Better Member Experiences? Yes!

I was a speaker at Microsoft’s Health Plan Executive Forum in Jacksonville, Florida last week. As you might expect, I talked about customer experience.

Dennis Schmuland, MD, Microsoft’s Health Plan Industry Director kicked off the morning with a video that showed how current and planned Microsoft technologies would revolutionize the healthcare experience — for both patients and providers. It was pretty cool; like something from a Sci-Fi movie. You can see the video posted on Microsoft’s HealthBlog.

Next up was Anthony Nowlan, Chief Medical Officer, CentriHealth, Inc., and former Director of the NHS Information Authority. He gave a great speech called “Organizing Health Care in the Information Age.” He started by walking through the history of healthcare starting in the 1800s. It turns out that one of the key problems that we have today is that our current institutions (hospitals, labs, etc) were created in a period where the primary issue was acute care. As Dr Nolan said, “patients came in, got treated, and then they either got better or died.” But in today’s environment, the majority of costs come from chronic care. And you can’t solve the current problem with the old institutions; consumers need to be more involved. So his speech focused on how to use electronic health records to reorganize the healthcare system.

My speech was titled “Health Plan Member Experience: From Enraged To Engaged.” I borrowed some material from Liz Boehm (one of Forrester’s healthcare analysts) to show that member experience was becoming more important for health plans. One of the reasons is that cost containment for chronic care requires some behaviorial changes. But consumers don’t trust health plans for basic interactions, never mind listen to their wellness and disease management recommendations.

I then showed some of my research on customer experience, loyalty, and satisfaction. Here’s a small snapshot of that information:

  • Health plans came in last place out of 9 industries in our Customer Experience Rankings; and were also lowest in each of the individual areas: useful, usable, and enjoyable.
  • The highest rated plan in the rankings, Kaiser, only ended up 75th out of the 112 firms we examined.
  • 40 year-olds give health plans the lowest customer experience ratings.
  • Seniors give health plans the highest customer experience ratings.
  • Health plans have the lowest rating for satisfaction with online interactions and virtually tied for last place in satisfaction with phone interactions.

Of course, I couldn’t leave the attendees without a path to follow. So I explained how they could use Experience-Based Differentiation as their blueprint for improving customer experience.

After the presentation, one of the participants asked a good question: “Can we (health plans) ever have satisfied members, since we need to reject many of their claims?” My answer was “You can absolutely raise satisfaction levels. While you may never be as enjoyable as Borders, there’s no reason for interactions with health plans to be any less useful or usable than with any other industry.”

The bottom line: Health plan member experience is a chronic problem, but it’s curable.

(P.S. I don’t generally write about my work with specific clients, but Microsoft approved this blog post)

About Bruce Temkin
I am a customer experience transformist, helping large organizations improve business results by changing how they deal with customers. As part of this focus, I examine strategy, marketing, interaction design, customer service, and leadership practices. I am also a fanatical student of business, so this blog provides an outlet for sharing insights from my ongoing educational journey. Simply put, I am passionate about spotting emerging best practices and helping companies master them. And, as many people know, I love to speak about these topics in almost any forum. My “title” is Managing Partner of the Temkin Group, a customer experience research and consulting firm that helps organizations become more customer-centric. Our goal is simple: accelerate the path to delighting customers. I am also the co-founder and chair of the Customer Experience Professionals Association (CXPA.org), a non-profit organization dedicated to the success of CX professionals.

2 Responses to Can Health Plans Provide Better Member Experiences? Yes!

  1. Brian Lunde says:

    Bruce, thanks for this interesting post.

    I think there is a more fundamental issue with customer experience from the standpoint of insurers (a.k.a. health plans). Because of our third-party payor system in the U.S., the insurers primary customers are employers, not the people actually getting care. And so, I would argue that insurers’ business strategy has to be (1) control costs for their primary customers, while (2) managing dissatisfaction among insureds. In other words, customer experience for insureds has to be “just good enough” to prevent them from exerting too strong of an influence on employers choice of health plans.

    I agree there is an incentive for health insurers to build trust with consumers, because through trust they can improve their ability to influence consumer’s compliance behavior–i.e. staying well–and thereby bring down costs. But this is a long-term play and I fear that health plans won’t be able to make it work because of the constant short-term cost pressure brought about by (a) spiraling health care costs and (b) the third-party payor system.

    Until consumers have a more direct stake in the real cost of their care–creating a more natural market in which cost and customer experience can be “mixed” in different ways to offer differentiated value propositions (e.g. Costco vs. Tiffany & Co.)–I think health plans will be forced to live with a much more narrow set of viable CE strategies.

  2. Bruce Temkin says:

    Brian: Good point. The current structure of healthcare does not really reward (or encourage) health plans to provide a differentiated experience to members. The top thing they need to do is cater to employers that make the decision about which plans to offer to employees. And employers generally care mostly about costs.

    But a couple of things are changing that dynamic. First of all, the number of individuals who get coverage directly (without an employer) is growing. This puts member experience much higher on the list of to-dos. Also, the path to expense control (which employers really want) requires behavioral changes of many members to help manage and avoid very costly chronic case issues. If plans can establish a better relationship with members, then they’ll likely have a higher success rate with these initiatives.

    Hopefully, health plans have enough motivation to at least improve member experience. They certainly have a lot of opportunity to improve.

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