Re-inventing the healthcare broker business model
By Keith Lemer, September 2011
The need for new, cost-controlling technology is becoming even more imperative for healthcare brokers.
It's no secret that America spends more on healthcare than any other country in the world, so new and innovative ways of tackling escalating healthcare costs are generally welcomed with open arms. Particularly in the face of new health reform laws, the need for new, cost-controlling technology is becoming even more imperative for healthcare brokers who play a vital role in ushering in competitive health insurance options for their clients in an effort to stay one step ahead of their competitors who may be looking to take their business.
Cloud-based healthcare performance management (HPM), a technology-enabled, data-driven strategy that helps organizations reduce healthcare costs and improve outcomes, is becoming an invaluable tool for brokers as it introduces a new methodology to the enterprise management of health plans and policies. Technically speaking, HPM is software-as-a-service (SaaS), a service-oriented healthcare operating system that leverages health plans' HIPAA-compliant prescription data to predict a plan's future costs and recommend risk-mitigating action plans. Analytics and predictive modeling, built around customized workflows and campaign tools, optimize the real-time trend analysis of a plan and give instant feedback on a plan's success.
HPM technology provides brokers with the unique capability of using an organization's prescription data to survey key workforce-population risk factors and trends and set into place preventive programs that work to stop high-cost claims before they are incurred. Effectively leveraging data to make smarter, cost-saving business decisions helps elevate the role of a healthcare broker to that of a trusted advisor, as real-time insight provides a previously unattainable level or transparency into his or her clients' health plan trends.
"The winning edge for employers, employees and brokers lies in understanding the dynamics that are having a negative impact on the health of the employee population — and in enough time to do something about them," explains Tony Cannata, managing partner of the Atlanta-based brokerage firm The Clearview Group.
Working with Cannata as its broker, an Atlanta-based media company using HPM was able to address key risks identified by the HPM analytics system by putting into place targeted wellness programs that ultimately resulted in a 79-percent engagement rate among the company's members and almost half a million dollars in savings in the first year alone.
"To me as a broker, I now have technology in front of me that I can then consult with my clients on a much more proactive rather than reactive basis to figure out how we're going to impact their costs today — not at the next renewal, which may be nine months away," says Robert Petcove, president and CEO of Cherry Hill, N.J.-based Advanced Benefit Advisors, Inc. "This is a very different kind of message than we have using carrier-based programs."
With health costs projected to continue to increase into the decade and a new Aon survey predicting that employers will spend up to $10,000 per employee in 2012, brokers must realign themselves with forward-thinking technology alternatives that provide real-time solutions that deliver the best and highest cost-reducing results to their clients. Early broker adopters of HPM have seen their clients experience a greater understanding of their plan's healthcare data and what it means; they've been able to put into place specific programs in time to improve outcomes, address productivity issues and affect positive change in absenteeism — all of which directly correlate to an improved bottom line.
"The early adopters of HPM are certainly going to have something the others don't," says Bill Lavis, a partner at Oakland, Calif.-based insurance advisory firm Sitzmann Morris Lavis. "I'm going to have a leg up on my competition because I've got clients seeing tangible results using HPM. I'm able to walk up to my competitor's clients and show them the results that I've got.
"They're going to then turn back to their existing advisors and say, 'Well, why aren't you doing this for us?"
Keith Lemer is president of WellNet Healthcare Group, Bethesda, Md.
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