Whether plan sponsors like it or not, employees expectations of the health insurance purchasing process are being shaped by influences outside of their control. Ann Mond Johnson, chairman of the board of managers at ConnectedHealth, a private exchange provider, and a speaker at this weeks Private Healthcare Exchanges - New York, delves into how the health care consumerism movement is shaping employee benefits and how brokers are engaging with private exchanges.
How do you define consumerism in a private health care exchange, beyond using the term Amazon-like shopping experience?
Its a combination of two things that are happening. One is people are taking on more responsibility for their finances as it relates to their health insurance. Were seeing a shift toward a lot more financial exposure for consumers. The second is they are really having their expectations shaped by [influences] outside of health care. Whether you call it an Amazon-like shopping experience or a Travelocity-like experience, the fact is people are walking into an exchange environment which is really leveraging the technology to make the selection experience more robust for the consumer with expectations that are shaped in other areas of their life. Theyre not going to check their consumer hat when they walk into the health experience.
I think what were seeing is [that] people want more information; they want better insight into what theyre getting for those dollars. From our vantage point, we really see exchanges as the latest evolution of health care consumerism and providing consumers with a somewhat familiar retail experience although that still needs to be developed and with more choice and transparency so they can make more informed decisions.
How can employers and brokers apply this concept of consumerism to a private health care exchange? How much influence do brokers and employers have in the exchange equation?
We see a significant level of engagement by both brokers and employers in the products that are offered and the experience. That has been very interesting. Brokers who are keen on providing value to their employer-customers know there are a certain number of plans that you should offer, theres different configurations. Theyre very engaged in helping their employer-clients figure out the level of contribution that might be made if theyre moving to a defined contribution, theyre very engaged and work very closely with the private exchanges in ensuring consumers have a certain level of transparency in terms of the price and how the dollars flow across the various plans. They are not, in our experience, stuck at all. The good ones are very much engaged in providing a great series of understandable choices to consumers.
Are there any pitfalls or red flags employers or brokers need to be aware of before promoting this concept of health care consumerism?
It is still new for people. The whole idea of being an engaged consumer in your health insurance is very, very confusing even for those of us in the industry. Its not a straightforward proposition; it will take some time. But were hearing different things from consumers this year than we did last year. Their familiarity with terminology such as premium and deductible and copay has increased, and theyre recognizing that premiums are not the only thing they have to pay attention to. Its a level of familiarity that did not exist a year or two ago.
It would be a mistake to think that just because its confusing, its not going to change. The more people take on responsibility, the more theyre going to want to have information and transparency into cost and quality and be able to create their own value equations. Consequently, I think were going to see a lot more that will continue to change.
Carriers also need to be engaged to make sure theyre providing, in consultation with the employer or the broker, a really robust array of products and services so they have real, legitimate choices. To just offer one or two plans does not make an exchange.
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