If there’s one thing I’ve learned as a broker, it’s that change can be good. That’s especially true in the health insurance world where innovation is often lacking. In the private exchange market specifically, many organizations (such as the one I work for) have pioneered exciting change in our industry with technology that, at a basic level, streamlines the employee benefits management for employers. This new technology provides a platform for people to easily select their benefits, leveraging recommendation support functionality built from carefully designed algorithms. Part of these systems often includes a benefits administration portal that helps employers manage the backend processes of their employee benefits programs (enrollment, eligibility, etc.) and integrate with their internal HR systems (e.g., payroll). Exchange technology has been in high demand in recent years partly due to the implementation of the Affordable Care Act (ACA) and an industry push toward healthcare consumerism. And we can expect to see much more of this change in 2016 (and beyond).
The financial services industry has seen similar innovation with the emergence of the “RoboAdvisor.” (And no, this has nothing to do with the “Terminator” movies.) In short, a RoboAdvisor is a web-based platform that provides consumers the ability to build and manage their financial portfolio (also using decision-support algorithms) based on their specific financial needs and risk tolerance levels. Instead of hiring a traditional wealth management firm with large fees, consumers can centralize their financial portfolio in one location online, with easy real-time management (no appointment necessary). These organizations also offer consumers automated, value-added features (e.g., tax loss harvesting) to help them better manage their money. Some of the key players in this industry include Wealthfront and Betterment.
So, where does the rubber meet the road in all of this? In an increasingly complex and consumer-focused market, the healthcare and financial services industries are increasingly paralleling each other by showing that one’s health is truly tied to their financial security (and vice versa). The same way that life insurance is a key factor in traditional financial planning, for example, health insurance, disability, and other ancillary lines of coverage are important for consumers to maintain a truly robust level of health and financial protection. Consider the price of an emergency appendectomy surgery. Without health insurance, such a procedure could cost as much as $20,000. There is a great deal of financial risk in not having a well-rounded benefits portfolio that can protect someone from life’s expected and unexpected happenings.
At ConnectedHealth, we truly believe that there is a strong connection between health and financial security and we’ve incorporated a lot of our own research around this topic into our Smart Choices™ Marketplace platform. We recently launched a direct-to-consumer application called My Thrive Score (www.mythrivescore.com), which gives people a personalized “credit score” (think: FICO score) and detailed report about their current health and financial security foundation. Part of the idea behind My Thrive Score is to help users think about where they might have gaps in their coverage and learn how they can more fully protect themselves and their loved ones for the long term. As a licensed broker, technology like this is a true game changer in my mind, because it not only underscores the growing importance of healthcare consumerism, but it also shows that helping people think about the bigger, holistic picture is best for everyone.