One of the media hot topics this month is certainly the rise health insurance premiums.
The second highest health insurance premium increase in a decade seems to be creating a “perfect storm” for unprecedented lapse rates in the industry. There are a number of reasons why the 6% average rise in Health Insurance Premiums may see far more consumers switch in record numbers to more favoured health insurers.
‘Industry disruptive’ switch campaigns such as Onebigswitch (backed by media conglomerate news.com.au) and the growing adoption of brokers such as iSelect.com.au, Comparethemarket.com.au, Helpmechoose.com.au and choosewell.com.au and are making it easier for customer to “lapse” and switch to another fund. Watch the coverage of Onebigswitch on Sunrise here
A health insurance policy “lapses” when a policyholder decides to stop making payments to an insurer often because they have moved to another fund or decided that they cannot afford health insurance altogether.
However, buyer beware! The act of switching funds actually raises the overall costs of funds to acquire new customers. These costs are then indirectly passed on to consumers, thereby reinforcing a vicious cycle of rising premiums.
Its also becoming increasingly challenging for consumers to compare “apples with apples”; there are now over 20,000 policies in the market with complicated exclusions and restrictions.
To counter the problem, health insurers are revolutionising their ‘customer experience’ efforts to encourage members to stay with their current funds.
Ten health insurers including Medibank, BUPA and NIB are collaborating on a pioneering research White Paper developed by Energesse to better understand consumers and drivers of retention.
I was recently interviewed on radio about these issues and what consumers, particularly older members of funds, should do at this time to protect their health and financial interests. You can listen to the interview here.
More importantly, with all the industry changes and the need to innovate, we have partnered with international strategy consulting firm Palladium, to deliver a cutting edge webinar on “Transforming the Customer Experience in Healthcare”. This will help healthcare organisations, such as health insurers, hospitals and government bodies can get closer to their customers and transform their business models to meet these rising consumer expectations. Its not to be missed – registration details here – please feel free to share the link with your colleagues in the industry.
Webinar: Transforming the Consumer Experience in Healthcare
Tuesday the 31st of March 2015 (Australian Eastern Standard Time):
8:00am AND 4:00pm SESSIONS
Register here for the 8:00am AEST session
Register here for the 4:00pm AEST session
Unless you are 100% aligned with the needs of your consumer or patient in your organisation, this session is for you.
Finally, I am taking my own advice and reviewing my own health insurance policy this year. If you’re reviewing yours, this article from Business Insider may be useful.