Disruption in the healthcare industry intensifies

First came the industry-wide changes from the Affordable Care Act and a host of proposed mergers, and now comes on-demand healthcare apps. Companies would be wise to keep their eye on the consumer—just like Humana is doing.

The passage of the Affordable Care Act in 2010 has resulted in new challenges, but new opportunities as well for healthcare companies. They are facing requirements to cover an expanding set of services and new scrutiny over rate increases, but also increased enrollment and business opportunities to expand into areas such as state- and federally-funded Medicaid programs. This has led to the proposed mergers by five of the industry’s largest players—the bid by Anthem for Cigna, the proposed takeover of Aetna by United Health and in turn, the proposed acquisition of Humana by Aetna. It’s difficult to keep track without a scorecard!

Now, while the large players are focused on merging with each other, along comes a new disrupter—pegged in the media as “Uber for healthcare”.  Consumers can use an app to directly request an in-home visit by a medical doctor—bypassing typical group practices, insurance companies and the entire healthcare industry. Like Uber and AirBnB, a whole set of new startups that you probably haven’t heard of (like Heal, Pager and MedZed)) are using technology to match excess medical capacity to consumer demand. Now more than ever, established healthcare companies must become laser-focused on understanding the needs of their customers and providing ways to leverage technology to deliver healthcare more effectively.

Coincidentally, one of the companies involved in the merger discussions, Humana, was also recently interviewed by Oxford Economics as past of a new study called The Battle for Competitive Advantage in the App Economy. The interview (which took place prior to the announcement of Aetna’s merger intent) outlines the strong focus that Humana has placed on building relationships with its customers and using mobile technology to encourage fitness and well-being.

“We as a company are investing heavily into mobile because we think it is a great way to engage the consumer,” says Ajoy Kodali, vice president for information technology at Humana. “We can meet the consumer where they want us to meet them. From an activity, health, and wellness perspective, mobile is a game changer.”

Going beyond just providing mobile app access to health resources, Humana is using technology to encourage its customers to exercise and get fit.

“The idea,” says Mr. Kodali, “is to make it a fun exercise and fun to exercise.”

One add-on to the program is an app that uses geo-location to guide users to a nearby gym and connects to fitness devices that nudge them to take more walks by rewarding them with points for steps. The app tells its Humana members things like: “Hey, you’re 1,000 steps short of getting 10 more points. How about you go get an extra walk in right now?”

While time will tell how Humana fairs in its potential merger with Aetna, it is clear that the company has laid a great foundation of customer engagement that will hopefully transcend both the immediate merger and the longer-term threat from the start-up app companies.

To read the full story of how Humana is leveraging technology to connect with their customers, visit Rewrite and click here.

Jackie is a 30-year IT industry veteran, holding senior management positions in marketing, business development…


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