2018 and Beyond – The Advanced Class of Health Care
Yes, I went to Princeton for engineering. People often call attention to that if they’ve read my bio. It was – and is – a great spot for education, and the classes were tough. But a lot of places in life are, and the health care industry is no different. Right now, we’re in the advanced class.
ACA changes reset all the rules we knew, understood and brought to our business. Since 2010, we’ve had to take all of the knowledge we’ve gained over the years and find different ways to relate it to the new reality. It’s like going from college to grad school. Just when you think you’ve mastered the subject, you discover there is actually more to know, or at least new ways to look at it, understand it and apply it.
Certainly experience is a big help when tackling a complex subject. It guides us and informs our approach going forward. But you can’t underwrite business successfully without knowing what’s going on in the current market. There are new tools that can help, especially those that aid in making predictions or determining trends. Valid business experiments also can lead to bigger, better and more useful ways to meet and exceed customer expectations.
Today, large claims are everywhere. We can’t sit idly by, hoping they will go away (like that 8 a.m. Monday exam). We need to think about the future. Just seven years ago, pharmaceutical costs were about 15 percent of a claim. Now they are nearly 30 percent. A $100,000 claim for pharmaceuticals is no longer abnormal. So we have to adjust our thought process to the new reality of our industry and put smart practices into place to gain better control of results.
One trend is that smaller groups are showing an interest in self-funding. But as a Stop Loss carrier, we have to know the risks, communicate them and be responsible in the decision to take on a new client, regardless of size. After all, if we are to be providing financial security, we have to be financially stable ourselves, something that cannot happen if we aren’t applying knowledge to our decision-making. But, that’s where something new like level funding comes in as an option. It’s giving smaller groups some autonomy over their benefits plans while offering more consistency in their ability to pay claims – a progressive concept for a new phase in insurance.
There also are more and more innovations in care delivery being introduced and new ways insurance is being integrated into the process. When you have a solid foundation of knowledge and can discern the nuances of how the market is trending, you can better determine the tools needed to succeed and provide clients with solutions.
Knowledge is meant to be shared. Problems are meant to be solved. I’m here to talk and to listen. At HM, we want to know what’s on your mind, and we’re happy to share what’s on ours. So go ahead, raise your hand. We need some discussion in this class – it’s what will help all of us earn a good grade and advance to the next level.