Last week, the Supreme Court upheld President Obama’s Patient Protection and Affordable Care Act, allowing the legal continuation of providing health care to all Americans. There are various opinions on the changes health insurance providers will have to make but one thing is for certain:
Providers will have to take a cost-cutting, creative approach in renovating their business models to fit the needs of consumers and the Care Act.
According to Ken Terry from CBS News, “The short-term changes that the legislation requires will have a negative impact on insurer profits. Aside from the reduction in government payments to Medicare Advantage plans, insurers will no longer be able to sell policies with lifetime caps on insurance, exclude children from coverage on the basis of pre-existing conditions, or drop adults when they’re sick under a policy known as ‘rescission.’” Furthermore, health insurers will now have to provide coverage to young adults up to the age of 26, increase premiums to meet demands of those with pre-existing conditions, and endure taxes on “Cadillac” plans (high cost, high benefit policies).
What can insurance carriers do to generate more revenue despite the new legal provisions?
Look for ways to keep costs down.
Examine every aspect of your business model, including service levels. Don’t over or under-service a customer segment if you don’t have to. For example, most young adults would prefer to handle all of their customer service needs through online channels and this could provide cost-savings to your company. Also, determine which parts of your service can be handled in-house and which can be outsourced or performed off-shore. Being cost-efficient adds a lot to the competitive advantage. [GCS provides domestic and off-shore centers, blended agent pools, and web-chat support.]
Make your company more accessible. Use the right technology. Do you have mobile apps? Does your website provide sufficient contact information?
Before, you didn’t really have a strong need for instant communication but now, your company needs to set itself apart and have information ready at a moment’s notice in case a customer or even a new, prospective customer, has questions or wants to upgrade their plan. Older processing systems, including some underwriting, will become obsolete. Make changes to keep up with the pace of demand. Consumers want interactions with insurance companies to be fast, friendly and easy to use. [GCS provides voice, e-mail, chat and text support.]
Create new products for unique markets.
Right now, many insurers lay claim on particular regional areas or members of the marketplace. With increased competition looming, insurance companies need to get creative. Try developing new products that cater to specific needs of a unique breed of customers. For example, try creating new plans for young, single adults that are cheaper and simpler for catering to their minimal health care needs. Carl Dumont, Ashish Kaura, and Sundar Subramanian with Strategy-business.com state: “In addition, to capture the expected growth in individual and small group markets, insurers will need to sell directly to these groups, manage their experience, and encourage healthy behaviors.” Utilize vendors like GCS to help sell directly to this unique group of customers based on their communication preferences. [GCS can scale programs to handle thousands of individual contacts a minute.]
Offer loyalty rewards.
This is a popular tactic for many industries and the insurance industry should jump on-board. Companies should reward long-term customers by offering extended payment plans or enrolling them in wellness programs. Give long-term plans value by adding incentives to stay healthy and stay with your insurance program. [GCS affinity selling experience and relationships can help reach policyholders with offers and service requests.]
Build brand loyalty.
Insurance companies will be driven towards a more retail-like environment, full of competition leaning on brand awareness. Position your company to not only be identifiable but also, trustworthy and reliable. Right now, the face of insurance is completely changing. Use this time to strategize and pinpoint where the company needs to be to gain positive and profitable exposure. Create brand awareness in unique marketing channels, such as social media marketing, to generate the greatest exposure. Consumers will be paying attention to brands now more than ever. [GCS maintains high contact and high service programs to keep your brand front and center.]
Create additional channels of revenue.
Some insurance companies are bound to struggle with the new health care legislation in place. Find other ways to generate revenue. Offer ancillary products, up-sell or cross-sell to customers a specific bundle of products or services and explore venturing into other relevant services, like investment, business, or consumer services. [GCS is a strong selling organization.]
Don’t be afraid to outsource.
Americans want customer service FAST. Providing transactions at lightning speed might be more costly for a company to build in-house instead of letting a trusted provider handle the responsibility of technology and processes. If there is a need your company wants to provide but in-house resources are not available, don’t shy away from outsourcing. It can help keep everyone’s costs down while still providing exceptional service that helps you puts you in front of the pack. [GCS is your source for outsource.]
No matter what approach your company takes in light of the universal health care initiative, be innovative. This is an opportunity to make positive, long-lasting changes that will help you gain significant revenue and be a trailblazer in the industry, all while setting you apart to customers in the marketplace.
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