Health Insurer Growth Plans Held Back By Tech And Infrastructure Limitations

Health plans are eager to grow their Medicare business but may not be able to meet their goals unless they build out their tech and administrative infrastructure further, according to results from a survey backed by health plan technology vendor HealthEdge.

The survey, which was conducted by market research firm Survata, was designed to gather information on how payers are addressing the demands of the growing baby boomer demographic. To Survata researchers spoke with 201 health insurance executives directly involved in Medicare and/or Medicare Advantage as of business.

According to the researchers, 92% of these execs said that their Medicare or Medicare Advantage plans are currently growing and that they are growing or plan to grow their Medicare Advantage lines more quickly than their traditional Medicare business. Nearly all (96%) of respondents said that the value-based model of Medicare Advantage had either a significant moderate impact on the desire to grow the business.

To support these efforts, they plan to optimize design-based care programs, modernize the technology systems (21.4%), hire more people (20.9%) design and refine high-performing networks or ACOs (18%) and spend more on sales and marketing efforts targeting these populations (16.4%). (On a related note, check out this data from HHS on challenges Medicare ACOs face in coordinating care. There’s clearly a non-trivial amount of work to do here and existing technologies don’t seem to be sufficient.)

The execs told researchers that their sales and marketing outreach efforts include not only standard marketing and advertising programs (27.4%), but also efforts focusing on social determinants of health) 24%), incentives rewarding healthy behavior (22.4%) and tailoring programs to tech-savvy digital consumers (14.9%).

That being said, respondents admitted that their internal infrastructure might not be able of supporting such growth. The challenge they cited the most frequently (named by 35.8% of respondents) was being saddled with inadequate technology and infrastructure, followed by a lack of needed IT staff or resources (33.8%). In addition, just under 30% said they lacked the in-house experts needed to keep up with market forces.

Having adequate technology in place has become particularly important to their business, given that many boomers and millennials have begun to favor digital solutions. For example, the survey found that 42% of baby boomers prefer to shop for coverage online, making a powerful, flexible and easy-to-use web presence more important than ever for health plan growth.

Of course, these stats are intended to make the pitch for HealthEdge, which is designed to offer a smart upgrade option for those still stuck with less-flexible legacy systems. It appears that the platform integrates initiative functions like member enrollment and quality and compliance data collection to population health management functions.

My instinct is that many health plans would prefer to do their own systems integration and pick best of breed applications for key functions rather than bringing in a vendor to unify these efforts. However, this only a hunch.

It certainly seems clear to me being flexible enough to adapt to change could be very helpful in growing a presence in the fast-moving Medicare Advantage market. Health IT leaders, what would your take be?  Do you think health plans should consider buying solutions that address this sector, or is having complete control of how these applications are built and managed more important to their future?