With premiums skyrocketing, employers and consumers are looking for an alternative to conventional insurance. Forrester Research, Inc. (Nasdaq: FORR) predicts that emerging eHealth plans will unleash a trend of consumerism in the medical market this year, increasing employee accountability and taking share and profits from HMOs. This prototype will be an important step toward the future of healthcare online.
What’s different about the eHealth plan model? An eHealth plan gives the consumer the tools to choose personalized benefits, the course of care that should be sought, and which provider to consult. “It will give consumers the means to take greater control of personal health decisions,” said Forrester Senior Analyst Bradford J. Holmes. “It can provide different options with economic consequences when normally there aren’t a lot of choices.”
With multiple eHealth plan introductions in 2001 and 24% of employers likely to offer employees an eHealth plan by 2002, consumers will increasingly have an eHealth plan choice. Products and markets will evolve in three phases over the next five years: the era of choice, the era of motive, and the era of markets. In the era of choice (2001-2002), eHealth plans will emphasize personalized benefits options at enrollment because offering more choice is easy and incremental. Consumers will be able to adjust their copayments or increase their deductible to decrease their monthly contribution. In the era of motive (2003-2004), eHealth plans will focus on incorporating and employing a medical spending account (MSA) and providing decision support for consumers’ use of healthcare services. In the era of markets (2005 and after), providers will compete for patients, and eHealth plans will have the price and quality transparency they need to populate their eMarketplaces of providers.
“eHealth plans are rolling out in force, and with employers’ and consumers’ interests piqued, insurers must respond or fall behind,” Holmes said. “They need to react defensively to the threat that startup eHealth plans will attract younger members, and adjust for expected adverse selection by increasing pricing to account for the older members who remain in their plan. Then, they must proactively chart their eHealth plan strategies, based on a review of their skills and assets.”