Innovation Series Part 1: Amazon's Influence on the Health Insurance Experience

As a broker, it's my duty to my clients to be on the vanguard and keep them informed of new ideas and strategies that can move the dial for their business. That being said, I'm excited to share part 1 of a 3 part mini series, where I share my top 3 innovators for 2020 in the employee benefits space. Things are starting to shake up...and that's what I like! I'll start here with a story about my Mom, which will resonate with many of you and frustrate most...unfortunately.

A Story Too Commonly Told

My mom was always the best skier in the family, but all those years skiing "bumps" started catching up on her knees. Unable to do the things she loved like play tennis, she consulted a local orthopedic for potential non-surgical solutions. She received three injections, although to no avail. A reasonable person might think the bill would be on the high end in the thousand(s) range, but not the hundreds of thousands range. Months later, her bill came in at over $200,000! It put my Mom into tears. She would have never gone to him if she knew how much it would cost...

Consumer Transparency

Notice that you can research prices on literally anything you consume before you buy it...cars, TV's, houses, selfie sticks, T-rex costumes, you name it...yet, when it comes to healthcare, we're completely in the dark...People are avoiding seeking care because they're afraid of what the cost might be. We tend to trust our doctor's recommendation on a treatment path, but now with potential underlying conflicting interests, how do you know the recommendation puts you and your wallet first?

With over 2 million people adversely affected by medical expenses and 62.1% of bankruptcies caused by medical issues, Consumer-Driven Health Plans have become more like "Consumer Gets Run Over" Health Plans for many Americans.

In 2020, the average national cost for health insurance was $456 for an individual and $1,152 for a family per month. I've heard many times from employees, "Why are we paying $XXX a month in premium just to have an insurance card in my pocket, but I never use it?" Well, the 80/20 rule applies. Approximately 80% of all medical spend is consumed by only 20% of the population, meaning that everyone within the plan carries the cost consumed by a few, driving as much as 15% of total health care spend.

Let My Mom and Your Mom Live Their Best Life

With traditional health insurance, many people like my Mom struggle to find the information they need to make the best decision for them, and employers have been forced to consider one of two sub-par options to contain costs—a) trim the benefit or b) shift more cost to employees. Neither of which are satisfying nor solving the problem.

BUT it but it doesn't have to be this way. What if you could have an insurance plan individualized to your needs and you could research, compare, and clearly understand the cost of services before you even step foot in a doctor’s office?

Insert Innovation #1: BIND

My favorite innovation of the year is BIND, which offers the data, technology, individualization and transparency to change the cost curve for both employers and employees—something the fully-insured market urgently needs.

Let's take my Mom for example. With this new design, my Mom would have a plan with core coverage for primary and specialty care, emergency and hospital care, and preventive care. Then, she could "buy up" coverage for the planned knee-replacement surgery for a few months in the same way a consumer might opt to get HBO for a time to watch Game of Thrones.

Not only does this 'on-demand' approach to buying health insurance appeal to modern day consumers wanting customization to their needs, but on a larger scale it drives price transparency and eliminates wasteful health care spending. No deductibles or coinsurance, which have a universally-felt feeling of frustration, confusion and worry on employees.

It turns out, when you give people the tools they need to make informed decisions, they do! We've all wanted Amazon to come to the health insurance market, and BIND is the closest thing I've found yet.

Like this theme of transparency? Stay tuned for Innovation #2!!

Happiness & Health,

Jillian

Sources: https://www.businesswire.com/news/home/20180628005088/en/Nations-First-Ever-On-Demand-Health-Insurance-Has-Arrived

https://www.yourbind.com/employers

https://medcitynews.com/2020/10/how-bind-benefits-ceo-will-use-105m-to-upend-the-health-insurance-market/

https://www.insurancejournal.com/news/national/2018/10/08/503575.htm