Building Better Benefits — the Consumer friendly Way

May 1, 2006

CIGNA HealthCare lets consumers “have it their way” with Internet-based technology.

CIGNA Custom Benefit Builder is coming soon to a large national employer near you—and shortly thereafter, to medium-size employers in select markets, too. The consumer-directed product encompasses a dual focus: 1) to let consumers customize their health benefit selections—and what they pay for them—the way they customize their everyday Internet purchases; 2) to help employers lower benefits costs, reduce administrative work and still offer employees a full array of plan options.

CIGNA HealthCare lets consumers “have it their way” with Internet-based technology.

CIGNA Custom Benefit Builder is coming soon to a large national employer near you—and shortly thereafter, to medium-size employers in select markets, too. The consumer-directed product encompasses a dual focus: 1) to let consumers customize their health benefit selections—and what they pay for them—the way they customize their everyday Internet purchases; 2) to help employers lower benefits costs, reduce administrative work and still offer employees a full array of plan options.

If it sounds a little like Priceline for health benefits, that’s not 100 percent off target.

In the press release announcing the product, CIGNA asserts, “Consumers can personalize their copayment and coinsurance levels, deductibles and out of pocket maximums. As these choices are made, [the system] automatically calculates how much the plan will cost and then allows the consumer to enroll for benefits, all using one integrated online application.” Consumers can:

  • Model their future healthcare utilization based on age, gender and health status;

  • Construct “what if” scenarios to see how their plan choices will affect their out-of-pocket costs, based on projected utilization;

  • Calculate their estimated monthly costs based on plan choices, with added calculator functions available for flexible spending accounts and health savings accounts, to explore how these vehicles can lower employee costs;

  • Decide how much coverage they want based on needs and what they are willing to pay;

  • Review incentives offered by their employer to participate in disease management or wellness programs;

  • Enroll online.

A Choice for Every Need
Make no mistake; this isn’t just a product. It is part of a corporate strategy at CIGNA HealthCare to be the health benefits leader in consumerism. Tom Richards, senior vice president of product for CIGNA HealthCare, says that in almost every other purchase arena—such as banking, automobile purchases and travel—consumers already have experienced vast electronic choice and convenience, and they increasingly expect it across the board. “But historically, that hasn’t been true in healthcare,” he says.

In the past, he explains, benefit managers faced an annual challenge. “Some employees want to ‘buy up,’ and others want to ‘buy down.’ Some want more take-home pay while others want richer benefits. Either way, the benefit manager had to decide which plan options to offer. This automatically made him the bad guy, because some employees’ preferences wouldn’t be addressed. Forced choice always creates dissatisfaction.”

For some CIGNA plan members, forced choice soon will be history. With CIGNA Custom Benefit Builder, employers that used to offer an array of different prepackaged plans can now offer a single integrated plan containing multiple choices and options for singles, couples and families, as well as for high, moderate and low utilizers. The system is packed with decision support tools to help employees compare all the options available and estimated costs for each.

According to Will Giaconia, product manager, CIGNA Custom Benefit Builder, an online process of exploration, comparison and selection, can require as little as 10 minutes from the consumer and generally takes about 15 minutes to complete. But, to whittle that process down to 15 minutes required influencing the far reaches of the CIGNA infrastructure to authentically embrace a consumer orientation, a process Giaconia says took between one and two years and required mindset sophistication as much as IT sophistication.

The outcome is a product that starts consumers building a foundational health status profile. “From there,” says Giaconia, “the system lets the consumer experiment—with choices, costs and varying levels of benefits, copayments and deductibles—so he can trade off in terms of what is most valuable to him and his family. Finally, the employee can enroll and receive online confirmation in one transaction, while the system generates a data feed back to the employer.”

Backing Up the Business Decision
Management at CIGNA HealthCare began discussing the concept of a flexible, customizable and consumer-friendly product two years ago. That concept gained steam last fall, says Richards, when CIGNA acquired Choicelinx Corp., a privately held supplier of Internet-based technology in Manchester, N.H. Since 2000, Choicelinx has serviced health plans and third party administrators that want to develop personalized healthcare and decision support tools for plan members.

Chris Henchey, cofounder and chief operating officer of the company, describes Choicelinx as “a group of former healthcare people who use technology to overcome challenges, versus a technology company trying to figure out what challenges a health plan faces.” Henchey says that even many healthcare professionals would be surprised at how much data is available. “There’s an extraordinary amount. When we formed Choicelinx, we wanted to design a product that would turn a lot of the available data into information for consumers, and then enable turning that information into relevant choices. The final step is to move the relevant choices into a transaction on behalf of a health plan client.”

Choicelinx is .Net-based and is a complete Microsoft shop. The company also has partnered with Subimo. “We like their data sources and technology a lot,” says Henchey. “We have been able to take their information and incorporate it into an actual enrollment process. Instead of going to three or four Web locations, the consumer can logon to a single Web site, create a personal profile, project his annual utilization, compare it against the benefits available and then generate information about the total cost of those benefits, so he can plan his individual healthcare budget for the year—all in one Internet experience.”

CIGNA conducted extensive market research and consumer usability testing for the capability. They also fielded a randomized survey conducted by Ipsos Public Affairs, and learned that 81 percent of consumers wanted the opportunity to customize their health benefit selections according to individual needs and budgets. Equally impressive, although not a surprise to Richards, Giaconia or Henchey—79 percent of respondents said they felt confident in their abilities to decide how much coverage they needed and what they were willing to pay for it.

Use of research helped to power the sea change in the CIGNA infrastructure toward consumer-directed strategies, and simultaneously has supported the Choicelinx connection in constructing a satisfying online experience for consumers.

Consumer Ed Opps
Online provider directories and enrollment processes, once nouveau, are the tip of the iceberg now. Consumers have grown comfortable with online self-service backed by robust decision support. Every day, they engage in online purchases and transactions using such tools.

Knowing that, CIGNA has used Customized Benefit Builder as a mammoth opportunity to educate consumers even beyond the sophisticated levels achieved in 2003 and 2004 via pervasive portals. “Health benefits and the use of healthcare services are like most commodities: There is a total cost of ownership, and various stakeholders play a role,” says Richards. Through CIGNA Custom Benefit Builder, CIGNA wants to educate consumers about the total cost of healthcare—about how expenses are generated, what kinds of expenses are paid by employers, and how employees’ choices and the responsibility they assume can positively or negatively influence utilization and expenses for all stakeholders. That means showing consumers not just what they pay, but what healthcare really costs—real charges, real premiums and real payments.

In purchasing a car, any consumer might consider a host of options and ask himself, “Do I need that? Is it worth an additional $900?” But how many consumers will ask a physician why he ordered four lab tests or what an MRI will show that an X-ray didn’t. Not many—not yet, anyway. But that, too, soon will be history.

Consumers who want more choices and more sponsored vehicles for savings will, as part of the package, inherit more responsibility to manage their share of the total cost of ownership and, most probably, a greater portion of the cost. Asking questions of providers is just part of the equation.

Are they ready? Citing the Ipsos survey, Henchey says, “The consumer is absolutely ready to make these kinds of choices today, right now.” Because of that, so is CIGNA.

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