Investor meetings offer a wealth of information about a company’s strategy and short and long-term plans. Five insurers recently completed their investor meetings. Discussions centered around technology, value-based care, social determinants of health, virtual care, and an increased focus on the consumer. Here’s a roundup of those five insurer investor meetings and what they tell us about the future of health insurance.
Date: November 30, 2021
With the largest market share among US insurers, what UnitedHealth Group says at their annual investor days can have an outsized impact on the future of the health insurance industry.
Before we dive into the presentation, a quick note about UnitedHealth’s structure. The company operates two distinct businesses, Optum and United Healthcare. Optum, at its core, focuses on health care delivery. UnitedHealthcare is the company’s health insurance arm.
For UnitedHealthcare, that organizational structure helps them achieve their strategic goal of delivering affordable health care. They’re doing that with innovative plan designs — like virtual primary care and their new Harmony plan in California. The Harmony plan touts a better experience that leverages technology and a provider network based on provider performance and efficiency.
As CVS pointed out in their investor presentation, the healthcare system can be difficult to navigate for patients. UnitedHealthcare is working to simplify that experience, creating personalized experiences for individuals and providers. They’re doing this through home-based care and expanding the ways individuals can access the healthcare system. Plus, new advocacy programs assist members during their care journey. Additionally, thanks to its relationship with Optum, UnitedHealthcare can leverage technology, data, and analytics to improve health outcomes and lower the overall cost of care.
UnitedHealthcare has grown its Medicare Advantage enrollment by an average of 13% annually over the past five years, in part due to growth in Medicare Advantage in general. The company has focused on improving the member experience through better navigation and advocacy programs. For example, advocate specialization has grown within specific communities and populations, enhancing support. Plus, UnitedHealthcare has increasingly relied on data and technology to improve care. As an example, they touted that more than 4.5 million alerts were generated in 2021 by their remote patient monitoring platform, enabling faster responses to adverse health events.
Quality of care is also a priority at UnitedHealthcare. The organization is leveraging value-based, incentive relationships with providers that pay for better health outcomes and performance. They highlighted how their Point of Care Assist solution provides real-time information about patient care benefits to providers so they can better help members find high-quality, cost-effective healthcare.
UnitedHealth Group is leveraging its two businesses — UnitedHealthcare and Optum — to deliver affordable, easy-to-use, quality healthcare. An elephant in the health insurance game, UnitedHealth Group is leveraging its size to drive down costs, improve the member experience and improve health outcomes.
Bright Health Group
Date: December 7, 2021
Compared to UnitedHealth Group, Bright Health Group is the fresh, new face in the health insurance market after the company went public in the summer of 2021. They have a similar corporate structure to UnitedHealth Group, which shouldn’t come as a surprise because one of their co-founders was a former UnitedHealthcare CEO. The company’s Bright Healthcare unit focuses on insurance while its NeueHealth unit focuses on designing, delivering, and managing provider networks.
Bright Health Group aims to align consumers, providers, and payors to lower healthcare costs in a personalized care environment. They also primarily focus on the individual market with a complementary employer offering. The company counts more than 100,000 Medicare Advantage members. Bright Health serves consumers in 17 states, though the majority of its members are in California, Florida, North Carolina, and Texas.
Bright Health Group’s consumer/provider/payor alignment model is what they feel uniquely qualifies them to continue to grow. As proof, they point to 21% lower inpatient admissions and 13% lower emergency department visits when compared to their non-aligned members. As a result, the company plans to increase the percentage of membership in this fully-aligned model in 2022. They also expect this alignment to drive down costs and improve clinical outcomes.
Ultimately, Bright Health wants to own the customer experience from end-to-end to deliver truly integrated care. Technologically, they do that with their Bright Intelligent Operating System (BiOS), which includes aligned consumer-facing and provider-facing portals.
Bright Health is trying to differentiate in a crowded market by targeting specific states and consumers and by providing end-to-end, value-based care enhanced by modern, integrated technology.
Date: September 17, 2021
Molina Healthcare focuses on three market segments, Medicaid, Medicare, and Marketplace. Medicaid is their primary segment, accounting for 77% of the company’s income. Molina’s targeting strategy is designed to provide member continuity, as Medicaid members move to marketplace plans when their income changes. They also aim to transition Medicaid and Marketplace plans Medicare Advantage plans when those members age.
