Welcome to part one of our healthcare payer market blog series!
The healthcare payer market has never been more competitive. To win new group sales in today’s market, marketers must be able to deliver more value than their competition, from both a service and customer experience perspective.
Let’s dive into three key affecting trends payer group sales today.
Trend 1: Highly Saturated Employee Health Plan Market
The healthcare payer market is highly saturated, with most employers have longstanding payer relationships. In 2018, 88% of employees in large businesses (500+ employees) and 69% of private industry workers were offered medical care benefits, according the Bureau of Labor Statistics. This means that if your company is targeting enterprise businesses, your target accounts are probably already working with a competitor.
If you’re targeting new markets, you’re likely going to face an incumbent that has long-term relationships with the businesses in that area. In 91% of metropolitan areas, at least one insurer had an overall market share of 30% or higher, according to the American Medical Association.
Trend 2: New Entrants
There has been significant growth of new entrants into the payer space in recent years. Entrants are developing new business models that they believe can better serve potential members and steal market share.
CVS’s acquisition of Aetna allows Aetna to expand their reach and new drive revenue opportunities. New plans like Oscar are growing rapidly — Oscar grew their business to 8 states and 14 locations from 2012 – 2018.
Large corporations are branching into the payer market as well. Take, for example, the Amazon, Berkshire Hathaway, JPM Chase’s partnership Haven. If Haven proves to be successful, other enterprise corporations are likely to follow.
Trend 3: Increasing Customer Expectations
B2C companies like Amazon, Lyft, Warby Parker, and AirBnB have accelerated consumer expectations — not just in their own industries but across all industries. Consumers now expect this new elevated customer experience in every aspect of their day-to-day life, including their relationship with their health insurance company. And this goes beyond member engagement.
According to Salesforce’s State of the Connected Customer report, 69% of business buyers expect Amazon-like buying experiences. This means that the employers you work with expect to be able to engage with you where they want, when they want, how they want, on any channel, and on any device.
Payers that are winning market share are differentiating their customer experience both at the group sales and member level. In order to deliver a truly differentiated customer experience, marketing, sales, and service must be aligned. According to MarketingProfs, organizations with tightly aligned sales and marketing functions experience 36% higher customer retention rates and 38% higher sales win rates.
In part two of this blog post, we are going to dive into three strategies that payers are leveraging to build a differentiated employer experience and drive tighter alignment between marketing and sales. Stay tuned!