Traditional healthcare organizations are finding their business models at risk, and healthcare insurers specifically are prime targets for disruption. New players are developing business models that bring more transparency and automation to the insurance process. At the same time, consumers are demanding better engagement that includes convenient mobile and online offerings, 24/7 access and simple, fast claims processing. In a recent report, PwC highlights that 85% of insurance CEOs report theirs is one of the most disrupted industries and are concerned about the pace of technological change.
Here are some of the pressures facing healthcare insurers::
- InsurTech companies are solving unique challenges very quickly
- Consumerism is driving better engagement
- Corporate giants from nontraditional industries are entering the market
Technology companies that are determined to solve specific long-standing problems in health insurance are proliferating and gaining market share. With a laser focus on fixing poor customer service, processing inefficiencies and a lack of pricing and billing transparency, these nimble organizations can quickly go to market with a deep understanding of how to engage with customers, solve problems and meet expectations. It is estimated that 20% of traditional insurance revenues are at risk to InsurTech companies. This trend is not slowing; U.S. InsurTech startups have raised $4.75 billion in the past five years.
The explosion of healthcare data and availability across endless access points is amplifying demand from consumers for better engagement and better, more reliable access to health information, not to mention more visibility into pricing.
Having an effective digital strategy is critical. Health insurers need to deliver enhanced transparency to pricing and billing, as well as the simplification of claims procedures concerning access and processing, or they’ll lose market share and disruption will lead to displacement.
The partnership formed by Amazon, Berkshire Hathaway and JP Morgan to solve immediate healthcare challenges through their technology, insurance and finance expertise is a sign of things to come. Additionally, consolidation by large industry players like UnitedHealth through provider acquisitions, as well as the development of health IT solutions, will continue to amplify competition for customers and influence efficiencies of scale to reduce costs. The prospective merger between Walmart and Humana, and the CVS Health acquisition of Aetna, are additional examples of the ongoing consolidations taking place to seize a competitive advantage in this constantly evolving $3.4 trillion industry.
Succeed in the face of disruption by collaborating with Flexential
Insurers must innovate and evolve technologically in order to compete and thrive. They must meet increasing demands with platforms and applications that enable their customers to quickly, easily understand and purchase their insurance coverage, and have the tools to guide how they approach their health. At the same time, they must ensure that security, compliance, 100% reliability and 24/7 access never falters.
Flexential provides secure and compliant environments that give insurers the reliability to keep their customers happy while also freeing them to focus on growing their business. With a nationwide footprint and powerful network solutions, Flexential customers enjoy low latency and secure connectivity, which will help ensure the reliable access that insurers need and expect.