Because Molina is heavily tied to government markets, the political and regulatory environment can significantly impact the company’s outlook. As they pointed out in their investor presentation, the company sees a number of tailwinds that will help the business, including the revocation of Medicaid work requirements, incentives for Medicaid non-expansion states to expand Medicaid, and the availability of enhanced ACA premium subsidies. However, resuming Medicaid redeterminations in 2022 could impact their Medicaid business.
Molina’s growth strategies revolve around government contracts. The company sees nearly $100 billion in potential revenue as 22 states plan Medicaid procurement over the next 4 years. The company also sees opportunity — and synergies with their current offerings — in dual-eligible special needs plans (D-SNPs) that enroll individuals eligible for both Medicare and Medicaid. From a marketplace perspective, the insurer is focused more on maintaining margins than a national expansion. Instead, the insurer will focus on deeper penetration into their existing Medicaid territories. The company also has an aggressive mergers and acquisitions strategy, with excess cash flow available for those purchases. In the past three years, the company has made 5 significant purchases that added nearly $8 billion in revenue.
Finally, the company believes its proven operating model can help achieve further growth. The company leverages a flat organizational structure, local decision-making, a simplified matrix, delegated authority, and management based on numbers.
Molina Healthcare relies heavily on government business and sees strong tailwinds that portend continued success. The company’s strategy includes improving margins, targeting areas where they have a strong Medicaid presence to build market share in individual and Medicare products, and continuing to grow existing products.
Date: December 10, 2021
Centene is the fourth-largest insurer by market share and, though larger, has a similar product mix as Molina. Medicaid accounts for 67% of the company’s revenue, Medicare is 14% of revenue, and commercial plans — primarily sold through ACA marketplaces — account for 13% of revenue.
The company’s plan for long-term success starts with the member experience. Though details were scant, the company aims to enhance the member experience and provide better care at a lower cost. Part of improving the member experience and better care lies in the company’s value-based arrangements. 80% of the company’s Medicaid members are in value-based arrangements, 25% of which are in upside/downside arrangements. 92% of Medicare members are in value-based arrangements, with 37% in two-sided value-based arrangements. Those arrangements provide both a carrot and a stick to providers, which tends to lead to better adherence to the value-based program.
The company plans to invest in technology to improve automation and reduce operational costs. The company indicated that it will expand digital authorization modernization to reduce administrative costs. That modernization includes leveraging machine learning to predict approvals.
Centene also continues to execute on its value creation plan, which includes plans to reduce their $35 billion pharmacy spend by consolidating to a single Pharmacy Benefit Management platform. That value creation model also includes a number of technology improvements, including a tool to streamline provider management, a new call center technology platform, and deploying automated provider assignment.
Finally, from a product perspective, Centene will introduce new product offerings that include Ambetter Value, which utilizes an HMO clinic model, Ambetter Select, which leverages tailored networks, and Ambetter Virtual Access which offers $0 in-network telehealth services through their telehealth network.
Centene plans to improve the member experience, invest in technology and execute a value creation plan in order to continue to grow.
Date: December 9, 2021
CVS is unique in that in addition to their health care benefits segment, they also have integrated pharmacy services and retail locations throughout the United States. In fact, 85% of Americans live within 10 miles of a CVS Health location. As a result, their investor presentation has a different, more consumer-focused perspective.
For example, the company’s strategy focuses more on the entire consumer health care experience than other companies. Their first step is to focus on primary care. CVS aims to make the primary care experience organized around the consumer, be frictionless and convenient and ultimately drive higher levels of engagement. They touted their technology — like a phone app — and ability to serve consumers where they are — at home, virtually, or in the community at their retail locations.
As for their health plan, the company strives to be the choice for consumers in Medicare, dual-eligible, and ACA exchanges as well as delivering differentiated benefits to the employer-sponsored market and partnering with states to serve Medicaid members. To do so, they’re focused on affordability and easy access. The company plans to re-enter the ACA exchange business and lead in quality like HEDIS measures and Medicare Advantage Star Ratings to prove their plan quality.
In the employer market, the company will leverage its business assets to deliver a better experience. That includes an integrated plan sponsor approach, providing clients with a single point of contact for medical and pharmacy expertise. Connected products and value-based solutions are also part of the company strategy. To gain Medicaid market share, the company aims to deliver personalized interactions that are mobile-centric, address social determinants of health and deploy high-touch programs to treat chronic and complex health needs.
CVS is uniquely positioned to take a more consumer-centric approach to health care. CVS plans to leverage its assets — including retail and pharmacy locations around the US — to deliver a more connected, more local, and ultimately better consumer experience.
Certifi’s health insurance premium billing and payment solutions help healthcare payers improve member satisfaction while reducing administrative costs.