Health insurers are unleashing a blizzard of ads, letters, live events and other efforts to reach consumers, as the industry ramps up for the reopening of the health law’s marketplaces on Nov. 15.
The companies’ outreach task is more complicated than it was last fall, when the exchanges made their debut. Now, insurers are trying to hold on to an estimated 7.3 million existing enrollees, as well as dig out millions of new customers who declined to sign up before. At the same time, they are pushing for a share of an increasingly crowded market, as more competitors have emerged in a number of states.
“It’s a congested, competitive, confused environment,” said Marc Pierce, president of Stonegate Advisors LLC, which does market research for health insurers. “It will be more challenging this year.”
What’s more, insurers are working under a compressed time frame. Consumers must sign up by Dec. 15 for their new coverage to start on Jan. 1, 2015. The total enrollment window goes only until Feb. 15, unlike last year, when it effectively trailed into April. Also, there are limits on marketing before insurers get full regulatory approval of their plans.
Health Care Service Corp. will be limiting use of the word “deadline” in ads and other messages, so consumers don’t get confused by seeing the term attached to multiple dates. “Last year, there was a kind of deadline fatigue,” said Kurt Kossen, a vice president at the big nonprofit insurer, which is the parent of Blue Cross and Blue Shield plans in Texas, Illinois and other states. This year, “we’re not calling it deadline until Feb. 15.”
Insurers say their first priority is hanging on to existing customers. “It’s much more efficient if we keep the folks that we have,” said Patrick Blair, chief marketing officer at WellPoint Inc., which has 751,000 exchange enrollees. “That’s our No. 1 focus.” WellPoint is phoning many of its enrollees to explain the re-enrollment process, as well as reaching out by mail and email.
Insurers seeking to retain members have to walk a fine line. If their existing customers do nothing, many will automatically be re-enrolled in the plans they previously chose through HealthCare.gov. However, if those people are getting federal subsidies, they risk getting the wrong amount or even seeing the payments vanish in January if they don’t return to the government marketplace site to update their information. That could leave some enrollees surprised and angry when they get their first insurance bills for 2015, if premiums go up and subsidies don’t keep pace.
Insurers are required by regulators to send letters before Nov. 15 that include enrollees’ new premiums and other information. But they say they are going beyond that and pushing enrollees to log into the marketplaces this fall to avoid sticker shock—even though those consumers might eye rival companies’ products.
The goal is to position themselves long term as a trusted source of health-care information, insurers say. “We’re building a relationship,” said Brian Lobley, a senior vice president at Independence Blue Cross, which is based in Philadelphia.
Independence Blue Cross is sending members an “enrollment card” with key dates and blanks for them to write information they’ll need to re-enroll and update their subsidy data at HealthCare.gov, the federal site; it also features the insurer’s name and logo. Independence Blue Cross is also holding live gatherings at places like YMCAs to answer questions from existing enrollees, and texting some of them reminders about enrollment that include a link to a subsidy estimator.
Still, enrollees may not always pay attention. Dick Joyce, 64 years old, of Clemmons, N.C., said he has been getting material about the coming enrollment period from insurers, and “I’m throwing most of it in recycling without even looking at it.”
He does plan to log into the federal HealthCare.gov site to update his subsidy information, based on advice from his insurance agent, but says he’s likely to simply keep his current plan until he becomes eligible for Medicare next spring.
Insurers also are scouring to find people who never signed up last year. The Congressional Budget Office has projected that marketplace enrollment will go up to 13 million in 2015, but insurers say those who stayed on the sidelines during the first year are difficult to recruit. Big insurers are holding thousands of events in the next few months, in locations ranging from sporting events to zoos, churches and bodegas, often targeting hard-to -reach populations.
Blue Cross and Blue Shield of North Carolina, which has said its enrollment this year skewed older than it expected, is redoubling efforts to woo young consumers, with YouTube videos, a Twitter campaign and a series of Google Hangouts sessions, as well as meetings at local community colleges.
The Kentucky Health Cooperative Inc., a nonprofit health plan, is sending a Spanish-speaking staffer to meet with workers at the state’s two big horse-racing facilities, Churchill Downs and Keeneland, often in company with other organizations because workers displayed little interest in meetings billed as focusing solely on health coverage. The nonprofit is also working with county agricultural extension programs to reach farm workers.
This year, many marketplaces are more competitive, with new entrants including industry giant UnitedHealth Group Inc., which will be in about two dozen states, up from four this year. A McKinsey & Co. analysis of data from 43 states found insurer exchange participation up 24%. To cut through, companies are working harder to differentiate themselves in their marketing.
Stonegate Advisors, the market-research firm, found price remains the biggest focus for people shopping for marketplace plans, based on test-marketing done with consumers picking coverage in simulated exchanges. Nearly half of the people in its simulations said cost was one of the top reasons for their choice. Cheaper rates were also the biggest driver for people who chose to switch from an existing plan. About 43% of those with coverage decided to change insurers in the firm’s mock-up exchanges.
Molina Healthcare Inc., which has slashed premiums in nearly every state where it is offering exchange plans, is emphasizing its rates. “Price is key,” said Lisa Rubino, a senior vice president at the insurer. Molina is sending letters to its current exchange members telling them that their plans are getting cheaper. Some of the insurer’s ads include the tag line, “A quality health plan for you and your budget.”
Medical Mutual of Ohio is playing up its broad selection of health-care providers, rather than price. Many exchange plans this year offered relatively narrow networks of providers to keep costs low, which some consumers found frustrating. Medical Mutual’s ads tell consumers to “check the network.”
“We thought that is an important value proposition and we will be able to capture more market share,” said Heather Thiltgen, vice president of individual sales and marketing.