Health Insurers Pondering Some New Business Models
Posted Mar 03 2009 3:09pm
At some point in time we knew this had to arise. Can you blood from a stone? Right now with current economic conditions, people just can’t afford health insurance in many instances, food and rent come first. As I have mentioned before, Health Insurance companies invested heavily in IT technology, see below where 20 of Aetna employees are dedicated to information technology. One more time, the folks who invested heavy at the onset, have the money or did have the money. Insurance companies still have some pretty hefty reserves to keep them from going involvement, rainy day funds. Is the bottom getting closer to falling out in this industry as what happened on Wall Street? Have the algorithms finally caught up with the lack of assets (money) for consumers to purchase? Questions I think about a lot.
Health Insurance is strictly risk management and there are some good points and it is needed, but has the pendulum swung completely in this direction? Add on the fact that science (genomics) is also throwing some left hooks out there as it is not predictable, nor is the time frame for R and D, so who has access to the new drugs as well, cost issues are up front and foremost here.
As with Wall Street, perhaps there’s a bit of greed that has rolled around here as well. Again, it all comes back to the folks with the technology and the complicated algorithms (formulas) that have figured out over the years how to profit at everyone else’s ignorance. Perhaps outside of Health Insurance and Wall Street we may have been functioning like a big PC with no anti-virus protection, and we all know what happens there. A few weeks ago with the SEC and the whistleblower case is perhaps one more good example of where lack of interest and technology let down a lot of people.
I certainly hope that Kansas Governor Kathleen Sebelius has enough hands on IT knowledge somewhere along the line when taking over the HHS position as she’s going to need it, 70% of that job is forming around Health IT, sign of the times. In the last couple of years, we have seen a lot of legal battles in court, balance billing, Medicare payments, you name it and it all pretty much comes back to the health insurance industry with patients and hospitals duking it out over balance billing. Perhaps if there had been a little better business plan with a little more effort from the insurance companies in working towards better healthcare, we would not be where we are today, and granted they may not have as much in the till, but did greed have something to do with all of this?
Again, once more I suggest we shop at the “smart” store for leaders and make sure we can go to the table with the big players such as Wall Street and Health Insurance companies so we can hopefully end the losing game of “liars poker” that has been consuming large amount of money for a very long time. As time goes on each day, the lack of technology with those on the other side is becoming more apparent each each day and we need to stand up, educate ourselves so we all all sit down at a bargaining tale and come up with a good business plan for all, and leave the “greed” matters outside the door. BD
GO ahead, take a guess: Which company has developed a 2,000-page strategic plan and gathers its senior executives almost every other working day to talk about how well they are doing?
Health plans are losing millions of members who say they can no longer afford their products. Some big employers are becoming increasingly frustrated — and vocal — about how much they spend on health benefits. Smaller ones are being crushed by ever-rising health care costs.
“The health plans are going into a very dangerous time because many of them have destroyed the perception of value they were trying to create,” Ms. Skolnick said. “The reason really comes down to affordability,” said Mr. Borsch, who predicts that the number of people who lose or drop their commercial coverage during the economic downturn could approach 10 million. “It looks like the pace of erosion is really accelerating.”
The insurers “don’t have a clue about providing what we really want to buy,” said Dr. Paul Grundy, the executive at I.B.M. who oversees its health care efforts.
No longer a company of just underwriters or claims handlers, Aetna has about 20 percent of its work force dedicated to information technology.